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Private Trusts and Private Companies

If you are involved in a private trust or company, Centrelink may include the income and assets of that trust or company when working out your social security payments.

The assets and income of private trusts and private companies may be "attributed" to a person based on:

• a control test, and
• a source test where a person transfers assets or services to a trust or company after 7.30 pm on 9 May 2000.

If you are NOT a controller of a private trust or private company any actual distributions or dividends (including imputation credits) you receive will be assessed as income for 12 months after the date of distribution.

Involvement in a private trust

You will be considered to be involved in a private trust if you or your partner are:

• the appointor, guardian or principal of the trust
• a trustee
• a shareholder or director of the trustee company
• a beneficiary
• a unit holder
• owed money by the trust
• have provided, for less than market value, property or services to the trust since 9 May 2000
• are able to benefit from the trust
• can expect a trustee or appointor of a trust to act in accordance with your wishes.

Involvement in a private company

You will be considered to be involved in a private company if you or your partner are:

• a shareholder, director or other office holder of the company
• are owed money by the company
• have provided, for less than market value, property or services to the company since 9 May 2000
• are able to benefit directly or indirectly from the company
• can expect the office holders of the company to act in accordance with your wishes

Loans to private trusts or private companies

If you have loaned money to a private trust or private company the amount of the loan will be treated as your personal financial asset and be subject to the deeming rules.

Relinquishing control of a private trust or private company

If you relinquish control of a private trust or private company on or after 1 January 2002 without receiving adequate consideration, you will be considered to have gifted the assets held by the trust or company. Gifts may be assessed for 5 years from the date of transfer and deemed income will apply.

The private trusts and private companies rules do not apply to:

• Managed investment trusts
• Shares in public companies
• People who operate a business as a sole trader or through a partnership.

More Information:

• Go to the Financial Information Service Publications

For information on the Trusts and Companies Legislation, including the associated Disallowable Instruments, visit the Department of Families, Community Services and Indigenous Affairs (FaCSIA) website.

PDF Forms:

• Go to the Private Trust details form
• Go to the Private company details form

Note: These forms are current at time of publishing. To ensure that you are using the latest versions please check this page regularly.