| . |
| Income for Minors |
|
|
|
Prescribed minors Taxed at ordinary marginal tax rates Excepted minors Taxed at Division 6AA penalty rates of tax, unless income is excepted assessable income which is taxed at ordinary marginal tax rates Division 6AA tax rates
S100 Credit When a beneficiary has income from more than one trust or from other sources (e.g. salary, rent, interest or dividends): To prevent double taxation, a beneficiary is entitled to a credit against the total tax assessed for the tax paid or payable by the trustee in relation to the beneficiary's interest in the net income. The credit cannot exceed the tax otherwise payable by the beneficiary, even though the trustee assessment may bave been for a greater amount. |
| Income for Minors |
|
The ATO has designed rules for the taxation of income for non-working unmarried people who are under 18 at the end of the financial year. These rules are designed to discourage diverting income to minors by "income splitting" Prescribed minors s.102AC(1) ITAA36 defines a prescribed person as "any person under 18 at the end of the year of income who is not an excepted person" Excepted minors a person who is classified as being in a "full-time occupation" i.e. engaged in a full-time occupation on the last day of the year of income, or engaged in full-time employment for at least three months of the income year a double orphan or a permanently disabled person, provided they are not dependent on a relative for support an incapacitated child in respect of whom a carer allowance or a disability support pension was paid or would, but for eligibility tests, be payable Excepted assessable income Under s.102AE(2) ITAA36 excepted assessable income of a minor includes: employment income such as wages, salaries, payments made for services rendered business income (provided the minor has real and effective control over their share of the business income) income derived from the investment of:
excepted trust income (i.e. income from deceased trust estates) |