Search this site

Could some of Australia’s $21 billion belong to you? More than $21 billion in lost and unclaimed superannuation is currently sitting idle across Australia, according to the latest ATO figures. The average lost account holds around $41,000. Last year alone, the ATO reunited more than $1.1 billion with members. That is real money that could be working harder for your retirement. Tax time is a natural moment to check if any of it belongs to you. How does super become “lost”? Super generally becomes lost when an account becomes inactive and the fund can no longer contact the member. Common triggers include: Changing jobs and leaving an old account behind; Moving house or updating your phone number without telling the fund; and Changing your name. When the fund cannot reach you, the account may be classified as lost. In some cases, the balance is eventually transferred to the ATO to hold until the rightful owner claims it. The money does not disappear; it simply sits waiting to be reunited with its owner. How can you find lost super? Finding lost super is straightforward and free. The quickest way is through ATO online services via myGov: Log in to myGov and open the ATO section. Select Super, then Fund details. You will see any active accounts plus any lost or ATO-held super linked to your tax file number. You can also use the ATO app or call the automated lost super search line on 13 28 65. A paper form is available if you prefer. Many people are surprised by what turns up: old accounts from early jobs, small balances that have grown over time, or larger amounts they had completely forgotten about. Why is finding lost super especially valuable near retirement? For clients still decades from retirement, finding lost super is useful. For those at or approaching retirement age, it can be particularly meaningful. An extra $20,000 or $40,000 (or more) can make a noticeable difference to the size of the nest egg available to draw on. Even smaller amounts can compound further once consolidated into a single active account that continues to earn returns and attract any future contributions. What should you check before consolidating super accounts? Check the insurance cover attached to each account before rolling multiple accounts into one preferred fund. Death, total and permanent disability, or income protection cover that comes with a super account can sometimes end when the balance is rolled over. Losing that cover without realising it can leave a gap in your protection at the exact time you may need it most. Speak with your fund or adviser before consolidating so you understand exactly what will transfer and what will not. What are the potential benefits of consolidating lost super? Every dollar sitting in a lost or low-balance account is potentially earning less than it could, or incurring unnecessary fees. Bringing the money into one active account usually: Reduces fees; Improves investment choice; and Makes it easier to keep track of your overall position. The ATO’s reunification figures show that when people do the search, meaningful amounts are regularly returned. The process takes only a few minutes and costs nothing. Given that more than $21 billion is currently waiting to be claimed, the odds that some of it belongs to you are higher than many people expect. Start your free lost super search You can start the free search through the ATO’s guide to searching for lost superannuation » For help interpreting what you find, or advice on if consolidation makes sense in your circumstances — including the insurance check — get in touch with Collins Hume on 02 6686 3000. A short conversation now can put money back into your retirement savings that might otherwise stay forgotten.

Nathan McGrath joins Business Lismore panel to explore business strategy Collins Hume's Senior Business Advisor and Business Valuation Specialist, Nathan McGrath, recently joined a panel of business experts for Business Lismore's October Business Before Hours event, exploring the importance of strategy in building sustainable, successful businesses. With more than 30 years' experience helping businesses improve performance and build long-term value, Nathan brought his practical business advisory expertise to the discussion. Turning business strategy into action The panel explored how business owners can develop, implement and adapt strategies to support sustainable growth. Key discussion points included: Strategic clarity: Having a clear vision and maintaining direction as your business evolves. Understanding customers: Knowing your target market and aligning your business operations with customer expectations. Sustainable growth: Developing reliable systems and identifying opportunities to grow without overwhelming daily operations. Long-term value: Looking beyond immediate results to build a stronger, more resilient and valuable business. Measuring progress: Reviewing results and adjusting strategies to keep your business moving in the right direction. Nathan was joined by Anthea Stevanovic from Intelligent Directions, Carol Liang from Adacy and Mike Ewing from Southern Cross University. "It was great to be a part of the panel and bring some linkages between strategy, performance, clarity and confidence to make strategic decision that improve business value," said Nathan. The morning also included an interactive Q&A session, giving local business owners an opportunity to discuss the practical challenges of developing and implementing business strategies. Thank you to Business Lismore for bringing together local business leaders and creating an opportunity to share knowledge and ideas. Take the next step towards a stronger business If you missed the discussion, our Business Risk Survey is a useful starting point to identify potential risks and gain insights that can help inform your business strategy and build a stronger, more sustainable business. You’re also welcome to contact Nathan McGrath and our Strategy360 team at Collins Hume on 02 6686 3000 for a conversation about your business and the opportunities ahead. Photo credits: Business Lismore

