Managed Investment Trusts

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Presentation Description

Under Australian law, an investor could make an investment directly or through an investment vehicle including a company, a trust, a joint venture, a managed investment scheme or a partnership.

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Presentation Transcript

Managed Investment Trusts:

Managed Investment Trusts

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INVESTMENTS INTO AUSTRALIA CAN BE MADE THROUGH A VARIETY OF DIFFERENT STRUCTURES, EACH OF WHICH HAVE DIFFERENT CONSEQUENCES FOR TAX PURPOSES.

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Under Australian law, an investor could make an investment directly or through an investment vehicle including a company, a trust, a joint venture, a managed investment scheme or a partnership. The appropriateness of any one of these methods is dependent on the desired commercial requirements of a transaction and the taxation implications that result from each structure.

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A increasingly popular investment vehicle for foreign investors into Australia is the managed investment trust. The key benefit of a managed investment trust (“MIT”) is to access the concessional withholding tax regime. Under the MIT withholding tax regime, foreign investors who are a resident of a country with which Australia has an effective exchange of information on taxation matters are eligible for a reduced rate of withholding tax on fund payments from a MIT. The rate of withholding tax depends on the residence of the investor.

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There are two critical eligibility requirements to access the managed investment trust regime: Ownership requirement — the trust must satisfy a widely held ownership requirement and must also not be closely held under the applicable tests Investment management requirement — a ‘substantial proportion’ of the ‘investment management activities’ must be carried out in Australia SMSF Advisory members are considered the leading provider of trustee, custody and investment manager services to MITs in Australia. We are able to assist with both establishing and maintaining MITs.

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SMSF Adisory’s Australian Financial Services Licensees are authorised to act as Trustee and investment manager to MITs. The role of the Trustee includes: Responsibility for the compliance and the governance of the MIT Ongoing satisfaction of legislative and regulatory requirements for the MIT Overseeing the operations and administration of the MIT Holding title to the MIT’s assets Operating the MIT’s bank accounts

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For more update , visit us https://www.smsfadvisory.com

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