Division 7A – Bendel, UPEs and the Future of Trust Distributions
Overview
An overview of the current state of play with Division 7A including latest ATO guidance and case law on unpaid present entitlements
The Division 7A landscape has changed dramatically following the High Court’s landmark decision in Commissioner of Taxation v Bendel. In a major defeat for the ATO, the High Court confirmed that an unpaid present entitlement (UPE) owed by a trust to a corporate beneficiary is not, of itself, a “loan” for Division 7A purposes, overturning more than 15 years of ATO administrative practice and guidance.
But while Bendel represents a significant taxpayer victory, it is far from the end of the story.
This practical and technically focused session will examine the latest developments in Division 7A, including recent case law, emerging ATO responses, and the implications of the High Court’s decision for advisers, trustees and private groups. We will explore what Bendel means for existing UPE arrangements, sub-trust structures, complying Division 7A loan agreements, and future trust distribution strategies. We will also consider the continuing operation of Subdivision EA, section 100A and other integrity provisions that remain firmly on the ATO’s radar.
Key topics include:
- The High Court’s reasoning in Bendel and why the ATO’s long-standing UPE position failed
- What happens to existing Division 7A loan agreements and sub-trust arrangements established under previous ATO guidance
- Whether taxpayers should continue to put UPEs on Division 7A terms pending further ATO guidance
- The ongoing relevance of Subdivision EA, section 100A and Part IVA
- Practical trust distribution planning for 30 June 2026 and beyond
- Expected ATO responses, Decision Impact Statements and potential legislative reform
- Recent Division 7A developments, compliance activity and case law updates
Learning Outcomes:
With uncertainty surrounding the ATO’s next steps and significant implications for hundreds of thousands of private groups, this session will provide practitioners with a timely update on where Division 7A stands today, what risks remain, and the practical actions taxpayers and advisers should be considering now.
Suited to:
Tax Agents, accountants, lawyers and other professionals who act for private companies and associated entities (including individuals and trusts) with actual or potential Division 7A issues.
This On Demand recording Includes:
- Recording of the Live Webinar, which can be viewed multiple times, for as long as required
- Presenters contact details for follow up questions
- CPD Quiz
- CPD Certificate
- CPD Report – Logged automatically
- PowerPoint Presentation
- Verbatim Transcript, with Searchability
- Supporting Documentation
Course syllabus
3 lessons
- Video – Division 7A – Bendel, UPEs and the Future of Trust DistributionsVideo
- Feedback Survey QuestionsSurvey
- Knowledge QuizTest
Your presenter
Mark ChapmanH&R Block
is the author of Life and Taxes: A Look At Life Through Tax and has edited and updated the second through to the eighth editions of Australian Practical Tax Examples, published between 2019 and 2025 by Wolters Kluwer CCH Australia.
He has over 30 years experience as a tax professional in both the UK and Australia, specialising in tax for small business and individuals. He is a fellow of the Institute of Chartered Accountants in England and Wales, a fellow of CPA Australia and a member of the Chartered Institute of Taxation. He holds a Masters of Taxation Law with the University of New South Wales.
Since 2015, Mark has been Director of Tax Communications with H&R Block Australia. He writes regularly on tax issues for numerous media outlets and presents on topical tax topics at seminars and other events. He broadcasts frequently on radio and television and writes a regular column for Money Magazine and Yahoo7 Finance. As a tax practitioner in the UK, he occupied a number of senior positions before moving to Australia in 2007 to join the Australian Taxation Office (ATO) as a senior director.