There are not just the setup costs to consider, trustees in a family trust are also liable to pay tax on any income they get from the trust.

Adult and company beneficiaries pay tax on their share of the trust's net income at the tax rates that apply to them.

And tax also needs to be paid on undistributed income.

If the trust income is not fully distributed to beneficiaries, whether it's by choice or not, the trustees have to pay tax on the income retained in the trust at the top marginal rate of 45%.

Then there are beneficiaries who aren’t Australian residents - when trust income is distributed to someone who isn’t a resident, the trusts have to pay tax on their behalf.

Trustees also have to pay tax on behalf of beneficiaries who are under the age of 18, which is usually at the top marginal tax rate of 45% (where the minor receives $1,308 or more).

Why so much?

Well, the high tax rate was put in place to deter families from making trust distributions to minors.

RealRenta has all the tools that a property manager has but for less than ¼ the cost of a property manager.

Join now and the cost is less than a cup of coffee a week to manage your rental property.

RealRenta also has a free vision, so why not check it out.

Jason Gwerder
Friday, 16 June 2023

Join our mailing list Receive Free Property Tips and news

Now Partnered With


Contact Us

1300 11 RENT (7368)