Trust Resolutions – Why Timing and Documentation Matter

A recent Tribunal decision has highlighted how poor timing and weak documentation can unravel even the best-laid trust strategies. The case of Goldenville Family Trust v Commissioner of Taxation [2025] shows just how high the stakes can be.

📅 The Issue: Late or Undocumented Resolutions

The trustee tried to distribute trust income to a non-resident to reduce tax. But the Tribunal found the distribution resolutions invalid — they weren’t documented properly by 30 June.

Even though documents were signed and dated “30 June”, the Tribunal ruled they were likely prepared months later, once the financials were ready. The result? The income was taxed to default resident beneficiaries at higher rates .

🔁 Similar Risks: Division 7A Loans

If you’re using loan set-offs involving dividends, the ATO also requires proof of:

• When the dividend was declared, and
• When the parties agreed to the set-off

Miss these steps, and you could trigger a deemed unfranked dividend.

📝 Takeaway

To keep your tax planning airtight:

• Make real decisions by the deadline
• Capture contemporaneous evidence (e.g. meeting notes, timestamped emails)
• Finalise paperwork as soon as possible, ensuring it reflects the actual decision

👉 Need help with year-end trust resolutions or Division 7A planning? Reach out early so we can ensure you’re protected.