A quick look at something Noel Whittaker has written this month, and what it means if you're somewhere between 40 and 60.
If your family runs a discretionary trust — or you are a beneficiary of one and have never quite worked out what that means — there has been a shift worth knowing about. In his September newsletter, Noel Whittaker looks at Treasury's change of heart on family trusts.
The background: Treasury had proposed a minimum 30% tax on the income of discretionary trusts, which would have stripped away much of the reason many families use them. That proposal has now been softened. Trustees can avoid the minimum tax by making an election to direct a fixed proportion of the trust's income to specified beneficiaries.
The catch sits in the word "fixed". Once the election is made, it cannot be undone.
"Once income must be distributed in fixed proportions to specified beneficiaries, a discretionary trust is no longer truly discretionary."
That matters more than it first sounds. The whole value of a discretionary trust is its ability to respond to life as it actually unfolds. A daughter drops to part-time work after a baby. A son loses his job, starts a business, or goes through a divorce. Under the usual arrangement, a trustee can direct income to where it does the most good and attracts the least tax that year. Under a permanent fixed election, the income keeps landing in the same hands regardless of what has changed — and an election signed in 2026 has to work for a family in 2040.
If there is a trust in your family, this is a conversation to have with your accountant before anything is signed rather than afterwards. It is the kind of decision you only get to make once.
Read the full article: Noel News September 2026 — Noel Whittaker, Noel News, September 2026.
Trusts, wills and the tax that follows you out the door all live in the same corner of the map. Wills, Death & Taxes Made Simple is Noel Whittaker's plain-English guide to estate planning in Australia — buy direct from the author for $22.95 and you will receive it in both PDF and EPUB formats to read on any device.