ATO travel data matching If you spend time outside Australia for work, family or personal reasons, your travel history could become increasingly important when it comes to your Australian tax affairs. On 24 August 2026, the ATO gazetted its latest passenger movements data-matching program. Under the program, the Department of Home Affairs is expected to provide the ATO with travel information for around 115,000 individuals each year, from the 2026–27 income year through to 2028–29. The information may include an individual’s: Name and date of birth Arrival and departure dates Passport details, and Citizenship or visa status. The ATO can then compare this information with its own records to identify potential issues with tax residency, registration, lodgement, reporting and payment obligations. For taxpayers who regularly travel overseas, one of the most important areas to consider is their tax residency position. Why does Australian tax residency matter? Your Australian tax residency status can have a significant impact on how you are taxed. For example, Australian residents are generally taxed on their worldwide income, while foreign residents are generally taxed only on their Australian-sourced income. Residency can also affect the tax-free threshold, Medicare levy obligations and capital gains tax (CGT) outcomes. This means that if you have moved to or from Australia, or spent extended periods overseas, the exact dates you entered and left Australia can be important when preparing your tax return. The ATO will now have access to passenger movement information from an independent government source. If the dates reported by a taxpayer do not appear to align with those records, this could potentially prompt the ATO to seek further information. Spending time overseas does not automatically make someone a foreign resident for tax purposes. Tax residency is determined by considering a range of factors, including family circumstances, the strength of connections with Australia and someone’s intentions and behaviour. However, accurate travel records can be an important part of establishing the overall position. When could your travel history matter for tax? There are several situations where keeping accurate travel records could be particularly useful. Becoming or ceasing to be an Australian tax resident If you became or ceased to be an Australian tax resident during the year, the dates you arrived in or departed Australia may form part of the evidence supporting your residency position. They can also be relevant when determining if a part-year tax-free threshold applies. Working overseas If you regularly travel overseas for work, your travel history may help establish when you were working in Australia and when you were overseas. This can be particularly relevant where your tax position involves foreign employment income, work-related travel or other overseas activities. Selling an Australian property after moving overseas If you have moved overseas and later sell an Australian property, your residency history can be relevant to the CGT treatment. An individual’s tax residency status can have a significant impact on if the main residence exemption can apply on the sale of their home. Keeping a clear record of when you were living in Australia and when you were overseas can therefore be helpful. What travel records should you keep? There is no need to be concerned simply because you travel overseas. However, if you spend significant periods outside Australia, it is worth making sure your records are accurate and consistent. As a practical starting point: Record your travel dates: Keep a record of your arrival and departure dates for each trip, including the year in which the travel occurred. Retain supporting documents: Keep useful records such as flight itineraries, boarding passes and passport records where available. Tell us about significant overseas stays: Let us know about significant periods spent overseas, particularly if you have moved overseas or are considering doing so. Check dates before lodging: Before lodging your tax return, check that the dates used in any residency calculation or other relevant tax treatment are accurate. Good record-keeping is particularly important where your residency position is not straightforward. If there is a difference between the dates you have reported and the information available to the ATO, having supporting records can make it much easier to explain the position. How could accurate travel records help you avoid ATO queries? For most taxpayers, the ATO’s passenger movements data-matching program is unlikely to have any direct impact. However, for people who regularly travel overseas, have moved countries or have a residency position that is finely balanced, accurate travel records could become increasingly valuable. Rather than waiting for the ATO to raise a query, it is worth discussing your circumstances with us if you have spent substantial time overseas during the year or plan to in the near future. A few minutes spent checking your travel dates and residency position could help avoid unnecessary questions later and provide greater confidence that your tax return accurately reflects your circumstances. Spent time overseas? Check your tax position before lodging Contact Collins Hume to review your travel records and Australian tax residency position before lodging your tax return. If you have moved overseas, regularly travel for work or plan to sell an Australian property while abroad, we can help you understand how your circumstances affect your tax obligations and the records you need to keep.

