Thursday, December 21, 2017
The Australian Government is consulting on a proposed new tax framework for Corporate Collective Investment Vehicles (CCIVs).
The Australian funds market currently uses unit trusts, whereas corporate and limited partnership investment vehicles are more common elsewhere in the world. The Government is implementing a new CCIV, with the aim of offering an internationally recognizable investment vehicle that can be readily marketed to foreign investors. CCIVs will operate with a corporate structure, as opposed to a trust-based structure.
Revenue Minister Kelly O'Dwyer said: "CCIVs will increase the competitiveness of Australia's managed funds industry by aligning Australia's legal funds structures with those found in the rest of the world."
The proposed tax system for the new CCIV has been designed to broadly align with the attribution tax regime for managed investment trusts (MITs). One of the key features of the CCIV regime will be a capital gains tax (CGT) relief for attribution MITs that convert into CCIVs and meet the eligibility requirements for attribution tax.
O'Dwyer said: "This capital gains tax relief will ensure investors' balances are not reduced by tax at the time the attribution MIT moves into the CCIV regime."
There will be further consultations on the regulatory aspects of the CCIV framework in the early part of 2018. The Government will also consult on technical amendments to the tax system for MITs, to ensure that it continues to operate as intended.