The Ball Family Trust was set up in 2014 as a discretionary family trust. Roger Ball is
Question:
The Ball Family Trust was set up in 2014 as a discretionary family trust. Roger Ball is the head of the Ball family and arranged for a Trust Deed setting up the Ball Family Trust appointing him as sole trustee of this Trust. The beneficiaries of the Ball Family Trust are Roger and Dina Ball and their children, grandchildren and other descendants. For the 2023 year, the Ball Family Trust had a net income of $120 000. Roger produced written Trustee Minutes in which he, as trustee, exercised his discretion to distribute $20 000 of that net income to himself; $20 000 to Dina (his wife); $20 000 to Nick (his adult resident son, aged 23 who was recently declared bankrupt); $20 000 to James (his adult non-resident son, who now lives in Singapore) and $10 000 to AXZ Pty Ltd (a private company that has only two shareholders, Roger and Dina Ball). Roger miscalculated and forgot to distribute the remaining $10 000 to anyone.
Please advise Roger Ball as to the tax consequences of these intended distributions, indicating which party has the responsibility to pay the relevant tax and which tax rates would apply to each distribution
Smith and Roberson Business Law
ISBN: 978-0538473637
15th Edition
Authors: Richard A. Mann, Barry S. Roberts