Trusts: Current Tax Issues in Practice
Presenters : Piet Nel
Overview
Understanding who is liable for income tax within a trust structure is fundamental to effective tax and estate planning. Depending on the trust’s formation, funding, and administration, the taxpayer could be the founder (donor), a beneficiary, or the trust itself. These distinctions influence tax liability, provisional tax obligations, and financial statement disclosures. This video breaks down these critical factors to clarify tax responsibilities and improve compliance.
Video Content
Part 1:
- Different types of trusts and their tax implications
- Trust capitalization and tax consequences
- Donor funding and Section 7C calculations
- Provisional tax considerations for trusts
Part 2:
- Distinguishing attribution, vesting, and distribution
- Explaining the conduit principle
- Trustees’ responsibilities and required documentation
- Tax practitioners’ duties for accurate disclosure
Competencies Developed
- Identify trust types and understand their tax impacts
- Recognize when donors, beneficiaries, or trusts are taxpayers
- Apply the conduit principle to assign tax liability correctly
- Calculate attributed, vested, and distributed income and capital gains
- Appreciate the importance of proper documentation and accurate disclosures