MEDIA RELEASE (AU)

Chartered Accountants Australia and New Zealand (CA ANZ) has reiterated concerns to a Senate committee that key policy and practical issues remain unresolved in the Government's proposed trust tax reforms, leaving taxpayers, advisers and software providers with limited time to prepare for implementation.

Appearing before the Senate Economics Legislation Committee as part of its inquiry into the Treasury Laws Amendment (Tax Reform No. 3) Bill 2026 and Income Tax Rates Amendment (Minimum Tax on Discretionary Trusts) Bill 2026, CA ANZ said it supports the Government's objective of addressing inappropriate income splitting through discretionary trusts. However, important design and implementation questions remain unresolved, and require greater certainty before the reforms commence.

These include uncertainty around not-for-profit exclusions from the 30 per cent tax on trusts and eligibility for excluded election trust status. Further legislation is also required to clarify how the minimum tax will interact with capital gains tax, residency rules and international tax arrangements.

CA ANZ Group Executive Advocacy, International and Government Affairs, Damian Ogden, said taxpayers still need greater certainty before the reforms commence.

"These reforms have significant implications for taxpayers who use trusts for legitimate commercial purposes, particularly family businesses that operate through discretionary trust and corporate beneficiary structures," he said.

"Without certainty on how the rules will operate in practice, some businesses may feel compelled to restructure long-standing arrangements to avoid double taxation outcomes."

"We appreciate the opportunity to appear before the Committee and welcome the ongoing consultation process. We look forward to continuing to work constructively with the Government to address the remaining issues and support successful implementation of the reforms."

CA ANZ said the remaining uncertainty around key aspects of both the trust and CGT reforms reinforces the need for realistic implementation timeframes, allowing taxpayers time to review the final legislation and ATO guidance, obtain advice, consider their options, update systems and processes where necessary, and make informed decisions.

"The closer implementation gets without that clarity, the greater the risk of confusion, inadvertent errors and unnecessary compliance costs," CA ANZ Tax, Superannuation and Financial Services Leader, Susan Franks, said.

"Good tax policy is not just about designing legislation. It's also about making sure taxpayers have sufficient time, guidance and support to understand their obligations and comply with the law."