Attributable stakeholders for private trusts and private companies 043-04020100

Where a customer controls or has contributed to a private trust or private company, the income and assets of that company or trust may be attributed to the customer when assessing their entitlement to income support payments. Refer to Attribution for private trusts and private companies for more information.

The Private Trust form (MOD PT) or Private Company form (MOD PC) contains information that assists in determining whether the customer is an attributable stakeholder. Refer to Completing the Private Trust details in the MOD PT or Assessing and coding the Private Company details from the MOD PC for more information.

The relevant factors stipulated by legislation for making an attribution decision are:

• the strength of control available to be exercised (for example, whether control is shared)
• the exercise of control in practice
• whether any contributions have been made to the affected structure and their size in relation to the total assets of the structure
• the scope for the controller/s to benefit from distributions
• the history of distributions of capital and income from the structure
• the use and enjoyment of the assets and/or income from the structure
• any pre-existing or proposed attribution as determined by another Commonwealth department or agency (for example, Department of Veterans' Affairs)
• any other factor which, in the opinion of the Secretary, should be taken into account

If the customer is an attributable stakeholder of a private trust or private company, it will be necessary to show how the income and assets of the trust or company have been apportioned. For example, the percentage and/or dollar amount and to whom. It may be possible for a private trust or private company to have the income attributed in different percentages or dollar amounts than the assets attribution amounts. Refer to Attribution percentages for more information.

Attribution of the income and assets of a private trust and private company is based on the Control Test and the Source Test. Refer to Formal control of a private trust, Formal control of a private company, Informal control test and Source Test for more information on the application of these tests.

The source test may attribute the assets of a structure to a customer, if the customer transferred assets to that structure for inadequate consideration, or if the customer provides services to the structure for inadequate remuneration.

A source test is justified, as a person transferring assets to a structure generally does so because the assets will be used:

• for that person's benefit, or
• for their family's benefit, for example to shelter them from the means test while preserving their full value for the beneficiaries of their estate

A customer may pass the source test because they provided their property or services to a designated private trust after 7:30 pm Australian Eastern Standard Time (AEST) on 9 May 2000. The trust is therefore a controlled private trust from the perspective of this person, and the person is an attributable stakeholder of the trust and may be attributed with a 100 per cent income and asset attribution percentage.

The attribution decision will be made by a Complex Assessment Officer (CAO) and will be based on the individual circumstances of each case.

The CAO may decide, after considering section 1207X of the Social Security Act 1991 and all factors detailed in the disallowable instrument, entitled Social Security (Attributable Stakeholders and Attribution Percentages) Principles 2000, that this customer should not be attributed with the income or assets of the trust.

If the CAO wishes to have the decision to consider the customer an attributable stakeholder reconsidered, all relevant information and documents can be collated and a formal submission made to the National Income and Assets Helpdesk. The Helpdesk may consult with DSS where required.