Who must make trustee resolutions for trust distributions by 30 June?

Discretionary trust trustees must validly resolve to distribute trust income before the end of the FY.

For discretionary trusts, trustees must validly resolve to distribute trust income (and capital gains for streaming) by 30 June each year (subject to trust deed timing). Failure means default beneficiaries (often the trustee taxed at 47%) bear tax. ATO TR 2012/D1 + PCG 2018/4 guidance applies.

Applies when the business has a trust.

How the regulator frames it: Trustees of discretionary trusts.

What triggers it: End of each financial year.

Jurisdiction: Commonwealth law, so the test is the same in every state and territory.

Outcome across the 35 industries Rules Mate maps (35 of 35: depends on size or structure).

The answer is the same in every industry: depends on size or structure. Industry does not change who must comply.

Size does not change the answer across all industries: at every size band the answer is "depends on size or structure".

Each line is one run of the Rules Mate applicability engine for a single business profile, with the reason the engine gives:

• Trust in real estate agents with 6–19 employees, turnover $1M–$3M: applies. Trust structure.
• Pty Ltd company in real estate agents with 6–19 employees, turnover $1M–$3M: does not apply. Requires a trust.

When due

By 30 June (or earlier deed-specified date).

Frequency

Annual

Evidence to keep

Written trustee resolution, financials, accountant sign-off.

Status

Current

Priority

Critical

Maximum penalty: Trustee assessed at 47%; potential reassessment and interest if late resolutions challenged by ATO.

Rules Mate has not yet classified the audit or assurance level for this obligation. Any audit, review or certification requirement is set by the regulator source listed below.

• Australian Business Number (ABN) application: Entities carrying on an enterprise in Australia need an ABN — without one, payers must withhold 47% PAYG from your payments. How to apply and who's eligible.
• Lodge Business Activity Statements at assigned frequency: GST-registered entities must lodge a BAS monthly, quarterly or annually as the ATO assigns.
• Pay company PAYG/GST/SG or face Director Penalty Notice (DPN): Directors personally liable for unpaid company PAYG, GST + SG via DPN regime.
• TASA Code Determinations from 1 August 2024: Tax practitioner code reformed via Code Determinations — false + misleading statements + supervision + breach reporting.
• Withhold PAYG from employee and contractor payments: Employers must withhold tax from wages, certain contractor payments + report via STP / BAS.

Rules Mate tracks 37 published obligations tagged "tax", 6 of them rated critical. For a professional services Pty Ltd company with 6–19 employees operating in every state, 7 of those apply outright. This obligation is rated critical priority, and is a annual obligation.

Regulated by Australian Taxation Office.

ATO: Federal tax administrator covering income tax, GST, PAYG, FBT, superannuation guarantee, STP, and self-managed super funds. Also administers the Director ID regime via ABRS.

• Australian Taxation Office

ITAA 1936: Older income tax Act, gradually being replaced by ITAA 1997 but still contains many key provisions: trust taxation (Pt III Div 6), general anti-avoidance (Pt IVA), debt deductions for interest (Pt IVA), Controlled Foreign Company rules (Pt X).

• Income Tax Assessment Act 1936

Free tools that help with this obligation:

• GST registration scope
• FBT calculator
• Compliance calendar builder