If section 109UB or subdivision EA applies, will a dividend be taken to arise if the trustee pays over the present entitlement to the private company and it is then loaned back to the trust?
The rules applying to trust arrangements will not apply. However Division 7A may still apply to treat the loan as a dividend under the general rules. For example, if a private company loans the amount back to the trust and the trustee is an associate of a shareholder of the private company. (See the definition of ‘associate’ in sections 109ZD and 318.
Related Questions
- If section 109UB or subdivision EA applies, will a dividend be taken to arise if the trustee pays over the present entitlement to the private company and it is then loaned back to the trust?
- If section 109UB applies, what happens if the shareholder or shareholder’s associate repays the loan to the trustee?
- How is the deemed dividend determined under subdivision EA?
