ATO Tightens Focus on Trusts and Wealth Structures

The ATO is paying closer attention to how income, assets and wealth are structured — particularly where trusts and family groups are involved.

While much of the focus is on higher-wealth taxpayers, many small business owners and professionals could also be affected.

Key Areas the ATO is Watching

Trusts and Family Groups

Errors in family trust elections and distributions can trigger unexpected tax and interest. The ATO is encouraging voluntary disclosures to correct past mistakes.

Tip: A review of trust structures and past distributions is worthwhile.

Income Splitting

The ATO is targeting arrangements that shift income to family members on lower tax rates where it doesn’t reflect real work or commercial arrangements.

Tip: Income allocations should match genuine involvement.

Business Structures

Arrangements involving companies, trusts and “bucket companies” are under greater scrutiny, especially where they reduce overall tax.

Tip: Structures should be commercially driven, not just tax-driven.

Our Takeaway

Well-structured arrangements are still legitimate — but they must be carefully managed and documented.  A proactive review now can prevent surprises later.

Contact your Client Manager if you would like a review of your structures and ensure everything is in order.