Newcastle Accountants | Maitland Accountants | Bottrell Offices located in Newcastle, Maitland. Your local Accountants, Tax Agents & Advisors in Newcastle & Maitland.

Deceased Estate Tax Return

Accountant

When a loved one passes away, it can be emotionally stressful. In addition to dealing with the emotional aspects of grief, there are also important financial and legal matters to consider. One of these is the deceased estate tax return, which must be filed with the Australian Taxation Office (ATO).

Bottrell Accountants & Tax is a leading provider of tax services for individuals and businesses in the Maitland region. Our office is located at 93 Lawes St, East Maitland, NSW 2323, and we are open Monday to Friday, with Saturday meetings available by appointment.

Founded in April 2010 in the Maitland CBD, our team of experienced tax accountants is dedicated to helping our clients navigate the complex world of tax laws and regulations. One of our specialties is deceased estate tax returns, an area where many people need expert guidance.

Obtaining advice on deceased estate tax returns is vital to ensuring that the process is handled correctly and efficiently. Not only can a qualified tax accountant help ensure that all the necessary information is included and all deadlines are met, but they can also provide guidance on tax-saving strategies that can help reduce the overall tax burden on the estate.

In addition to deceased estate tax returns, Bottrell Accountants & Tax also provides expert advice on a wide range of other tax-related matters, including income tax, foreign tax, and capital gains. Our team of experienced tax professionals can help you navigate the complexities of these areas, providing you with the guidance and support you need to make informed decisions about your financial future.

What a deceased tax return is for:

Trust tax returns are used to report the income of a deceased estate after the person’s death, such as rental income or share dividends and claim any tax refund or franking credits owed to the estate. If a return needs to be lodged, the estate is treated as a trust for tax purposes. Trust tax returns may need to be lodged yearly until the estate is finalised. This is different from the date of death tax return, which is for the period before the person died, and tax returns for a testamentary trust, which is a separate trust created under the terms of a will and continues after the deceased estate is finalised. Finalising a deceased estate typically takes 6 to 12 months but can take longer.

When can you lodge a trust tax return?

A trust tax return can be lodged once the death of a person is notified and the person managing their tax affairs is entered into the records.

When a trust tax return is required

A trust tax return must be lodged for the first 3 income years of a deceased estate if any of the following conditions apply in that year:

  • if the deceased estate’s net income is more than the tax-free threshold for individuals,
  • a beneficiary is presently entitled to any of the estate’s income at the end of the income year,
  • a beneficiary of the estate is not an Australian tax resident.
  • For income year 4 and later income years, a trust tax return must be lodged if the deceased estate earns any income (including capital gains).
  • Even if it is not required, a trust tax return can be lodged to claim franking credits on dividends paid to the estate. The first income year of a deceased estate starts the day after the person died and ends on the next 30 June.

Getting a TFN and ABN for a deceased estate

A trust tax file number (TFN) is required for lodging a trust tax return for the estate. In case the deceased estate is running a business, an Australian business number (ABN) will also be necessary.

Lodging a Trust Tax Return

  • You can lodge a trust tax return for the deceased estate using the paper form Trust tax return.
  • If you are the authorized legal personal representative (LPR) of the deceased estate and have appointed a tax agent to help you, the agent can prepare and lodge the return online.

Income to Include in a Trust Tax Return

  • You need to include all income the deceased estate has earned since the date of death, including:
    • Capital gains on the sale or transfer of assets, if this was not done as part of the will or the rules of succession
    • Super lump sums or employment termination payments.

Capital Gains

  • If an asset passes to a beneficiary of the estate (for example, under the will or rules of succession):
    • You do not include the capital gain or loss in the trust tax return
    • If the beneficiary is a foreign resident, charity or super fund, you report the capital gain or loss in the deceased’s date of death tax return.
  • If you transfer or sell an asset of the estate for any other reason, you need to include any capital gain or loss in the trust tax return. This applies even if the transfer or sale is to a person who is a beneficiary.

Employment Termination Payments

  • The deceased person’s employer may pay their estate a death benefit employment termination payment (ETP).
  • You will receive a PAYG payment summary – employment termination payment. It will show the tax-free and taxable components.
  • The ETP is taxed as if it was made directly to the beneficiaries, except that the Medicare levy does not apply.

Note: If the deceased had any unapplied net capital losses when they died, these could not be used to offset against any net capital gains of the deceased estate.

Our Personal Tax Services include:-

  • Personal Tax Return preparation & lodgement
  • Rental Property Tax Returns
  • Investment Tax Returns
  • Deceased Estate Tax Returns
  • Cryptocurrency Tax Returns

East Maitland Accountant

Contact us at @ Maitland Accountants

  • Physical Address – 93 Lawes St, East Maitland NSW 2323.
  • P: 02 40275782
  • E: office@bottrellaccounting.com.au

Our Maitland Personal Tax appointments are:-

  • In Person
  • Online (Zoom/Teams)
  • Mobile Tax Services
  • Onsite Services

 

Socials & Links for the Maitland Office

Facebook – Bottrell Accounting Facebook Page

Instagram – Bottrell Accounting Instagram

East Maitland Office Google  – Bottrell Google

Linkedin Profile

Service Pages for Maitland Accountants, Tax Agents & Financial Planners