MIT tax changes deferred
A range of changes to the tax system governing managed investment trusts (MITs) has been pushed back a year to 1 July, 2012, the Government has announced.
The extra 12 months will allow MITs and other sectors of the financial services industry to make any necessary trust deed amendments and systems changes, Financial Services Minister Bill Shorten (pictured) announced.
This came just a day after Shorten announced the current exemption of financial planners from the tax agent services regime had been extended to 30 June, 2012, to allow time for the regulatory model to be developed.
The tax laws will also be amended to prevent income tax consequences that may arise from a resettlement where a MIT changes its trust deed to meet requirements under the new system, Shorten stated.
“These amendments will ensure MITs needing to amend their trust deeds, to be eligible for the attribution method of determining tax liabilities and deemed fixed trust treatment, are not deterred by income tax consequences from making the necessary amendments,” Shorten said in a statement.
The de minimis rule that allows MITs to carry forward ‘under and over’ distributions into the next income year without adverse taxation consequences will be changed from a dollar value per unit test to a percentage of net assets test. This means MITs of similar worth but with a different number of units will be treated more equitably, according to Shorten.
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