While trustees of listed trusts, certain licensed widely
held trusts and registered MIS have greater certainty on what is
required for a trust to be treated as having fixed entitlements,
there will likely be an administrative cost for trustees of all
other trusts wishing to rely on the safe harbour (if they can rely
on it at all). It should be noted that trusts which qualify for
AMIT status are deemed to be "fixed trusts" and so
uncertainties relating to fixed trust status are resolved by AMIT
qualification and the trustee making the appropriate
election.
Whether a trust is capable of being a "fixed trust"
has been a contentious issue for many years, and clarification of
the administrative approach of the Australian Taxation Office
(ATO) is much needed. Fixed trust status is
important to ensure that, amongst other things, franking credits
may be distributed to unitholders and to ensure that certain
rollover relief is available. It is also important for being able
to
