Publish Date: October 25, 2026
The proposed EET (Eligible Entity Trust) election framework and 30% minimum tax regime could significantly change how Australian family trusts are used for business ownership, investments, income distributions and long-term tax planning.
Under the proposed reforms scheduled to commence on 1 July 2028, qualifying existing discretionary trusts may have an opportunity to elect EET status as an alternative to the proposed 30% minimum tax regime. However, the election could introduce restrictions and ongoing compliance obligations that need to be considered carefully.
For business owners and property investors, the choice between operating through a discretionary trust, company or an EET structure could have significant long-term tax consequences.
For example, a family trust that distributes income to adult beneficiaries on lower marginal tax rates may face different outcomes from a trust that distributes profits to a bucket company, holds investment properties or operates an active business.
The proposed changes could also influence future decisions about business structures, asset ownership, capital gains, succession planning and whether an existing trust structure remains appropriate.
An EET election should not automatically be considered the better option. Trustees should compare the potential tax outcomes, distribution flexibility, ongoing compliance costs and long-term consequences before making a decision.
As the reforms remain subject to final legislation, the eligibility requirements, election deadlines and precise tax consequences should be confirmed before restructuring an existing trust or making an election.
Read our complete guide to EET elections and discretionary trust tax reforms to understand how the proposed changes may affect family trusts, companies and business ownership structures.
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