The ATO’s Stance on Capital Gains, Discretionary Trusts and Foreign Residents

In the decisions of Greensill (Thawley J) and Martin (Steward J), the Federal Court found in favour of the Australian Taxation Office (ATO) that section 855-10 of the Income Tax Assessment Act 1997 (ITAA 1997) did not disregard a non-taxable Australian property capital gain distributed to a foreign beneficiary of an Australian discretionary trust.