A trust tax return is the annual return a trustee lodges for a trust. It reports the trust’s income and deductions, works out its net income, and shows which beneficiaries are entitled to that income and how much. In most cases the trust itself pays no tax, because each beneficiary pays tax on their share at their own rate.
The trustee has to lodge regardless of the amount of net income, unless the ATO has said a return isn’t needed. If you lodge the 2026 return yourself, it is due by 31 October 2026. Through a registered tax agent, most trusts get until 31 March or 15 May 2027, depending on size and lodgment history.
This guide covers who lodges, the due dates, trustee resolutions, the TFN reporting change that started on 1 July 2026, and a worked example showing how distribution decisions change the total tax bill.
Key takeaways
- The trustee lodges the trust tax return every year, even if the trust made little or no income.
- Self-lodged 2026 trust returns are due 31 October 2026. Tax agent clients usually have until 31 March or 15 May 2027.
- Trustee resolutions must be made by 30 June (or an earlier date in the deed). Capital gains entitlements can be recorded up to 31 August.
- From 1 July 2026, closely held trusts report beneficiary TFNs in the statement of distribution instead of sending quarterly TFN reports.
- If no beneficiary is presently entitled, the trustee can be taxed at 47% (45% under section 99A plus the 2% Medicare levy).
Trust tax return at a glance
| Item | 2026 trust tax return (2025-26 income year) |
|---|---|
| Form | Trust tax return 2026 (NAT 0660) |
| Who lodges | The trustee, regardless of the amount of net income |
| Self-lodged due date | 31 October 2026 |
| Through a registered tax agent | 31 March 2027 if the latest return showed tax of $20,000 or more, otherwise 15 May 2027 for most trusts (large and medium trusts have earlier dates) |
| Trustee resolutions | By 30 June 2026, or earlier if the deed says so |
| Capital gains streaming | Specific entitlement recorded by 31 August 2026 |
| Final quarterly TFN report | April to June 2026 quarter, due 31 July 2026 |
| No beneficiary presently entitled | Trustee assessed under section 99A at 45%, plus 2% Medicare levy (47% in total) |
| Minor beneficiaries (2025-26) | Nil to $416, then 66% of the excess up to $1,307, then 45% of the whole amount |
Who has to lodge a trust tax return?
The trustee is responsible for the trust’s tax affairs. That means registering the trust, getting a tax file number for it, lodging the trust tax return each year and paying any tax the trustee is liable for. A trust carrying on an enterprise can also get an ABN.
This applies to the common trust types we see, including discretionary family trusts, unit trusts and hybrid trusts. A deceased estate can also need its own trust tax return.
- The trust lodges a return even if net income is nil or a loss, unless the ATO tells the trustee in writing that one isn’t required.
- Beneficiaries report their share of net income in their own returns, so the trust and beneficiary returns need to match.
- Closely held trusts with trustee beneficiaries may also need to report trustee beneficiary details.
When is the trust tax return due?
The due date depends on whether you lodge yourself or through a registered tax agent. For the 2026 trust tax return (income year ended 30 June 2026), these are the ATO lodgment program dates:
| Situation | Due date |
|---|---|
| Lodging yourself | 31 October 2026 |
| Tax agent client with one or more prior-year returns outstanding at 30 June 2026 | 31 October 2026 |
| Large or medium trust (income over $10 million), taxable in latest year lodged | 31 January 2027 |
| Large or medium trust, non-taxable in latest year lodged, or new large or medium registrant | 28 February 2027 |
| Latest return showed tax of $20,000 or more | 31 March 2027 |
| All other trusts on a tax agent list, including new registrations | 15 May 2027 |
Returns due 15 May 2027 can be lodged by 5 June 2027 without penalty, as long as any payment is also made by then.
Tip
Lodge early if you can. From 2026, the ATO uses statement of distribution data from trust returns to pre-fill beneficiaries’ individual returns, which helps beneficiaries who use a different agent or myTax.
What has to be done by 30 June?
Most of the tax outcome is locked in before the return is prepared. Under the ATO’s trustee resolutions guidance, a resolution only decides who is taxed on the trust’s net income if it is made by the end of the income year, which is 30 June unless the deed sets an earlier date.
- Read the deed first. Some deeds require resolutions earlier than 30 June or in writing.
- Make sure each beneficiary is actually a beneficiary under the deed.
- Franked dividend entitlements must be recorded by 30 June. Specific entitlement to capital gains can be recorded up to 31 August.
- A resolution doesn’t need a dollar figure, but it must set a clear method for working out each share.
- If a family trust election is in place, distributions outside the family group can trigger family trust distribution tax.
Watch out
If no beneficiary, including a default beneficiary, is presently entitled by 30 June, the trustee is assessed on the net income. Under section 99A that is at a flat 45%, and the Medicare levy of 2% also applies, so 47% in total. Distributions where the money really ends up with someone else can also be caught by section 100A.
What changed for TFN reporting from 1 July 2026?
Closely held trusts used to send quarterly TFN reports listing beneficiaries’ TFNs. That requirement has now been removed for distributions from 1 July 2026.
