ARTICLE · 06 OCTOBER 2008

Managed Funds: Changes To The Eligible Investment Business Rules

Moore Australia

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Tax Laws Amendment (2008 Measures No 5) Bill 2008 (the “Bill”) was introduced into Parliament on 25 September 2008, it included changes that were intended to make it easier for managed funds to comply with the law by reducing the scope for them to inadvertently breach Division 6C (i.e. the public trading trust rules that can tax a trust as a company).

AustraliaTax

Stephen O'Flynn

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Tax Laws Amendment (2008 Measures No 5) Bill 2008 was introduced into Parliament on 25 September 2008, it included changes that were intended to make it easier for managed funds to comply with the law by reducing the scope for them to inadvertently breach Division 6C (i.e. the public trading trust rules that can tax a trust as a company). Whilst we are pleased that the meaning of "investing in land" has been broadened, it is unfortunate that the Bill falls short of providing greater certainty for most property trusts, as the proposed safe harbours included in the amendments do not provide any greater certainty than the current law and property trusts will largely be required to rely upon the existing rules when determining what is incidental income.

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