From www.accountantsdaily.com.au: The ATO has warned trustees of family trusts about the rising risk of family trust distribution tax due to inadequate record-keeping and succession planning.

To mitigate tax liabilities, trustees should review their family trust elections and be aware of who is considered part of their family group before making distributions.

Strong governance and annual reviews of election statuses are required to avoid the application of a 47% tax on distributions made outside the defined family group.