Commonwealth Consolidated Acts

SOCIAL SECURITY ACT 1991 - SECT 1207V

             (1)  For the purposes of this Part, a trust is a controlled private trust in relation to an individual if the trust is a designated private trust and:

                     (a)  the individual passes the control test set out in subsection (2); or

                     (b)  the individual passes the source test set out in subsection (3).

Control test

             (2)  For the purposes of this section, the individual passes the control test in relation to a trust if:

                     (a)  the individual, or an associate of the individual (other than an associate covered by paragraph 1207C(1)(j)), is the trustee, or any of the trustees, of the trust; or

                     (b)  a group in relation to the individual was able to remove or appoint the trustee, or any of the trustees, of the trust; or

                     (c)  a group in relation to the individual was able to vary the trust deed or to veto the decisions of the trustee; or

                     (d)  the aggregate of:

                              (i)  the beneficial interests in the corpus or income of the trust held by the individual (whether directly or indirectly); and

                             (ii)  the beneficial interests in the corpus or income of the trust held by associates of the individual (whether directly or indirectly);

                            is 50% or more; or

                     (e)  a group in relation to the individual had the power (by means of the exercise by the group of any power of appointment or revocation or otherwise) to obtain, with or without the consent of any other entity, the beneficial enjoyment of the corpus or income of the trust; or

                      (f)  a group in relation to the individual was able in any manner whatsoever, whether directly or indirectly, to control the application of the corpus or income of the trust; or

                     (g)  a group in relation to the individual was capable under a scheme of gaining the enjoyment or the control referred to in paragraph (e) or (f); or

                     (h)  a trustee of the trust was accustomed or under an obligation (whether formally or informally) or might reasonably be expected to act in accordance with the directions, instructions or wishes of a group in relation to the individual.

Source test

             (3)  For the purposes of this section, an individual passes the source test in relation to a trust if:

                     (a)  the individual has transferred property or services to the trust after 7.30 pm, by standard time in the Australian Capital Territory, on 9 May 2000; and

                     (b)  the underlying transfer was made for no consideration or for a consideration less than the arm's length amount in relation to the underlying transfer.

Group

             (4)  A reference in this section to a group in relation to an individual is a reference to:

                     (a)  the individual acting alone; or

                     (b)  an associate of the individual acting alone; or

                     (c)  the individual and one or more associates of the individual acting together; or

                     (d)  2 or more associates of the individual acting together.

Income

             (5)  In this section:

"income" means income within the ordinary meaning of that expression.