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Australia Consulting on Regulatory and Tax Frameworks for Corporate Collective Investment Vehicles — Orbitax Tax News & Alerts

The Australian Treasury has launched a public consultation on draft legislation that implements the tax and regulatory components of the corporate collective investment vehicle (CCIV) regime and related explanatory materials. As provided in the explanatory materials, key points concerning the tax treatment of CCIVs include the following:

  • The draft legislation amends the taxation law to specify the tax treatment for the newly established CCIV, which gives effect to the core CCIV tax framework with the objective that the general tax treatment of CCIVs and their members align with the existing tax treatment of attribution managed investment trusts (AMITs) and their members;
  • The CCIV tax framework achieves this objective by leveraging the existing trusts taxation framework and the existing attribution flowthrough regime (i.e., the new tax system for MITs, or the AMIT regime), rather than by creating a new bespoke tax regime;
  • Where the CCIV meets the AMIT eligibility criteria in respect of a sub-fund, then the CCIV will be able to attribute amounts of assessable income, exempt income, non-assessable non-exempt income, and tax offsets derived or received by the CCIV that have a particular character to members, with those amounts retaining that character and recognised (taxed) in the hands of each member; and
  • Where a CCIV does not satisfy the AMIT eligibility criteria in respect of a sub-fund for a particular tax year, then the CCIV tax treatment will generally default to the general trusts taxation framework for that year.

The consultation runs until 24 September 2021.