Behind every successful professional services firm are the people making sure the technical team has the systems, support and resources to do their best work. At Collins Hume, Business Manager Naomi Monk is one of those. Since joining Collins Hume in 2017, Naomi has progressed through admin and management roles into senior leadership, overseeing the operations supporting Collins Hume's 30+ team and our clients across Ballina and the Northern Rivers. Her responsibilities span planning, operations, client service management, compliance, workflow, payroll, office administration, IT and resource planning. She is also a key link between Partners, Team Leaders, accountants, administration staff, clients and external parties. When Naomi was appointed Business Manager in 2024, she said she wanted to “continue to challenge and push the boundaries of what's possible for Collins Hume's clients and our business.” Her work since then shows how that ambition translates into everyday practice. Building a stronger, more efficient business Naomi has led or coordinated significant operational improvements across Collins Hume, including IT security upgrades, migration to cloud-based systems, secure digital document processes, database improvements, administration KPIs and new Standard Operating Procedures. She has also helped maintain the technology infrastructure that enables team members to work fully remotely, while providing other employees the flexibility to work from home. These improvements have a direct bearing on client service. Better workflows, stronger cybersecurity, reduced system downtime and easier access to information give Collins Hume's accountants and advisers greater capacity to focus on our clients. Naomi has also improved administration and workflow within Collins Hume, moving manual processes to the cloud and introducing more efficient document management and software systems. Helping people succeed Technology and processes are only part of Naomi's contribution. She manages the onboarding of new employees, mentors trainees and helps staff navigate change across the business. Her colleagues describe her as organised, fair, empathetic and solution-focused – someone who is willing to help find a way forward and who genuinely wants the people around her to succeed. That leadership style reflects Collins Hume's Human to Human approach: combining high professional standards with an understanding of the people behind the work. Turning values into action Naomi is also a strong advocate for Collins Hume's commitment to purposeful and sustainable business. She has championed practical sustainability measures within the workplace and helped embed environmental thinking into everyday operations. This contribution sits comfortably alongside Collins Hume's broader sustainability journey, which was also recognised at the 2025 Ballina Business Excellence Awards. For Naomi, though, it's less about recognition and more about making sure the firm's values are reflected in what happens every day. Leading the business behind the business Naomi's story is also a reminder that great business advice depends on the team behind it. Naomi’s contribution was recognised at the 2025 Ballina Business Excellence Awards, where she was Highly Commended in the Outstanding Employee category, placing among ten finalists. Naomi's recognition came during a memorable evening for Collins Hume, with the firm and several of our team also recognised across business, leadership, sustainability and professional services categories. It was a welcome acknowledgement of the collective contribution of the people behind Collins Hume – and an opportunity to celebrate Naomi's own achievements.

Reviewing your fund’s investment strategy: When to review and what to consider Superannuation law requires trustees of self-managed super funds (SMSFs) to formulate, regularly review and give effect to an investment strategy that considers the whole of the fund’s circumstances. A review should consider if the strategy remains appropriate for the members’ needs, investment risks, cash flow requirements and retirement plans. Trustees must also document the review and any decisions made. How often should you review your SMSF investment strategy? Although the law does not specify a timeframe for “review regularly”, it is commonly accepted that reviews should occur at least annually. This aligns with the ATO’s website, which states that it expects reviews to occur at least annually. Some trustees undertake an annual review leading up to, or at the beginning of, a new financial year. Others review their strategy when reviewing the completed financial accounts from the previous financial year. Neither approach is right or wrong. You need to consider what works best for your situation. What should you document for your fund’s auditor? You need to be able to show your fund’s auditor that you have reviewed the investment strategy and documented your decisions. This includes recording either: Changes you have determined are necessary; or Your decision that the existing strategy remains appropriate. What other events should prompt an investment strategy review? An annual review may not be enough if the fund’s circumstances change. Other appropriate times to review the strategy may include when: There is a market correction; A member joins or leaves the fund; or A member starts a pension in the fund. What should an SMSF investment policy include? An investment policy generally comprises two parts: the investment objective and the investment strategy. Investment objective: What does the fund aim to achieve? The investment objective outlines the fund’s objectives and expected outcomes. For example, it may aim to achieve a certain level of return over a specified period. This would generally take into account the members’ ages, retirement needs and investment risk profiles. Investment strategy: How will the fund achieve its objectives? The investment strategy outlines how the fund will achieve its stated objectives. For example, it may include investment asset ranges or specific assets the fund will hold. What must trustees consider when reviewing the strategy? When reviewing your fund’s investment strategy, consideration must be given to: Investment risk and returns: The risks of holding particular investments and their returns, having regard to the fund’s objectives and expected cashflow requirements. Diversification: The composition of the fund’s investments and the risk of inadequate diversification. Liquidity: The liquidity