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Managed Investment Trusts

If the trust is a managed investment trust has the trustee made an election into capital account treatment? Y/N

Select Y for yes from the list if the trust is a managed trust and the trustee is making an election into capital account treatment for the 2017-18 year?

With effect from the 2008-09 income year, trustees of eligible Australian managed investment trusts (MITs) can make an irrevocable election to apply the CGT provisions for the taxation of gains and losses on disposal of eligible assets.

Meaning of 'eligible MIT'

An eligible MIT is a managed fund that meets:

  • the definition of a 'managed investment trust' in Subdivision 12-H in Schedule 1 to the TAA 1953; or

  • one of the extended definitions that allow the trust to be treated in the same way as a MIT for the purposes of the capital treatment election.

Who is eligible to make an election?

The trustee of an eligible MIT may make an election. The election must be made in the approved form.

How to make an election

For MITs that came into existence during the income year, a valid election is made by answering 'Yes' to the question asked on page 2 of the trust tax return. The election must be made on or before the day the trust is required to lodged its tax return for income year, or if the Commissioner allows a later day, that later day.

If you are the trustee of a MIT that came into existence in an earlier income year, you must still answer the question regardless of whether you have previously made an election for capital treatment.

From when is the election in force?

For trusts that became a MIT prior to the 2009-10 income year, will have effect from the 2008-09 and later income years.

For trusts that became a MIT in the 2009-10 income year or a later year of income, the election will have effect for the income year in which the trust became a MIT and later income years.

A new tax system for managed investment trusts

The Tax Laws Amendment (New Tax System for Managed Investment Trusts) Act 2016, which introduces a new tax system for managed investment trusts (MITs), was introduced into Parliament on 3 December 2015.

A trustee may elect to apply the new rules for income years starting on or after 1 July 2016. However, in certain circumstances, a trustee may be able to elect to apply the new rules from 1 July 2015.

CCH References

6-400 Managed investment trusts

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