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ARTICLE · 02 OCTOBER 2026

Minimum Tax On Discretionary Trusts: What The Exposure Draft Means For Trustees

Holding Redlich
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The Australian Government has released exposure draft legislation for a proposed 30% minimum tax on discretionary trusts, effective from 1 July 2028. Trustees now face three strategic pathways: remain within the minimum tax regime, restructure using transitional rollover relief, or elect into the new excluded election trust (EET) regime with restricted distribution flexibility.

AustraliaTax
Eli Bursky
Eli Bursky
Dhanushka Jayawardena
Dhanushka Jayawardena
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The Government has released exposure draft legislation for its proposed 30% minimum tax on discretionary trusts, giving trustees and advisers a much clearer picture of how the regime is intended to operate from 1 July 2028.

In addition to providing greater detail on the proposed minimum tax and restructuring relief, the draft legislation introduces a new excluded election trust (EET) regime, giving existing discretionary trusts a potential alternative to restructuring.

Affected trustees will therefore have three broad pathways: remain within the minimum tax regime, restructure using the proposed transitional rollover, or make an EET election and accept restrictions on future distributions.

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This publication does not deal with every important topic or change in law and is not intended to be relied upon as a substitute for legal or other advice that may be relevant to the reader's specific circumstances. If you have found this publication of interest and would like to know more or wish to obtain legal advice relevant to your circumstances please contact one of the named individuals listed.

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