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Assessment of liabilities for trust and companies 043-04090010

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This page contains scenarios showing how the Income and Assets Tests are applied according to each type of liability and a table that summarises how the liabilities of trusts and companies are treated.

Scenarios

\\INTERNAL.DEPT.LOCAL\Shared\NAT\SERDELEXCEL\WORKPRODIMP\Operation Blueprint Migration\RDT Release Icons\32w\icon-attachment.pngScenarios showing how the Income and Assets Tests are applied according to each type of liability

Treatment of liabilities

How liabilities of companies and trusts are treated

This table describes the treatment of liabilities of trusts and companies.

Item

Liability in respect of

Acceptable liability acknowledgement

No acceptable liability acknowledgement

Treatment of asset

1

Financial institutions, banks and finance companies

Recognised as an entity liability

Recognised as an entity liability

N/A - the loan would be an asset of the institution

2

Genuine third party

Recognised as an entity liability

Not recognised as an entity liability

Loan/debt is an asset of the third party:

  • loan is deemed
  • debt is not deemed

3

Associate

Recognised as an entity liability

Not recognised as an entity liability

Loan/debt is an asset of the associate:

  • loan is deemed
  • debt is not deemed

4

100% controller or partnered couple who have 100% control

Recognised as an entity liability

Recognised as an entity liability

Loan/debt is an asset of the controller(s):

  • loan is deemed
  • debt is not deemed

5

Part controller

Recognised as an entity liability

Not recognised as an entity liability

Loan/debt is an asset of the controller(s):

  • loan is deemed
  • debt is not deemed

6

Minor

Not recognised as an entity liability

Not recognised as an entity liability

Loan/debt is an asset of the minor:

  • loan is deemed
  • debt is not deemed