trust cannot distribute loss to beneficiaries - but the loss here means accounting loss or tax loss

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(Initiate)Registered Tax Professional

21 Dec 2022

I understand a tax loss of a trust can not be distributed to beneficiaries. They are carried forward and used to reduce the trust's net income in a later year, subject to certain tests. These tests are contained in the trust loss provisions in Schedule 2F to the Income Tax Assessment Act 1936 (ITAA 1936).

How about in trust profit and loss statement, when there is accounting loss, can the accounting loss be distributed to beneficiaries in P&L? Should we purely look at tax loss, instead of accounting loss in a trust situation?

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