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Published 16 October 2026
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A family trust behind your business now comes with a decision and a deadline.
Treasurer Jim Chalmers introduced a bill on 14 October 2026 for a minimum tax on discretionary trusts. The tax would start on 1 July 2028 (Treasury, 14 October 2026).
ABC News reports the minimum rate as 30 per cent, if the bill passes (ABC News, 15 October 2026).
A founder running a salon, a clinic, a studio or a consultancy may have set up a family trust on an accountant's advice years ago, and may not have read the trust deed since. This bill is the reason to read the deed again.
Who the new trust tax reaches
A discretionary trust lets the trustee choose, each year, which family members receive the income and how much each one gets. Spreading income that way can lower the tax a family pays overall. The minimum tax is aimed at that spreading.
Trusts in Australia, by the numbers
Treasury says "more than 90 per cent of small businesses will not be affected by these changes in any given year" (Treasury, 14 October 2026). That figure counts every small business, including the ones with no trust at all. A founder who runs her business through a discretionary trust needs to check whether the trust falls outside that 90 per cent.
The two dates that matter
The tax would start on 1 July 2028. The earlier date is the one to plan around.
The dates to plan around
14 October 2026
Bill introduced
Treasury
1 July 2027
Rollover relief opens for a restructure
1 July 2028
Minimum tax would start
If the bill passes
From 1 July 2027, small businesses using a discretionary trust can get rollover relief if they choose to restructure, according to Treasury. Rollover relief eases the tax cost of moving the business into a different structure. State or territory stamp duty can still apply to a restructure.
Treasury also describes a second path. A trust can make an election to be exempt from the minimum tax, for as long as the trust keeps paying income to beneficiaries named in an upfront nomination. Treasury says that path needs no restructure and is not expected to attract state or territory stamp duty.
So a founder has three broad choices: keep the trust unchanged and pay the minimum tax where the tax applies, restructure with rollover relief, or nominate beneficiaries up front and elect out.
Three broad choices
01
Keep the trust
Pay the minimum tax where the tax applies.
02
Restructure
Use rollover relief from 1 July 2027. Stamp duty can still apply.
03
Elect out
Name beneficiaries up front. No restructure needed.
The right choice depends on who receives the income today, and only an accountant who knows the trust can weigh the three choices.
Why the advice bill is the hidden cost
Jocelyn Martin, managing director of the Housing Industry Association, called the changes a "kick in the gut" for tradies. Martin said businesses may spend "anywhere between $10,000 and $25,000" on advice to learn whether the changes affect them (ABC News, 15 October 2026).
Martin also said trusts help with cash flow and with paying owners in lean months. For a service business with uneven bookings, that use matters as much as the tax.
Not everyone agrees the trust rules needed protecting. Dale Boccabella, an associate professor at UNSW Business School, said some uses of trusts to cut tax are "bordering on a joke". Cassandra Goldie, chief executive of the Australian Council of Social Service, welcomed the change (ABC News, 15 October 2026).
"This reform helps fix this severe unfairness in the system"
The bill still has to pass. The quickest way to keep the advice bill small is to walk into the accountant's office with the facts already written down.
What to gather before the accountant meeting
An accountant charges for time. Every question the accountant has to chase is time on your bill. Five things answer most of those questions:
Then ask three questions. Does the minimum tax apply to the trust as the trust runs today? Would electing out with a fixed list of beneficiaries suit the family? Is restructuring with rollover relief from 1 July 2027 worth the cost?
Where an AI dashboard helps
A plug and play AI dashboard, with the AI you already use, can hold the trust record on one page: the beneficiary list, each year's payments, the two dates, and every answer the accountant gives. ChatGPT, Claude, Gemini or Copilot can then read that page and draft the meeting brief, the follow-up email and the reminder ahead of 1 July 2027. The decision stays with you and your accountant. The record stops living in an inbox.
A founder who gathers the facts this quarter pays for one clear meeting. A founder who waits pays for the same work in a rush before the minimum tax starts on 1 July 2028.
This article is general information, not tax, legal or financial advice. Your accountant can apply the minimum tax on discretionary trusts to your own trust and your own business.