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James Millar
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bennos, post: 133723 wrote:
OK. I’m getting the idea that this is a something I should not worry about doing.

By the way, is this a matter an accountant or solicitor should have knowledge about and be able to advice their client?

Most accountants should know about these developments but whether they actually do is another question. We still see (and hear of) accounting firms promoting the use of corporate beneficiaries but in my view the fundamental benefit is gone. In short, if you need personal access to trust profits then it will trigger a personal tax bill pretty much immediately. If you can go without the profits and genuinely channel the cash distribution to a corporate beneficiary (so there are no loans between the entities) then they can be used.

If you create paper distributions to a corporate beneficiary (basically unpaid present entitlements or UPE’s) after 16 December 2009 then beware – get a second opinion. I believe UPE’s prior to this date can be quarantined.

In answer your specific question – most solicitors would have little exposure to and understanding of DIV 7A and post Bamford issues. It’s a complex tax and accounting issue so unless they specialise in tax law AND have a solid understanding of group balance sheet interaction then they are unlikely to be able to assist effectively. They will however will able to assist in trust deed design from a trust law perspective (but I still think trust deeds should be reviewed by an accountant before they are finalised – trust law and tax law are very different).

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