4.12.1.10 Determining a designated private trust or private company from 01/01/2002

Date of effect

This topic has effect to private trusts and private companies from 1 January 2002.

This topic

This topic contains information on the following:

  • summary
  • determining a designated private trust, and
  • determining a designated private company.

Summary

For the assets (1.1.A.290) and income of a private trust or private company to be attributed to an individual the trust or company must be:

  • a designated trust or company, AND
  • a controlled trust or company in relation to the individual, AND
  • the individual must be an attributable stakeholder of the trust or company.

Act reference: SSAct section 8(1)-'income', section 1207N Designated private companies, section 1207P Designated private trusts, section 1207Q Controlled private companies, section 1207V Controlled private trusts, section 1207X Attributable stakeholder, asset attribution percentage and income attribution percentage

Policy reference: SS Guide 4.12.1 Attribution Guidelines for Private Trusts & Private Companies from 01/01/2002, 4.12.2 Attributable Stakeholders & Attribution Percentages

Determining a designated private trust

A trust is a designated private trust UNLESS:

  • ALL of the following conditions are satisfied
    • the trust is a fixed trust
    • the units in the trust are held by 50 or more persons
    • the trust was not created or operated under a scheme that was entered into to gain a social security or Veterans' Affairs advantage, OR
  • the trust is a complying superannuation fund, OR
  • the trust is an excluded trust.

Once the assessor has determined that the trust is a designated private trust then the issue of who controls the assets and income of the trust and the percentage of control to be attributed to the individual/s can be decided.

Act reference: SSAct section 1207A Definitions (Means test treatment of private companies and private trusts), section 1207P(3) Complying superannuation funds, section 1207P(4) Excluded trusts

Social Security (Means Test Treatment of Private Trusts - Excluded Trusts) Declaration 2015

Policy reference: SS Guide 4.12.3.20 Fixed (Non-discretionary) Trusts

Determining a designated private company before 1 July 2019

A company is a designated private company if:

  • the company satisfies at least 2 of the following conditions in relation to the financial year ending immediately before the assessment period
    • the consolidated gross operating revenue for the financial year for the company and its subsidiaries is less than $25 million
    • the value of the consolidated gross assets at the end of the financial year of the company and its subsidiaries is less than $12.5 million
    • the company and its subsidiaries have fewer than 50 employees at the end of the financial year, OR
  • the company is a new company and came into existence after the end of the last financial year, OR
  • the company is a declared private company, AND
  • the company is not an excluded company.

Once the assessor has determined that the company is a designated private company then the issue of who controls the assets and income of the company and the percentage of control to be attributed to the individual/s can be decided.

Determining a designated private company after 1 July 2019

A company is a designated private company if:

  • the company satisfies at least 2 of the following conditions in relation to the financial year ending immediately before the assessment period
    • the consolidated gross operating revenue for the financial year for the company and its subsidiaries is less than $50 million
    • the value of the consolidated gross assets at the end of the financial year of the company and its subsidiaries is less than $25 million
    • the company and its subsidiaries have fewer than 100 employees at the end of the financial year, OR
  • the company is a new company and came into existence after the end of the last financial year, OR
  • the company is a declared private company, AND
  • the company is not an excluded company.

Once the assessor has determined that the company is a designated private company then the issue of who controls the assets and income of the company and the percentage of control to be attributed to the individual/s can be decided.

Last reviewed: 1 July 2019