New Tax System for Managed Investment Trusts – Bill introduced
The government introduced Tax Laws Amendment (New Tax System for Managed Investment Trusts) Bill 2015 (the AMIT Bill) into Parliament.
On 3 December 2015 the government introduced Tax Laws Amendment (New Tax System for Managed Investment Trusts) Bill 2015 (the AMIT Bill) into Parliament.
The AMIT Bill removes some of the disincentives of being an AMIT contained in the Exposure Draft released on 9 April 2015 (the ED), makes it easier for a managed investment trust (MIT) to qualify as an AMIT and provides that the AMIT regime is elective from 1 July 2015. It is therefore expected that managers will view the AMIT regime as more attractive, although the timing for making the election will need to be carefully considered, both in terms of the impact of the changes on members, as well as the adequacy of current processes, controls and systems. The AMIT Bill also introduces opportunities to create new types of fund products using the election to treat classes of units as separate AMITs.
The AMIT Bill contains a number of amendments, including the non-arm’s length income rule (NALIR), which will apply to all MITs, even where no AMIT election has been made. These changes apply from 1 July 2016, or from 1 July 2015 if an AMIT election has been made.
The following Tax Insight provides a high level summary of the AMIT Bill to assist you in considering the impacts of the AMIT Bill on your current and future funds. It also details various proposed trustee taxation provisions which are part of the AMIT Bill.