FNSACC601 Tax Assessment Tasks - Prepare And Administer Tax Documentation For Legal Entities

Task 7 - Trusts

Harry Wilson died on 15 December 2017. His will provides that the net income of his estate is to be distributed to the following beneficiaries.

In addition to the distributions in the table above, the trustee also paid the following amounts during the year:

• $5,000 to Tony for a car to drive to work.
• $10,000 to a registered charity as a donation.
• For the 2017/18 tax year, assessable income received by the trust amounted to $120,000.

Required

a) Prepare a schedule nominating (5 marks).

• Beneficiary
• Whether or not the beneficiary is presently entitled
• Whether or not the beneficiary is under a legal disability
• Which sections of the act apply to make the income assessable
• Who is assessed on each amount
• The amount distributed or retained

b) Calculate the s95 net trust income and the tax payable by the trustee (5 marks).
c) Calculate tax payable by Tony and Steve (5 marks).