Avoid tax penalties by making your Trust Distribution Resolutions

Save Tax in 2020 - Avoid tax penalties by making your Trust Distribution Resolutions

By Gavin Weller

April 21, 2020

Do you have a Discretionary Trust (also known as a Family Trust)? 

If yes, this is important, so please keep reading!

In the lead-up to 30 June 2020, we want you to be aware that you need to complete your trust distribution resolutions before 30 June. 


To avoid paying extra tax of up to 47% of Trust profits.

How can this happen?

If a Trustee of a Trust fails to make a resolution to distribute the income of the Trust before the end of the financial year, the Trustee may be assessed by the Australian Taxation Office (ATO) on the Trust income at the highest marginal tax rate of 47%, rather than the intended beneficiaries being taxed at generally much lower tax rates.

What we are doing to help you

Even though preparing a trust distribution resolution before the end of the financial year can be quite complex, we need to help you to comply with the trust taxation laws.

The steps we need to undertake on your behalf include:

  • Review of your prior year Trust Distribution Resolution
  • Confirmation with you of the estimated Trust income of your Trust for the year ended 30 June 2020
  • Review of your Trust Deed to ensure that the income definition and distribution clauses in your Trust Deed allow the proposed Trust Distribution Resolution for 30 June 2020
  • Advice on the most tax effective distribution of this estimated Trust income
  • Preparation of Trust Distribution Resolution and ensuring it is signed by the Trustees PRIOR to 30 June 2020

Next Steps

Contact us today! The sooner we get started with preparing your 2020 Trust Distribution Resolutions, the sooner we can help you save tax - well before 30 June for sufficient time to implement tax-saving strategies.

Imagine what you could do with your tax saved! 

  • Reduce your home loan
  • Top up your Super
  • Have a holiday
  • Deposit for an Investment Property
  • Pay for your children’s education
  • Upgrade your Car

 For more information on different Tax Planning strategies and free Tax Minimisation resources, head over here. 

Posted in


About Gavin

Director & Business Advisor

Gav is a Director of Trekk and operates from our Brisbane office - helping his client's in the advisory space in planning, strategy, structure, and taxation. He loves being able to work closely with both his clients and his team to help them achieve their goals.   

Related articles