LAND TAX MANAGEMENT ACT 1956 - SCHEDULE 1AA

LAND TAX MANAGEMENT ACT 1956 - SCHEDULE 1AA

SCHEDULE 1AA – Family unit trusts--special provisions

(Section 3A (4) (f))

2 Family unit trust--special concession

(1) A unit trust is a
"family unit trust" in relation to the land tax year commencing on 1 January 2006 if, at midnight on 31 December 2005--

(a) the trust property includes land (other than land that is exempt from taxation under this Act), and

(b) the taxable value of that land does not exceed $1,000,000, and

(c) the unit holders in the unit trust have fixed entitlements under the trust, and

(d) the units in the unit trust are family-owned.

(2) The unit trust continues to be a family unit trust in relation to each subsequent land tax year unless, before the commencement of that land tax year--

(a) the trust acquires additional land and, as a result of that acquisition, the taxable value of the land that is the subject of the trust (and that is not exempt from taxation) exceeds $1,000,000 (with the taxable value of the land being the taxable value for the land tax year during which the acquisition was made), or

(b) the unit holders cease to have fixed entitlements under the trust, or

(c) the units in the unit trust cease to be family-owned.

(3) If the unit trust ceases to be a family unit trust in relation to a subsequent land tax year, it cannot then become a family unit trust again (despite any changes in the land holdings or any other circumstances of the trust).

(4) Unit holders in a unit trust have
"fixed entitlements" under the trust if--

(a) the unit holders are entitled to a fixed proportion of the income or capital distributions of the trust (if any are made) based on the number or class of units owned by them, and

(b) the entitlements referred to in paragraph (a) cannot be removed, restricted or otherwise affected by the exercise of a discretion, or by a failure to exercise a discretion, conferred on any person under the trust.

(5) Units in a unit trust are
"family-owned" if--

(a) in the case of a unit trust where the units are owned by one person--

(i) the person is a non-trustee, or

(ii) the person is a family trustee, or

(b) in the case of a unit trust where the units are owned by 2 or more persons, not less than 95% of the units in the unit trust are owned by non-trustees or family trustees (or a combination of both) who are members of the same family.

(6) A person is a member of the same family as another person if--

(a) the person is married to the other person or is the de facto partner of the other person, or

Note : "De facto partner" is defined in section 21C of the Interpretation Act 1987 .

(b) the person is the child of the other person (whether by birth, adoption or marriage), or

(c) the Chief Commissioner is satisfied, on the basis of any other relationship between the persons, that they can be considered to be members of the same family.

(7) If a person owns a unit in a unit trust as a family trustee, the person is treated as a member of the same family as another person only if the beneficiaries of the trust of which the person is family trustee--

(a) are members of the same family as the other person, or

(b) if the other person is also a family trustee, are members of the same family as the beneficiaries of the trust of which the other person is family trustee.

(8) In this clause--


"family trustee" means a person who owns a unit in a unit trust as trustee of another trust which--

(a) has only one beneficiary, who is a natural person, or

(b) has 2 or more beneficiaries, who are all natural persons and members of the same family.

"non-trustee" means a natural person who owns a unit in a unit trust otherwise than as trustee of another trust.

(9) For the purposes of this clause, if a person owns a unit in a unit trust as trustee of a trust that is a superannuation trust in relation to the land tax year (within the meaning of section 3A), the members of that superannuation trust are taken to be beneficiaries of the trust.

3 Unit holders taken to be joint owners of land

(1) If a unit trust is a family unit trust in relation to a land tax year, the unit holders in that unit trust are taken, for the purposes of section 27, to be joint owners of the land that is the property of the trust--

(a) in the same proportion as the number of units held by them, or

(b) if there are different classes of units in the unit trust, in the same proportion as the number of units held by them of a class that entitle the holders to participate in capital distributions of the trust.

(2) This clause does not apply to unit holders in a unit trust which is a superannuation trust in relation to the land tax year (within the meaning of section 3A).