The ATO has confirmed they are targeting trustees that have failed to lodge TFN reports with them. A TFN report is to be completed by the trustee of a closely held trust to report tax file numbers (TFNs) and other personal details quoted to them by beneficiaries of the trust. Closely held trusts include all discretionary trust and broadly speaking unit trust with fewer than 20 unit holders so the requirement to have lodged a TFN Report relates to most trust structures. 

You must lodge a TFN report for the quarter the beneficiary quotes their TFN to you. Should a beneficiary of a closely held trust not disclose their TFN to the trustee then the trustee is required to withhold on any trust distribution to that beneficiary. The report is due by the last day of the month following the end of the quarter in which the TFN was quoted (or within such further time as the Commissioner allows). For example, if a TFN was quoted in the July-September quarter, the report would be due on or before 31 October.

Unfortunetly the ATO has not provided Tax Agents with appropriate resources to investigate if trustees have already completed a TFN report. We at GMD Advisory have been communicating with all clients that hold closely held trusts and notifying/re-notifying the ATO to ensure compliance and reduce the risk of penalties for non-compliance. 

If you would like assitance preparing a TFN Report for your closely held trust please contact your GMD Advisory team member.