of investments, having regard to expected cashflow requirements. Liabilities: The fund’s ability to discharge existing and prospective liabilities. Member insurance: Whether the fund should hold insurance cover for one or more members. Although trustees must consider these points, it is up to them to determine how they apply to the circumstances of the fund. Does an SMSF have to hold diversified investments? Trustees must consider diversification, but that does not mean they are required to have a diversified investment strategy. Many funds hold just a property and a bank account, and this may be appropriate for those funds. However, trustees should document: What consideration they gave to diversification; Why the lack of diversification is appropriate; and Why they chose those particular assets. Does an SMSF have to hold insurance for its members? There is no legal requirement to hold insurance cover for members. However, trustees need to document that they have considered it. Why should you review the strategy when a member starts a pension? A member starting a pension is likely to change the fund’s liquidity considerations and investment profile. When all members are in the pre-retirement growth phase, expenses are usually more predictable, and many funds do not need large cash reserves. Once members begin accessing their benefits through pension payments, lump sums or both, cashflow, liquidity and a potential cash buffer become more important considerations. Can your fund meet its minimum pension payments? Leading up to the end of the year, it is not uncommon for us to receive enquiries and concerns from trustees who do not have enough cash to satisfy even the minimum pension requirements for the year. There may be several reasons for this. However, it should raise questions about if the fund’s current investment strategy remains appropriate and whether a review of its asset holdings is warranted. Is a property-based strategy still suitable in retirement? A fund holding one property and one bank account may have had a reasonable strategy during the growth phase. But does that strategy remain appropriate during the drawdown phase? Many people are comfortable with property, and Australian investors generally have an affinity for bricks and mortar. That does not mean property is an appropriate investment in all circumstances. If rental income cannot support your retirement needs and minimum pension withdrawal requirements, something needs to change. The same consideration applies to other investments that may not be easily sold, such as holdings in unlisted companies and trusts. Keep your investment strategy aligned with your retirement needs Reviewing your fund’s investment strategy, members’ needs and asset holdings should be more than a tick-a-box legal requirement. You have worked hard to build your retirement wealth. When the time comes, you want to be able to enjoy it. An appropriate investment strategy that supports this is an important part of running an SMSF. Ready to review your SMSF investment strategy? Contact Collins Hume to arrange a review of your fund’s investment strategy. We can help you assess if it remains appropriate for your members’ needs, cash flow requirements and retirement plans, particularly if a member is starting a pension or your fund is struggling to meet pension payments.

That's a Wrap Folks! And what a grand final it was! Congrats to all the Roosters fans out there, and commiserations to all the Knights faithful. Thank you to everyone for taking part this year. It was a nail-biter that went right down to the wire, making for a memorable finish to the season. Well done to Smellie G coming away with this year's footy tipping win ($300), second place goes to Div ($100), with Fredmurphy taking out third place ($50). This year's Knockout Comp Winner with $100 is Savy78. You'll be hearing from us shortly to arrange your transfer of prize money. Thanks again and hope to see you again for the 2027 season!

Turning business strategy into action Nathan McGrath will join a panel of local experts at Business Lismore’s Business Before Hours event on 13 October 2026, sharing practical perspectives on business strategy. Held during Small Business Month, the session will explore how business owners can set a clear direction, make better decisions and turn their vision and strategy into action. “Having a clear strategy helps business owners focus on what matters, make confident decisions and turn their goals into practical steps. I’m looking forward to sharing insights and discussing the opportunities and challenges facing the Lismore business community,” says Nathan.* Join the conversation Join Lismore Business and Nathan McGrath at Southern Cross University’s Library, L2 Event Space for coffee, a light breakfast and a conversation about building a business that’s heading where you want it to go. Attendees will have the opportunity to ask questions and connect with other local business owners and leaders. Tickets start from $20. Bring your questions and join the discussion. About Nathan McGrath Nathan McGrath is a Senior Business Adviser at Strategy360 by Collins Hume. Supported by senior leadership experience at General Manager and Director level, he brings over 30 years of advisory and management experience across SMEs, corporates and government programs. Nathan works with business owners and leadership teams to clarify objectives and focus on what drives results — improving financial performance, reducing operational and strategic risk, and building sustainable, transferable business value. His advisory approach supports confident, informed decision‑making around growth, performance improvement and business transition. As a contributor to Business Lismore’s Business Before Hours series, Nathan delivers practical insight across the Business Strategy topic. He is known for cutting through complexity to translate strategy and numbers into clear, actionable steps that strengthen profitability and cash flow, de‑risk the business, and support long‑term value growth. Read more about Nathan » Inspiring, Powerful, Meaningful Advice for Your Business

