Unresolved stamp duty issues undermine trust tax reforms
Chartered Accountants ANZ
28 September 2026
Chartered Accountants Australia and New Zealand has welcomed greater flexibility in the Government’s revised discretionary trust tax proposal, but warns unresolved stamp duty and trust law issues could undermine its effectiveness and leave family businesses facing significant costs and uncertainty.
The latest exposure draft includes a new option that allows some discretionary trusts to remain within their existing structure, rather than transferring assets into a company or fixed trust under the proposed rules.
CA ANZ Tax, Superannuation and Financial Services Leader, Susan Franks, said the additional flexibility was a positive step, but further work was needed to make the reforms practical and effective.
"Providing an alternative to costly trust restructures is welcome, but important questions remain around stamp duty and trustee obligations,” Ms Franks said.
"Family businesses could still face significant costs associated with legal advice, valuations, trust deed reviews and state tax issues."
"If businesses need extensive legal advice to use the new option with confidence, the compliance burden has not been removed."
CA ANZ is urging the Government to work with state and territory revenue offices to obtain clear rulings or commitments on duty consequences for both alternatives.
The new option also interacts with existing family trust election provisions, which CA ANZ says require reform if the new regime is to operate effectively.
“This new alternative cannot be expected to work properly if it is constrained by the rigid family trust election rules that already create practical problems for compliant family groups," Ms Franks said.
“This is the time to fix those provisions, not entrench their weaknesses in a new regime."
CA ANZ has also called for a specific GST exemption for qualifying roll-over transactions to prevent GST increasing the stamp duty base and effectively creating a tax-on-tax outcome.
More broadly, CA ANZ says key elements of the regime remain unresolved, making it difficult for taxpayers and advisers to assess how the proposed rules will operate in practice.
"When major tax changes are released in pieces, it becomes difficult to test whether the full package will work as intended," Ms Franks said.
"The Government should commit to addressing unintended consequences quickly and reviewing the law after commencement."
CA ANZ also raised concerns about the proposed implementation timetable and its impact on tax agents.
"Tax agents are being asked to help implement significant reform while continuing to meet their clients' ordinary compliance obligations," Ms Franks said.
"We need practical discussions with the ATO about how reform implementation and business-as-usual work can both be delivered effectively."
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