Trust tax escape hatch removes flexibility small businesses need, lobby warns

The government lets nearly 250,000 small businesses avoid a trust tax with an at least 30 per cent floor. The catch: they must lock in beneficiary splits permanently.

Why it mattersSmall business owners would face higher taxes and lose planning flexibility. That flexibility helped them manage cash. It also helped them adapt to family changes.

AustraliaNearly 250,000 Australian small businesses structured as trusts face tighter tax rules and reduced ability to distribute income strategically.

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