Celebrating Cate’s leadership and creativity Cate McQuillen of mememe productions won Outstanding Business Leader – 20 Employees & Under at the 2026 Northern Rivers Regional Business Awards, held at Ballina RSL Club on Saturday, 26 September. Strategy360 By Collins Hume proudly sponsored the category, and we were delighted to celebrate Cate’s achievement alongside our local business community. The celebrations didn’t stop there: mememe productions also won Excellence in Creative Industries, making it a memorable night for Cate and her team. These achievements highlight the creativity, leadership and talent within the Northern Rivers. At Strategy360 By Collins Hume, we’re proud to support the recognition of local business leaders and their contribution to our region. “Congratulations to Cate and the mememe productions team," said Strategy360 Senior Business Adviser Nathan McGrath. "Cate’s work shows how creativity and a clear sense of purpose can make a lasting difference. Strategy360 By Collins Hume is proud to support this award and celebrate the outstanding business leaders we have here in the Northern Rivers." We also congratulate our Collins Hume clients on their achievements: DR.MOOSE won Excellence in Micro Business, while Chris Photiou, owner of The Trident Fish & Grill, received Highly Commended recognition in the Outstanding Young Business Leader category. A wonderful result for both and a proud moment for our local business community. View the 2026 Northern Rivers Regional Business Awards winners » An Emmy Award-winning creative producer and co-creator of dirtgirlworld, Cate McQuillen combines storytelling with a passion for children’s learning and sustainability. She also created the Get Grubby Program, helping schools and early learning centres bring environmental education into everyday learning. Explore Cate's work at mememe productions »

NSW manufacturing grants: up to $50,000 for technology feasibility projects NSW manufacturers looking to adopt advanced manufacturing technology may be eligible for funding of between $10,000 and $50,000 under Stage 1 of the Innovative Manufacturing Adoption Fund (IMAF). The NSW Government program is designed to help manufacturers investigate new technologies before committing to a larger investment. Applications are now open and close at 5pm on 13 October 2026. Key points Grants range from $10,000 to $50,000 Funding covers 50% of eligible project expenditure Businesses must provide at least a 50% cash co-contribution Stage 1 covers feasibility, pilot and early testing activities Applicants generally need annual turnover of at least $1 million and 10–100 full-time equivalent employees Applications close 6 October 2026 at 5pm. What can the funding be used for? Stage 1 is focused on helping manufacturers determine if adopting new technology is technically feasible and commercially viable. Eligible activities can include: feasibility studies and business case development pilot projects, prototyping and process testing assessment of new equipment, software or systems certification and compliance requirements. At least 75% of the project budget must generally be spent on an external consultant or manufacturing service provider. Up to 25% may be allocated to eligible internal wages. Importantly, Stage 1 does not fund the purchase or lease of machinery and equipment, capital works or general operating expenses. Who may be eligible? Applicants must meet a range of requirements, including being an Australian corporation headquartered in NSW and operating a manufacturing facility in the state. The fund targets manufacturers supplying, or intending to supply, sectors including construction and building products, clean energy products, transport and rolling stock, defence and aerospace, health and medtech, advanced electronics, mining services, agriculture, and food and beverage manufacturing. Considering an application? Applications are competitively assessed, so businesses should first check that they meet the eligibility requirements and that their proposed project aligns with the targeted technologies and sectors. If you are considering applying for the Innovative Manufacturing Adoption Fund, contact Collins Hume to discuss the financial aspects of your project and the 50% co-contribution required before submitting your application.

“Widow tax” fixed Federal Parliament has closed an unintended loophole in the recent negative gearing and capital gains tax reforms that became widely known as the “widow tax”. At the same time, the Government also fixed a technical issue that could have affected people who first use a main residence to generate rental income after Budget night on 12 May 2026. What are the key changes? Property transfers after death or relationship breakdown: New rules protect the existing negative gearing treatment for certain residential property interests transferred from a spouse. Protection may also apply when someone inherits an additional interest from a co-owner who isn’t their spouse. Former homes rented out for the first time: The “first use to produce income” rule is disregarded when determining the acquisition date for negative gearing purposes. Records still matter: Property owners should retain clear records of the original purchase date and ownership history, and have their individual circumstances checked. What was the “widow tax” problem? The tax rules have recently been changed to ensure that losses generated from residential rental properties from 1 July 2027 can be “quarantined”. This means that they can only be offset against income or capital gains generated from other residential rental properties. However, the changes won’t generally apply to properties that were purchased by the relevant taxpayer before 12 May 2026. A problem could arise when an ownership interest in a property passes to someone as a result of the death of the original owner or because of a relationship breakdown, and this occurs after 12 May 2026. Under the original version of the new rules, that transfer could be treated as a new acquisition. This could have meant that a surviving spouse or former partner risked losing the protected negative gearing treatment that had applied to the property in the hands of the previous owner. How was the “widow tax” fixed? The new rules specifically protect people who acquire a residential property interest from a spouse because of death or relationship breakdown. The Government moved quickly once the issue was identified. The rules can also potentially protect someone who inherits an additional ownership interest in a rental property from a co-owner who isn’t their spouse. Case study: Sarah inherits her spouse’s share of a rental property Sarah and David bought a rental unit in 2019 as equal joint owners. The property has always been negatively geared, with annual rental losses of around $8,000 offset against their other income each year. Under the original