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Exposure Draft - Tax Laws Amendment (2010 Measures No. 3) Bill 2010: Managed Investment Trust (MIT)


Friday, 16 April 2010

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On 16 April 2010, the Assistant Treasurer released for public consultation the exposure draft legislation that will amend the definition of a managed investment trust (MIT) in relation to withholding tax rules.

The amendments were announced on 10 February 2010, in Media Release No. 20 of 2010. The Government also proposes Parliamentary amendments to Tax Laws Amendment (2010 Measures No. 1) Bill 2010 which recently introduced Division 275 to the Income Tax Assessment Act 1997 (the MIT capital measure).

Together, these amendments will effectively replace the proposed extension of the definition of a MIT for the proposed MIT capital measure to both wholesale funds and government-owned managed investment schemes, with a more targeted application of the MIT withholding tax rules to include both wholesale managed investment schemes and government-owned managed investment schemes.

The proposed changes also amend the MIT withholding tax definition to introduce a trading business test for trusts that would otherwise qualify as a MIT, to clarify the operation of the definition where there is only one member, and to clarify that the management of the trust must be maintained onshore.

Amendments are also proposed to ensure the MIT withholding tax rules are appropriately targeted at widely held trusts.  This includes the introduction of a rule to exclude closely held trusts, and the addition of certain widely held pooled superannuation trusts to the list of specified widely held entities in Subdivision 12-H of Schedule 1 to the Taxation Administration Act 1953.

Making a submission

Interested parties are invited to comment on the exposure drafts. While submissions may be lodged electronically or by post, electronic lodgement is preferred. For accessibility reasons, please submit responses sent via email in a Word or RTF format. An additional PDF version may also be submitted.

All information (including name and address details) contained in submissions will be made available to the public on the Treasury website unless you indicate that you would like all or part of your submission to remain in confidence. Automatically generated confidentiality statements in emails do not suffice for this purpose. Respondents who would like part of their submission to remain in confidence should provide this information marked as such in a separate attachment. Legal requirements, such as those imposed by the Freedom of Information Act 1982, may affect the confidentiality of your submission.

Closing date for submissions: Friday, 23 April 2010

Address written submissions to:
International Tax Framework Unit
International Tax and Treaties Division
The Treasury
Langton Crescent

Fax: 6263 4352

Email: MIT@treasury.gov.au

For enquiries, please call Lisa Clifton (02) 6263 4451.

Documents Available:

Acrobat (PDF) documents

 Acrobat (PDF)

Exposure Draft - Managed Investment Trust  33.78kb
Exposure Draft - Parliamentary Amendments  18.07kb

Microsoft Word (RTF) documents

 Microsoft Word (RTF)

Exposure Draft - Managed Investment Trust  112.18kb
Exposure Draft - Parliamentary Amendments  73.01kb

Related Items:

Submissions: Exposure Draft - Tax Laws Amendment (2010 Measures No. 3) Bill 2010: Managed Investment Trust (MIT) - 23/07/2010

Treasury has received fifteen submissions in response to its consultation on the Tax Laws Amendment (2010 Measures No. 3) Bill 2010: Managed Investment Trust (MIT) – Exposure Draft. There were eleven public submissions, and four confidential submissions. The public submissions are listed below and are accessible by selecting the author.

The opinions expressed in the submissions are those of the authors and do not necessarily reflect the views of the Government or the Treasury.

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