Support Query

How do I record AMIT Cost Base Adjustments from Annual Tax Statements in Simple Fund 360?

AMIT Overview

What is the AMIT cost base net amount (AMMA statement)

Trustees of AMITs are required to state their reasonable estimate of this amount on the AMMA statement for the income year.

The AMIT will calculate an AMIT cost base net amount for the income year in relation to your units or interests in the AMIT and must state it in your AMMA statement. You will then need to apply the AMIT cost base net amount to adjust the cost base and reduced cost base of your units or interests in the AMIT. The AMIT cost base net amount broadly represents any difference between amounts that are included in your assessable income (or NANE income) for the AMIT and actual distributions you receive from the AMIT.

The previous taxation regime provided for decreasing but not increasing cost base adjustments. Decreasing cost base adjustments are typically required when a Unitholder's share of the trusts taxable income is less than the distribution paid by the trust (commonly referred to as Tax Deferred Income). The new AMIT regime will retain this decreasing cost base adjustment requirement.

Where do I enter Attribution Managed Investment Trust ('AMIT') Cost Base Adjustments on More Details panel 

When would an AMIT cost base adjustment occur?

1. An upwards cost base adjustment is made to the AMIT member's cost base when an attributable amount is allocated to the member. This amount is included in the member's assessable income (negative tax deferred).
2. A downwards cost base adjustment is required when a distribution is made to the AMIT member (positive tax deferred).

This can give rise to the situation where the allocated amount is different to the distributed. In this case a cost base adjustment would be required.

For more information on cost base-adjustments in the scenario of AMIT member's, please see the following ATO article: Cost base-adjustments for AMIT members.

AMIT cost-base adjustments and Distribution Statements

AMIT cost-base adjustments can appear one of two ways in AMIT Distribution Statements:

1. As an AMIT cost-base adjustment;
2. As a Tax-deferred amount, either positive or negative where:
   1. Positive Tax Deferred = A downwards AMIT cost-base adjustment;
   2. Negative Tax Deferred = An upwards AMIT cost-base adjustment.

AMIT cost-base adjustments defer the cash effect for an AMIT member's distribution to the time when their interest in the AMIT is realised.

AMIT cost base net amount - decrease (or cost base net amount - excess)

The investor must reduce the cost base and reduced cost base of their membership interests in the AMIT by the AMIT cost base net amount - excess. Once your cost base is reduced to nil, any remaining AMIT cost base net amount will trigger CGT event E10 and you will have a capital gain equal to the excess amount.

AMIT Summary provided by the ATO:

Scenario 1

In this example, the AMIT cost base net amount has been provided within the AMMA Statement.

Record in Simple Fund 360

Distributions are recorded from the Transaction List or through the Transaction Matching Screen. Select the income account 23800/INVESTCODE, this will prompt Simple Fund 360 to display the More Details Panel to enter the Distribution Details. This example only refers to the inputting of the Tax Statement amounts received at year end and assumes a $0 journal is being recorded.

1. From the Transaction List screen, select New Transaction. From the drop down list, select Journal.
2. Input the date of the transaction.
3. Under the Account heading, select the 61800/INVESTCODE account from the Select an account box. Click on the next Select an account box. Begin typing and select account 23800/INVESTCODE.
4. Input $0 in the DR and CR fields. Select More + next to the 23800 line item.
5. Within the More Details Panel record the Gross Interest and Other Income:
   
   

6. Record the AMIT net amount within the AMIT section:
   
   

   What if the AMIT amount received was a Cost Base Net Increase Amount?

   Record this amount into the AMIT Cost Base Net Increase Amount / Shortfall section as a positive amount.

7. Select Post. 

Scenario 2

Bob received his AMIT Member Annual Statement and Guide for the year ended 30 June 2017. The guide contained the following information:

Record in Simple Fund 360

Distributions are recorded from the Transaction List or through the Transaction Matching Screen. Select the income account 23800/INVESTCODE, this will prompt Simple Fund 360 to display the More Details Panel to enter the Distribution Details. This example only refers to the inputting of the Tax Statement amounts received at year end and assumes a $0 journal is being recorded.

1. From the Transaction List screen, select New Transaction. From the drop down list, select Journal.
2. Input the date of the transaction.
3. Under the Account heading, select the 61800/INVESTCODE account from the Select an account box. Click on the next Select an account box. Begin typing and select account 23800/INVESTCODE.
4. Input $0 in the DR and CR fields. Select More + next to the 23800 line item.
5. Within the More Details Panel record the Gross Interest and Other Income:
   
   
6. Record the Distributed Capital Gains:
   
   
7. Record the Foreign Source Income:
   
   
8. Record the Non-Assessable Amounts:
   
   

9. Record the AMIT net amount within the AMIT section:
   
   

   What if the AMIT amount received was a Cost Base Net Decrease Amount?

   Record this amount into the AMIT Cost Base Net Decrease Amount / Excess section as a positive amount.

10. Select Post. 

See Also

• How to Enter a Distribution & Tax Statement