rules: The property was protected because it was acquired well before Budget night. However, if David had died and the property transferred fully into Sarah’s name, the additional 50% interest that Sarah inherited from David’s estate risked being treated as a new acquisition. Sarah could have lost the ability to claim the losses generated from this interest in the property against her other income. Under the updated rules: That outcome is avoided. Because the transfer occurs due to the death of a spouse, Sarah keeps the original protected treatment and can continue offsetting the rental losses in the same way as before. Will renting out a former home change its acquisition date for negative gearing? The new rules specifically disregard the “first use to produce income” rule when determining the acquisition date for negative gearing purposes. Under the original rules, there was a risk that an existing main residence purchased before 12 May 2026 could lose its protected status if it was later first used to generate taxable rental income after that date. This was because of the interaction with a long-standing tax rule that can treat someone as if they had reacquired a former main residence when it is first used to produce income. The Government has now passed legislation to correct this. Case study: James rents out his former home James bought his home in 2018 and has lived in it as his main residence ever since. In 2027, he decides to move in with his partner and rent the property out for the first time. Under the original rules: First renting the property after 12 May 2026 risked resetting its acquisition date. That could have caused the property to be treated as a post-Budget night acquisition and subjected to the tighter negative gearing limits. Under the updated rules: That reset is disregarded for negative gearing purposes. Because James originally acquired the property before 7:30 pm on 12 May 2026, it keeps its original acquisition date. He can continue to offset any rental losses in the same way as if the property had always been an investment property acquired before Budget night. Why do these negative gearing fixes matter? Both changes remove sources of unexpected cash flow disruption. The “widow tax” fix protects people at a difficult personal time. The main residence clarification gives homeowners greater flexibility if their circumstances change and they later decide to rent out a property they already own. What should property owners do now? If you own a jointly held investment property acquired before 12 May 2026: The “widow tax” fix provides reassurance that a future transfer on death or separation should not remove negative gearing rights. However, the rules are still complex, and it is always best to have the position checked. If you own a main residence bought before 12 May 2026 and are considering renting it out: The new rule means the property should keep its original acquisition date for negative gearing purposes, but there could still be some complex CGT implications. Keep clear records: Retain evidence of the original purchase date and ownership history. If either situation applies to you and you would like confirmation of how the amended rules work in your circumstances, contact Collins Hume on 02 6686 3000.

Who and what is impacted? How does the minimum tax work? The 30% minimum tax will apply to the net income of discretionary trusts from 1 July 2028. From this point forward, where the tax on the relevant net income of the trust falls below 30% in a given income year, the tax payable is ‘topped up’ to 30%. Non-corporate beneficiaries will be entitled to a non-refundable tax offset where the minimum tax has been paid on their share. Any rebates the beneficiary is entitled to cannot reduce the 30% minimum tax. To ensure that franked distributions cannot ‘flow-through’ to beneficiaries, trustees that receive franked dividends will be required to use franking credits when paying the minimum tax. Any excess franking credits can be claimed as a refund. This means the trustee will include the franking credits in its assessable income and claim the franking credits as an offset to reduce its minimum tax. Any excess franking credits will be refunded to the trustee. For example, if the trustee has $1,000 net income, including a $400 franking credit, the trustee’s minimum tax is $300, which can be reduced by offsetting against the $400 franking credit. The excess franking credit of $100 will be refunded to the trustee. If a non-corporate beneficiary is presently entitled to 100% of the trust income, the beneficiary can claim a non-refundable tax offset of $300, being the minimum tax paid by the trustee to reduce their income tax liability. The beneficiary is not entitled to any franking credit attached to the dividend. What trust structures are impacted? Not all discretionary trusts are impacted by the impending rules. The legislation introduces a new concept of a “minimum tax trust”. This is a discretionary trust that is not: a fixed trust a special disability trust the trust estate of a deceased person a complying superannuation entity (including SMSFs) or a trust determined by the Government in the future (by legislative instrument). A series of other types of trusts by their nature are not minimum tax trusts. These include widely held trusts such as MITS and AMITS, CCIVs and CCIV sub-funds, exempt entities such as charitable trusts, bare trusts because they will now fall within the new definition of a fixed trust[i], and employee share trusts and worker entitlement funds. Not all trust income is included Not all income of a minimum tax trust is included in the calculation of net income. The minimum tax will not apply to: taxable primary production income; amounts subject to non-resident withholding tax; And, where certain conditions are met[ii]: a minor’s proportionate share of income of the trust estate; a registered charity’s, DGR’s or exempt entity’s proportionate share of income of the trust estate; income of a testamentary trust. Any trust capital gains included in the net income distribution can also be excluded from the minimum tax where the above exclusions apply. The three options for trustees There are three options for Trustees impacted by the changes: Do nothing and accept a minimum 30% tax rate – if you want to keep the flexibility and the tax is inconsequential; Put in place a one-off election in the 2028-29 income year fixing beneficiaries and their income and capital entitlements – if you distribute to the same beneficiaries; or Utilise the temporary rollover relief provisions and restructure by 30 June 2030 – if the current structure is no longer fit for purpose. 