Attribution for private trusts and private companies 043-04030000

From 1 January 2002, the way private trusts are assessed under the income and assets tests changed. Where a customer is an attributable stakeholder of a private trust or private company, the income and assets of that private trust or private company may be taken into account (attributed to the customer) when assessing their entitlement to any income support payments or concessions.

Attribution was introduced in the 2000/2001 Federal Budget. For means testing purposes, attribution ensures that customers who hold their assets in private companies or private trusts receive comparable treatment to those customers who hold their assets directly.

Where a customer controls or has contributed to a private trust or private company, the income and assets of that trust or company may be attributed to the customer when assessing their entitlement to income support payments or concessions. If it is a controlled private trust or controlled private company for the customer, then the customer is an attributable stakeholder of the private trust or private company, unless a CAO determines otherwise. See Attributable stakeholders for private trusts and private companies.

Attribution of the income and assets of a private trust or private company is based on the Control Test and Source Test. See Formal control of a private trust, Formal control of a private company, Informal control test and Source Test on the application of these tests.

All means tested income support payments made under the Social Security Act 1991 and the Veterans' Entitlements Act 1986 may be affected by attribution.

Note: the rules do not affect Taxation or Corporations Law.

Centrelink customers and their partners (whether residing within or outside Australia) claiming or in receipt of income support payments and some concessions may be affected by the attribution rules. The following are not affected by the attribution rules:

• Commonwealth Seniors Health Card (CSHC) entitlement
• Family Tax Benefit Part A and B entitlement
• Carer Allowance (CA)
• customers on Disability Support Pension (Blind) or Age Pension (Blind) (who do not receive Rent Assistance or do not have a partner on a means tested payment) as they are not affected by either Means Test

Residential Care Assessments (RCA) customers who entered care:

• prior to 1 July 2014 are only affected by income attribution, not asset attribution
• on or after 1 July 2014 require an income and asset assessment

The delegation for the attribution decision is always with the Complex Assessment Officer (CAO).

An attribution decision may impact on the payability of an income support payment, that is, the rate of payment.

The delegation for the determination of a customer's qualification for an income support payment or other entitlement (such as concession cards) is with the Service Officer.

If a person is not qualified for payment it is not necessary to refer the case to the CAO for an attribution assessment. For example, to be qualified for JobSeeker Payment (JSP) a person needs to be unemployed. If a person is not unemployed, they are not qualified for JSP.

The legislation sets out a three step process for the attribution of the income and assets of a private trust or private company to an individual:

• the private trust or private company must be a designated private trust or a designated private company
• the designated private trust or designated private company must be a controlled private trust or private company for the individual. See Formal control of a private trust, Formal control of a private company or Informal control test
• the individual must be an attributable stakeholder of the designated private trust or designated private company. See Attributable stakeholders for private trusts and Attributable stakeholders for private companies

In making the attribution decision the CAO must take into account the formal control of the designated private trust or designated private company, the informal control and the source test.

When making a decision as to the percentage of attribution of a structure to a stakeholder, the CAO must refer to the relevant (attribution) decision making principles. These are in the Social Security (Attributable Stakeholders and Attribution Percentages) Principles 2017.