- The last quarterly report covered April to June 2026 and was due 31 July 2026.
- Trustees now report beneficiary TFNs in the statement of distribution on the trust tax return.
- If a beneficiary hasn’t quoted a TFN before a distribution is paid, TFN withholding at the top rate still applies.
- The ATO says extra labels for beneficiaries without a TFN will be added to the trust return from 2027.
- The 2026 statement of distribution also has three new labels (B1, U2 and H1) for managed investment scheme, franked investment and foreign financial investment amounts, which feed into each beneficiary’s net financial investment loss.
How are trust distributions taxed?
Adult resident beneficiaries add their share of the trust’s net income to their other income and pay tax at their marginal rate. For 2025-26, the resident tax rates are nil to $18,200, 16% to $45,000, 30% to $135,000, 37% to $190,000 and 45% above that, plus the 2% Medicare levy. You can estimate a beneficiary’s tax with our income tax calculator.
Minors are different. For 2025-26, a resident under 18 pays nil on trust income up to $416, 66% of the excess between $417 and $1,307, and 45% of the whole amount once it passes $1,307. A $2,000 distribution to a 15-year-old with no other income is taxed at 45% of $2,000, which is $900.
Worked example: does the distribution choice matter?
Here is how the same trust income can produce very different tax bills. All figures use 2025-26 resident rates, include the 2% Medicare levy and are before tax offsets such as the low income tax offset.
The facts
- The Patel Family Trust (a made-up example) has net income of $120,000 for 2025-26.
- The beneficiaries are two adults, Priya and Raj. Both are Australian residents with no other income.
- The trustee is choosing how to resolve the income before 30 June 2026.
Option 1: all income to Priya
- Tax on $120,000: $4,288 + 30% x ($120,000 – $45,000) = $4,288 + $22,500 = $26,788
- Medicare levy: 2% x $120,000 = $2,400
- Total: $29,188
Option 2: $60,000 each to Priya and Raj
- Tax on $60,000: $4,288 + 30% x ($60,000 – $45,000) = $4,288 + $4,500 = $8,788
- Medicare levy: 2% x $60,000 = $1,200
- Each beneficiary: $8,788 + $1,200 = $9,988
- Total for both: $19,976, which is $9,212 less than Option 1
What if no valid resolution is made?
If the resolution is missed and the deed has no default beneficiary, the trustee could be assessed under section 99A at 45% plus the 2% Medicare levy: 47% x $120,000 = $56,400. That is $36,424 more than Option 2.
Splitting income only works where the beneficiary genuinely benefits. If Raj’s $60,000 is paid back to Priya under an arrangement, section 100A can apply and the trustee may be taxed instead. Our article on the Bendel case and unpaid trust entitlements covers a related issue for corporate beneficiaries.
What trust changes are coming?
Trust taxation is changing over the next few years, so it pays to check your structure. Here is where things stand as of October 2026:
- CGT discount (law): the Treasury Laws Amendment (Tax Reform No. 1) Act 2026 replaces the 50% CGT discount with cost base indexation for individuals and trusts for most CGT events from 1 July 2027. Gains accrued before then keep the discount.
- Minimum tax on discretionary trusts (proposed): a 30% minimum tax at the trustee level from 1 July 2028, with non-refundable credits for non-corporate beneficiaries. This is not yet law.
If you’re weighing up whether a trust still suits you, see our comparison of a trust vs company and our guide to the trust deed. If you also run a partnership, the partnership tax return works in a similar way.
Frequently asked questions
When is a trust tax return due?
If you lodge the 2026 trust tax return yourself, it is due by 31 October 2026. If the trust uses a registered tax agent, most trusts have until 31 March 2027 (where the latest return showed tax of $20,000 or more) or 15 May 2027. Large and medium trusts and trusts with overdue returns have earlier dates.
Does a trust pay tax?
Usually not. Beneficiaries who are presently entitled to the trust income pay tax on their share at their own rates. The trustee pays tax when no beneficiary is presently entitled (at 45% under section 99A plus the 2% Medicare levy) or on behalf of certain beneficiaries, such as minors and non-residents.
Do I need to lodge a trust tax return if the trust had no income?
Yes. The trustee must lodge a trust tax return regardless of the amount of net income, unless the ATO has advised that a return is not required.
What happens if the trustee resolution is made after 30 June?
A resolution made after 30 June (or after the earlier date in the deed) does not decide who is taxed on the trust net income. Default beneficiaries, if any, are taxed instead, and if there are none the trustee can be assessed at 45% plus the 2% Medicare levy.
Do trusts still lodge quarterly TFN reports?
No, not for distributions from 1 July 2026. The final quarterly TFN report, for April to June 2026, was due 31 July 2026. Closely held trusts now report beneficiary TFNs in the statement of distribution on the trust tax return.
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Talk to a registered tax agent
Need your trust tax return lodged, or want a second opinion on this year’s distributions before the deadline? Call Nanak Accountants on 1300 626 258, or book a consultation with our team. We prepare trust returns and resolutions through our trust accounting service.
This article is general information only and is not personal financial or tax advice. Information checked against ATO and Federal Register of Legislation sources on 23 October 2026.