1. The one-off election option The minimum 30% tax will not apply if the trustee elects to nominate the beneficiaries it intends to distribute to. This excluded election trust (EET) nomination sets out: Each beneficiary the trustee intends to make presently entitled to a share of the income and capital of the trust in each year of income. Must be an eligible beneficiary, as defined under the trust deed as at 1 July 2028. Be consistent with any other elections in place, i.e., family trust elections interposed entity elections. A company or another trust can be a beneficiary as long as it existed prior to 1 July 2028, is an object of the trust deed (i.e., no super funds or partnerships), and there are no material discretionary elements affecting the rights or interests of the company’s members. the relevant percentage share for each beneficiary (totalling 100%) of the income and the capital (i.e. cannot allocate 100% of the income to one beneficiary and 100% of the capital to another). No percentage can be retained by the trust. In effect, you specify who/what and how much of the income and capital of the trust the beneficiary is entitled to. Once in place, the election cannot be changed unless a beneficiary dies, there is a family breakdown or the election is revoked. There is no provision for new children or a marriage. The controls on the election are stringent: the election can only be made once and must be in place by 30 June 2029 (notified by the earlier of the due date of the trusts tax return or the lodgement of the return), nominees can only change on a beneficiary's death (share is reallocated to existing beneficiaries or beneficiaries of the deceased estate) or a family breakdown (court order or enforceable agreement), if the trustee distributes inconsistently to the election, it is automatically revoked, and If a company nominated as a beneficiary is wound up, deregistered or the shareholders change (other than death or divorce), the election is automatically revoked. If revoked, either deliberately or by default, the trustee will be taxed at 47% on the net income in the income year in which the election is revoked, with the 30% minimum tax applying in future years. The trustee can choose the election or rollover relief, not both. For example, if the trustee chooses to put an election in place and then decides that the election is not workable, they cannot then access the transitional rollover relief. The only remaining options would be to pay the minimum tax, or the trust vests or is wound up. Before an EET is made, there are some legal issues to consider including whether the trust deed allows the trustee to fix the beneficiaries’ entitlements to income and capital, and the implications of doing so for the trust and its beneficiaries as a whole. 2. Rollover relief for restructuring out of a discretionary trust For some, a discretionary trust will no longer be fit for purpose come 1 July 2028. In these cases, the transitional rollover relief enables trustees to restructure from a discretionary trust into another structure without triggering the income and capital gains tax consequences that would otherwise arise. Assuming the trust deed allows it, the rollover relief applies where both the transferor and transferee have chosen to apply the rollover and: All relevant assets are held and transferred by an entity in its capacity as trustee; the asset is transferred to an eligible transferee such as a company, individual, partnership (with some special rules at partnership level) or another trust that is not a minimum tax trust (no super funds or exempt entities). Continuity must be maintained between the transferor and transferee; there are no material discretionary elements that affect the rights or interests of the members of the transferee; and the transferor and transferee satisfy the residency requirements. Trustees of a minimum tax trust have until 30 June 2030 to complete the rollover. If the conditions are met and the rollover completed within the timeframes, the transfer has no direct consequences under the income tax law, and the transferee generally inherits the transferor’s tax cost and the relevant tax history for the assets. Some assets are excluded and do not have to be rolled out of the trust. These include those not capable of transfer (e.g. carried forward tax losses), a CGT asset used to generate primary production income, and assets used to discharge any liabilities (debts, tax, rights of indemnity or reimbursement for liabilities, and if winding up, any expenses required to cover the cost of the wind-up). The notification for rollover relief is made to the Commissioner each income year where the restructure occurs over more than one income years (prior to the earlier of the due date of the return or the income tax lodgement of the transferee and transferor). The Commissioner is also notified if the transfer is in progress across income years. Next steps While the proposed changes to the taxation of discretionary trusts, including the 30% minimum tax, EET and transitional rollover relief, are in exposure draft form, it’s essential to plan ahead. Identify trusts potentially affected by the new rules, including reviewing the current group entities and structures. Review the trust deeds and seek professional advice, in particular if an EET is being considered. Identify the potential beneficiaries and assess the medium to long-term implications of an EET, including any potential changes to the beneficiaries’ circumstances. Assess an appropriate transferee structure if the restructuring rollover is being considered, having regard to your broader commercial, tax and succession objectives. We will continue to monitor the development of the legislation and provide updates to assist you in making an informed decision. If you need assistance, Collins Hume's tax specialists can assist by clarifying the issues, options and your go forward position. [i] Under the new definition, the trust is a fixed trust where: the trust’s beneficiaries have fixed entitlements to all of the income and capital of the trust; or there are no material discretionary elements affecting the entitlements or rights of the trust’s beneficiaries. Further details are provided in the explanatory materials. [ii] See the explanatory materials for full details on the criteria. The criteria are consistent with existing principles.

