Trust Question

[Whatsup]

To all the accountants out there, If a share trading account is held in a trust and a family trust is a beneficiary of that trust. From an accounting perpective how are dividends dealt with. Dividends are tax free, however when the recipient is another trust does this alter the status, ie does the family trust reflect the dividend as income or dividends recieved? The other option is can the shareholding trust attribute the proceeds to the family trust?

[Whatsup]

The bean counters must all be busy as nobody has replied?

[bangbul]

Maybe non wants to tell you free of charge?

[#4]

I would say go speak to your accountant, its not an answer I would give (I am not an accountant) over an open forum. There are to many variables to generalise so rather seek professional advise and pay the small fee if you have to to get the right answer to your situation. Some things are just not free in life.

[Whatsup]

WTF If I wanted a lecture I would have gone to university for the day. To my mind the financial structuring of ones affairs would have universal appeal, certainly amongst all the forumites.

[SimonPB]

lol, well while there .. attend the tax lecture ??

[#7]

My trust knowledge is a bit rusty... However.... I assume you are asking from a tax perspective. In a trust income retains its nature. So If dividends are received and paid out to a beneficiary in the same year the nature of the distribution is that of a dividend. No tax in the beneficiaries hands. Ditto if it was interest, then it would be taxed as interest in the benificiaries hands. Also remember, if the income remains in the trust for over a year, it is taxed in the trust (i.e. no tax on the dividends) and can then be distributed tax free. If you look at a trust's tax retun you will note there are several columns for income as you need to keep the various streams seperate so the tax can be worked out.

[#8]

Tax laws changed , you can distribute to another trust but the trust will be taxed on that income

[Whatsup]

Thanks for the replies guys, this is what I asked for as opposed to some peasant trying to be clever. Mox are you refering to normal income or do share dividends fall into this as well?

[bangbul]

It worked! I was trying to play on someones conscifnce.lol

[#11]

Dividends would be tax free. If you capital gain you can distribute to the beneficiary trust, but the trust in which the capital gain is made would be taxed.