You must decide how to distribute your Family Trust’s income before 30 June each year. Documenting this decision after the fact is not just poor practice. It is a crime. The Australian Taxation Office (ATO) now actively looks for backdated documents. It has the resources to find them.
The Trustee for Goldenville Family Trust and Commissioner of Taxation (2025)
Consider the case of The Trustee for Goldenville Family Trust and Commissioner of Taxation [2025] ARTA 1355, in which the Administrative Review Tribunal found distribution resolutions to be invalid. Why? There was no evidence that the trustee made the decisions before the end of the financial year. The documents said ’30 June’.
However, the evidence, including the digital metadata on the electronic signatures, indicated that the documents were prepared months after the alleged incident. This is a simple but fatal error that the ATO’s digital forensic teams easily uncover.
The result? The default beneficiaries, all Australian residents, paid tax on the income at higher rates. The attempt to distribute to a non-resident beneficiary to pay a lower tax rate failed. The tax outcome was costly and unexpected.
Your Family Trust Distribution Decision must be made before 30 June
Backdating any document is illegal. Authorities such as the Family Court, Bankruptcy Court, and the Australian Taxation Office (ATO) have methods to verify a document’s validity. For your peace of mind, ensure your Family Trust minutes are prepared and signed well before the 30 June deadline.
For a trust distribution minute to be effective for tax, trustees must decide how to allocate income by 30 June. Your trust deed may even require an earlier date.
It is acceptable to prepare the formal paperwork after 30 June. But these documents must reflect a genuine decision made before the deadline. For example, the directors of a corporate trustee meet on 29 June. They make formal decisions. Someone takes handwritten notes. The minutes are built on Legal Consolidated’s website and signed on 5 July. The ATO usually accepts this. But do not rely on this. Build and sign the Trust Minutes well before 30 June and email a copy to your accountant before 30 June.
If the ATO finds your decision was made after 30 June, the resolution is invalid. A default beneficiary may then be taxed. Or the trustee is taxed at penalty rates. This creates an expensive tax problem. It also creates legal issues over who is entitled to the money.
Evidence of when the Trust Minute is signed is everything
The lesson from Goldenville is clear. Documentation is not an afterthought. A lack of contemporaneous evidence changes the tax outcome. What matters is when you make the decision. Not when you write the paperwork.
In practice, this means:
- Check your deadlines. Know what needs to happen and when: well before 30 June is best practice.
- Follow a formal process. Build and sign the Legal Consolidated Trust Minute.
- Produce evidence. Create a time-stamped record. An email to your accountant confirming the decision is excellent evidence.
Thinking about timing and creating clear evidence is crucial. It is the difference between your tax planning working and an expensive dispute with the ATO.
Backdating is a Criminal Offence
Backdating any document, such as a Partnership Deed or Minute, is illegal.
Section 137.1 of the Criminal Code Act 1995 (Cth) makes it an offence to knowingly provide false or misleading information to a Commonwealth entity or to a person exercising powers under a Commonwealth law. The maximum penalty for this offence is 12 months’ imprisonment.
However, the prosecution must prove that the accused gave information to a Commonwealth entity, that they knew it was false or misleading, and that they omitted any necessary information without which it would be misleading.
Build Your Trust Minutes Correctly
Do not risk your family’s assets. A properly prepared Distribution Minute is your protection. It provides clear evidence of your decisions. It ensures you comply with Australian law. It protects you from ATO scrutiny.
You can build your Family Trust – Annual Distribution Minute on our website. It is designed by lawyers to be compliant and legally robust. It helps you document your decisions correctly and on time. Protect your Family Trust. Protect your family.