Last amended: 9 October 2006

Business structures

Income and assets are assessed differently for business structures, depending on the nature of the business structure. The three main categories of business structure are:

Current private trusts and companies rules

The contents of section 6 to section 18 relate to specific rules that apply to the assessment of income and assets of private trusts and private companies form 1 January 2002. Business structures such as partnerships and sole traders are subject to their own rules and are dealt with separately.

26 June 1992 changes to assessment for primary production


On 26 June 1992, a change was introduced to allow primary producers to offset the value of all their primary production liabilities against primary production assets. All assets in primary production and all liabilities relating to primary production are now aggregated, as if they were one asset and one liability. The reason for the change is that many primary producers have individual farm assets with a current market value less than the level of the debt secured against them, because the debt has not reduced as quickly as the asset has depreciated. Before 26 June 1992, the asset value for those assets was maintained as nil, and the excess debt could not be offset against positive values assessed for other farm assets.    

Summary of private trusts and companies

For the assets and income of a private trust or private company to be attributed to an individual the trust or company must be:

Pre 1 January 2002 trust and company rules

Whilst the new rules take effect from 1 January 2002, they do not replace the trust and company rules that applied prior to that date. The pre 1 January 2002 rules should be applied when calculating any assessable income or assets of a private trust or private company prior to 1 January 2002. This includes deprivation of an interest in a private trust or private company prior to 1 January 2002.    

Private trusts & private companies post 01/01/2002

Section 6 to section 17 deal with the treatment of private trusts and private companies from 1 January 2002 and contain information on:

Special Disability Trusts

Sections 18 and 19 relate to the rules applicable to special disability trusts (SDT). On 13 October 2005 the Prime Minister announced a package to assist families wishing to make private financial provisions for the current or future accommodation and care of a son or daughter with severe disability by contributing assets into a trust account. The package includes means test concessions for service pension and income support recipients who have reached pension age. These concessions apply where a trust has been established solely for the care and accommodation needs of a person with a severe disability.