If you may sell your business after 1 July 2027, the value established at that date could materially affect how a future capital gain is divided and taxed. Under the new capital gains tax rules, gains accruing before 1 July 2027 will remain under the existing CGT discount regime, if eligible. For affected taxpayers, gains accruing from that date will be subject to cost base indexation and a minimum 30% tax rate, subject to applicable exemptions and concessions. For business owners, this makes 1 July 2027 an important dividing line. Establishing a defensible market value at the transition date can provide a stronger basis for separating the value already created from future capital growth. Leaving that exercise until the business is sold may mean relying on Treasury’s proposed apportionment formula or attempting to reconstruct the business’s former position years later. Why Treasury’s formula may not reflect your business The proposed formula is intended as an alternative to obtaining a formal market valuation for property and assets without a readily ascertainable market value, including interests in private businesses. As currently drafted, it estimates value at the end of 30 June 2027 by assuming the asset grew at a compounded daily rate across the entire ownership period. Important parts of the calculation are also driven by the original acquisition cost rather than necessarily reflecting the owner’s full economic investment. Businesses rarely grow in such a smooth or predictable way. Value may change sharply following: A major contract win or loss The launch of a new product or service An acquisition or restructure Investment in systems, staff or intellectual property Improved profitability or recurring revenue The loss of a key person or customer Changes in the industry or competitive environment A formula calculated at the time of a future sale may allocate growth across the ownership period in a way that does not reflect when the value was actually created. Depending on the circumstances, this could produce a better or worse tax result. The concern is that the formula – not the commercial history of the business – may determine how much growth is attributed to each CGT regime. Establish the 1 July 2027 position while the evidence is current A professional business valuation prepared as at the transition date can capture the factors influencing the business at that time, including: Maintainable earnings and cash flow Customer and supplier concentration Key-person reliance Management capability and business systems Contracts and recurring revenue Intellectual property and goodwill Industry conditions Identifiable risks and growth prospects The valuation does not necessarily need to be commissioned on 1 July 2027. A retrospective valuation may be prepared when the business is eventually sold. However, the longer owners wait, the harder it may become to recreate an accurate picture. Management accounts may be archived or lost. Contracts may expire. Employees may leave. Systems may change. Later success can also make it difficult to separate what was genuinely known or achievable at the transition date from opportunities developed afterwards. Preparing now allows owners to preserve the financial records, forecasts, contracts, board papers, customer information and commercial evidence required to support a future valuation. A stronger basis for future CGT planning Consider a business that experienced substantial growth before 1 July 2027 following years of investment, improved systems and major contract wins. Its performance then stabilises before the owners sell several years later. Treasury’s formula may assume the value grew continuously throughout the entire ownership period. This could attribute some of the earlier commercial growth to the post-2027 period, even though the value had already been created by the transition date. A defensible market valuation can provide evidence of the business’s actual position at that date. This does not guarantee a lower tax bill. In some circumstances, Treasury’s formula may produce the more favourable result. Establishing the transition-date value gives owners and their advisers a stronger basis for comparing the available outcomes instead of discovering the issue only after a buyer appears, or a decision to transition ownership emerges. It may also support earlier decisions about: The timing and structure of a future sale Succession or ownership changes Eligibility for small business CGT concessions Business improvements that could increase future value The records needed to support the eventual tax position Prepare now (not when the sale is underway) A future business sale or transition of ownership is likely to involve due diligence, negotiations and significant commercial decisions. Reconstructing the business’s value as at 1 July 2027 should not become another urgent task during that process. Establish your 1 July 2027 asset cost base while the evidence is current The CGT reforms are coming. If you leave your business valuation until a future sale, important financial and commercial evidence may be difficult to reconstruct, and Treasury’s proposed apportionment formula may not reflect when your business created its value. Strategy360’s Business Position Assessment provides a structured, cost-effective way to document your business’s financial performance, risks and value drivers, supporting a defensible valuation position for future CGT purposes. Whether you are a Collins Hume client or not, our Business Valuation Specialists can help you prepare for the transition date, establish your business value and preserve the evidence needed to support future CGT planning. We also work with accountants, advisers and property valuers who require specialist business valuation expertise for their clients. Talk with Strategy360 about preparing your 1 July 2027 asset cost base now. View our factsheet Important: The first stage of the CGT reforms has become law, but the detailed apportionment method discussed above remains in exposure draft at the date of publication and may change. This article provides general information only. Obtain professional tax and valuation advice for your circumstances. Further reading Australian Treasury, Capital Gains Tax and Negative Gearing – Tranche 2 Legislation Australian Financial Review (19 August 2026), Inside Treasury’s nine-step CGT formula: are you set to win or lose?