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Assessable Income and Assets from Statutory Trusts pre 01/01/2002

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Assessment of income

The following table describes the assessment of income from statutory trusts.

If money is held by a public trustee or similar body...

Then...

on behalf of an individual person

the interest generated by its investment is the person's income. This is regardless of whether individual investment accounts are maintained or whether the property is held in a 'common fund'.

and no specific amount is held for the benefit of an individual person

Example: The property is held in common for the person and their children.

any interest credited to the investment account is not assessed as the person's income, until distributed or allocated to them.

Distribution of capital funds - income assessment

One-off payments made from the capital funds held by the trust are not taken into account as income.

Example: Distributions to enable modifications to be made to the person's principal residence to assist with their disability.

Assessment of assets

The following table describes the assessment of assets from statutory trusts.

If money is held by a public trustee or similar body...

Then...

on behalf of an individual person

the full value of that money is the person's asset.

Explanation: This is regardless of whether individual investment accounts are maintained or whether the property is held in a 'common fund'.

and a payment is made to a person out of the money held by the statutory trust and no specific amount is held for the benefit of an individual person,

Example: The property is held in common for the person and their children.

that payment is the person's interest, the asset in the account is an exempt asset.

Distribution of capital funds - asset assessment

One-off payments made from the capital funds held by the trust are the person's property and are assessed as an asset. The amount that is assessed as the assets held by the trust must be reduced by the amount of the payment.

Example: Distributions to purchase a vehicle for the person. The vehicle is the person's asset,

Statutory trusts for minors - assessment of income and assets

Payments to minors may be held on their behalf in a statutory trust.

Examples: Payments could include:

  • third party motor vehicle damages,
  • workers compensation after the death of their sole surviving parent, and
  • superannuation after the death of their sole surviving parent.

Money held in a statutory trust, on behalf of a minor, is the property of the minor, and interest credited to the account is their income.


Statutory trusts are:

created by law,

usually established to look after the affairs of a customer who is incapable, or legally unable to attend to their own affairs, and

exist if property is held by:

  • public trustees,
  • Workers Compensation Boards, and
  • courts.

Explanation: Although the description of 'statutory trust' is applied, a trust in the strictest sense is not created. The Federal Court in Flannery v Secretary of the Department of Family and Community Services has recognised the public trustees and similar bodies are managers rather than trustees of peroperty.

Damages is the economic value of something lost or withheld. For compensation purposes, damages is the sum awarded for any loss or injury that has been sustained.