Colonial First State Investments Limited v Commissioner of Taxation [2011] FCA 16

FEDERAL COURT OF AUSTRALIA

Colonial First State Investments Limited v Commissioner of Taxation [2011] FCA 16 Citation: Colonial First State Investments Limited v Commissioner of Taxation [2011] FCA 16

Parties: COLONIAL FIRST STATE INVESTMENTS LIMITED (ACN 002 348 352) v COMMISSIONER OF TAXATION

File number: NSD 1190 of 2009

Judge: STONE J

Date of judgment: 18 January 2011

Catchwords: INCOME TAX – unit trust – managed investment fund – private ruling – notice of objection – objection disallowed – whether proposed amendments to trust deed will have tax consequences contended by applicant INCOME TAX – unit trust – redemption of units before end of financial year – short term capital gains – long term capital gains – trustee's discretion to appropriate amount from particular accounts following end of financial year – whether redeeming unitholder is 'presently entitled' to amount in excess of the subscription amount – whether entitlement arises during the same tax year as the income is derived INCOME TAX – unit trust – managed investment fund – redemption of units – whether amount paid on redemption which is in excess of subscription amount forms part of the income of the trust estate – whether this amount is a 'share' or 'proportion' of the income of the trust – whether beneficiary is entitled to an allowable deduction in relation to that amount – whether that amount is a capital gain to be taken into the calculation of the net income of a beneficiary INCOME TAX – capital gains – whether on redemption the beneficiary makes a gain upon the occurrence of a CGT Event C2 INCOME TAX – unit trust – retention of unit where other unitholders redeem units – whether amount paid to redeeming unitholders which is in excess of the subscription amount comprises part of the net income of the trust estate – whether that amount forms part of the assessable income of unitholder which has retained units – whether part of net income which has not been distributed during tax year is equal to the share of the distributable income to which the continuing unitholder is entitled TRUSTS AND TRUSTEES – unit trust – managed investment fund – whether interposition of custodian prevents responsible entity from being a beneficiary TRUSTS AND TRUSTEES – whether constitution of managed investment fund empowers trustee to characterise as income that which may not otherwise be so characterised TRUSTS AND TRUSTEES – unit trust – whether trust is a fixed trust – whether each beneficiary has a fixed entitlement