C — 2010/4 As per paragraph 61, of PS LA 2010/4, the table below provides an overview of the three available investment options. Option 1 interest Option 2 interest Option 3 invest in a — — — only 7year loan only 10year loan specific income producing asset or investment Main trust to pay Main to pay Sub trust is entitled to receive Amount of the interest calculated at interest calculated at the share of net return (for annual return the Benchmark interest the Prescribed interest example, interest income or rate to the sub trust. rate to the sub trust. rental income) derived as a result of the specific asset or investment to the sub trust. Sub trust to pay annual return to the private company beneficiary by the lodgment day of the income tax return for the main trust except for the final payment of the annual return which must be paid to the private company when the investment or loan is due to be repaid. Interest. Interest. Depends on the specific Nature of the asset or investment. annual return The principal must be The principal must be The principal must be repaid Repayment of the repaid at the end of the repaid at the end of the by the lodgment day of the funds 7 year loan. 10 year loan. tax return of the private representing the company beneficiary for the UPE (the year in the investment principal) ends. Yes, the amount is Yes, the amount is No. Deductibility of deductible to the main deductible to the main the annual return trust provided that the provided that the trustee of the main trustee of the main trust satisfies section trust satisfies section 81 of the ITAA 1997. 81 of the ITAA 1997. Yes, the amount is Yes, the amount is Depends on the specific Assessability of assessable to the assessable to the asset or investment. the annual return private company private company beneficiary. beneficiary. Not required. Not required. Required. Subtrust tax return
C — 2010/4 As per paragraph 61, of PS LA 2010/4, the table below provides an overview of the three available investment options. Option 1 — interest only 7year loan Option 2 — interest only 10year loan Option 3 — invest in a specific income producing asset or investment Amount of the annual return Main trust to pay interest calculated at the Benchmark interest rate to the sub trust. Main to pay interest calculated at the Prescribed interest rate to the sub trust. Sub trust is entitled to receive the share of net return (for example, interest income or rental income) derived as a result of the specific asset or investment to the sub trust. Sub trust to pay annual return to the private company beneficiary by the lodgment day of the income tax return for the main trust except for the final payment of the annual return which must be paid to the private company when the investment or loan is due to be repaid. Nature of the annual return Interest. Interest. Depends on the specific asset or investment. Repayment of the funds representing the UPE (the principal) The principal must be repaid at the end of the 7 year loan. The principal must be repaid at the end of the 10 year loan. The principal must be repaid by the lodgment day of the tax return of the private company beneficiary for the year in the investment ends. Deductibility of the annual return Yes, the amount is deductible to the main trust provided that the trustee of the main trust satisfies section 81 of the ITAA 1997. Yes, the amount is deductible to the main provided that the trustee of the main trust satisfies section 81 of the ITAA 1997. No. Assessability of the annual return Yes, the amount is assessable to the private company beneficiary. Yes, the amount is assessable to the private company beneficiary. Depends on the specific asset or investment. Subtrust tax return Not required. Not required. Required.
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