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Resigning/relinquishing control of a trust or company or beneficial interest in a trust 043-04030080

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For Complex Assessment Officer (CAO) use only

This document outlines when a controller resigns control of a private trust or private company they will be treated in a manner comparable to other people who gift or relinquish personally held assets.

It also outlines what is required for a non-controller to relinquish their shares in a private company or beneficial interest in a private trust

On this page:

Controller resigns or relinquishes control

Non-controller relinquishes beneficial interest

Controller resigns or relinquishes control

Table 1

Step

Action

1

Attributed control of the private company or trust + Read more ...

Is the customer or partner attributed with control of the private company or private trust?

2

Resigning/relinquishing control + Read more ...

Has genuine resignation from a private trust or private company been accepted?

3

Genuine resignation accepted + Read more ...

  • Update the entity record for the resigning controller/s and partner on the Trust/Company Attribution(TRA) screen
  • Zero all income and assets attribution percentages for the resigning controller/s
  • DOC the record, include details of the new controller/s

Note: key 'I' for insert at bottom of the TRA screen to input a new date, using date of resignation.

Action the below steps for the resigning controller or beneficiary:

4

Genuine resignation not accepted + Read more ...

For a new claim:

  • A full assessment of the entity is required

For a current customer:

  • Update the entity with the most recent tax returns and financial statements
  • Contact the customer to discuss outcome and further steps required to consider genuine resignation in the future
  • DOC the record, for both the:
    • entity, and
    • customer/s

Procedure ends here.

Non-controller relinquishes beneficial interest

Table 2

Step

Action

1

Relinquishing beneficial interest of the private company or private trust + Read more ...

Has it been accepted that the customer or partner have relinquished their beneficial interest in a private company or private trust?

2

Relinquishment of beneficial interest accepted + Read more ...

  • Review and update the Trust/Company Distribution (TRD) screen, see Assessing and recording distribution income
  • Update the balance of any loans owing to the beneficiary on the Trust/Company Liabilities Summary (TRLS) screen. Make sure the required steps have been taken for loan forgiveness if applicable, see Loans
  • DOC the record, for both the:
    • entity, and
    • customer/s

Procedure ends here.

3

Relinquishment of beneficial interest not accepted + Read more ...

For a new claim:

  • A non-controller assessment of the entity is required

For a current customer:

  • Update the entity with the most recent distributions or dividends to the customer/s and current loan balances
  • Contact the customer to discuss outcome and further steps required to consider relinquishing their beneficial interest in the future
  • DOC the record, for both the:
    • entity, and
    • customer/s

Procedure ends here.