Taxation, trusts and the distribution of benefits

Project status: 
Past

Project Overview

The vexed issue of best practice in structuring agreements for taxation, creation of trusts and distribution of benefits from native title has been virtually undocumented. The lack of understanding of these issues makes policy development, for example in relation to the taxation of native title payments almost impossible. This project has sought to provide initial baseline data and qualitative information through identifying issues, surveying current practice, suggesting good practice examples, and promoting the sharing of information and experience. See also the Native Title Research Unit's involvement in taxation and trusts related workshops.

Research Publications and Resources

Native title is a unique legal concept that seeks to bridge the rights held by Indigenous peoples under their own law and an accommodation and protection of those rights within Australia law.  Its recognition required an immediate rethinking of Australia property law and the way in which governments, in particular, dealt with land. 

An agreement making framework was developed to facilitate access to land where native title has been found to exist or is under native title claim.  However, the common law and legislative framework have constrained native title as an economically valuable right. 

These legal constraints are strangely at odds with the tendency to presume that native title will be an economic boon for Indigenous peoples.  This is teamed with the rhetoric of respondents and interest groups, particularly in the years surrounding the 1996 Wik decision and subsequent amendments to the NTA, that native title is a significant cost to industries and the economy more broadly.

Despite the restrictive framework of native title law, Indigenous groups are active in negotiating agreements over land and water matters, both inside and outside the framework of the NTA. 

Some of the agreements being reached involve payments and benefit packages that are complex and in almost all circumstances raise significant questions, both conceptually and practically, as to their treatment for taxation purposes.  But little analysis has been done to determine how native title fits with the tax system and resolution of the question has eluded a generation of policy makers.

The Native Title Research Unit has produced various publications and resources relevent to the taxation of native title.

  • Strelein, L, 2008,Taxation of Native Title Agreements (pdf 274 Kb), Research Monograph 1/2008, Native Title Research Unit, Australian Institute of Aboriginal and Torres Strait Islander Studies, Canberra.

    This research monograph explores issues of native title taxation and proposes potential resolutions.

  • Native Title Research Unit, 2008,  Taxation of Native Title Benefits (pdf 66Kb), Native Title Research Unit, AIATSIS, Canberra.

    This document details key taxation legislation, cases and literature relevant to the native title payments and agreements.

  • Native Title Research Unit, 2008, Native Title Payments and Benefits: Literature Review (pdf 452 Kb), Native Title Research Unit, AIATSIS, Canberra.

    This paper reviews the current literature and information on native title agreements; identifies key research questions; and suggests the need for further systematic research and cooperation within the native title sector so to understand the scope and nature of native title payments and benefits.

  • Native Title Research Unit, Native Title Payments: Selected Bibliography (pdf 228 Kb), Native Title Research Unit , AIATSIS, Canberra, 2008.
  • Summary of relevant recent decisions: Shire of Derby West Kimberley v Yungngora Association 25Kb

See also relevant resources on tax incentives for indigenous economic development:

Submissions

 The NTRU's research into the taxation of native title payments has informed a submission to the House of Representatives Standing Committee on Aboriginal and Torres Strait Islander Affairs inquiry into developing Indigenous Enterprise. The NTRU also prepared a submission to the Australia's future tax system review.

Native Title Taxation Advice

A group of legal firms met in Sydney on 3 May 2007 agreeing to accept requests for advice and to develop Fact Sheets on corporate structuring, commercial arrangements, taxation and trusts issues affecting native title representative bodies and native title services.

Requests for advice under this initiative are being coordinated by the Native Title Research Unit and the Aurora Project with assistance from the National Pro Bono Resource Centre. Requests for advice should relate to corporate structuring, commercial arrangements, taxation and trusts issues. Principal Legal Officers of native title representative bodies or native title services are invited to submit requests for assistance through the Native Title Research Unit.

Please contact Ms Lara Wiseman at the Native Title Research Unit on 02 6261 4244 or lara.wiseman@aiatsis.gov.au for further information about this initiative or to submit a request for advice.

Workshop papers and presentations

2007

Pro Bono Legal Advice for Native Title Representative Bodies and Native Title Services, Sydney, 3 May 2007

A three-day NTRB Legal Masterclass was held in Sydney in July 2007 to focus on specific aspects of law which experienced NTRB staff had previously identified as pivotal to their native title work. The Masterclass included half-day sessions on: mining and resources law; law and practice of native title transactions; taxation and trusts. It concluded with a Native Title forum, which focussed on recent developments in native title law, particularly significant full Federal Court decisions and the implications of the decisions.

The key facilitators of the program were Sean Brennan (University of New South Wales), Lisa Strelein (AIATSIS) and David Yarrow (Monash University). They were supported by a variety of guest speakers with expertise in the specific topics, including a special guest speaker, Justice Murray Wilcox. Staff from 10 NTRBs attended the Masterclass.

One session which participants found particularly useful was Alexandra Richards QC’s presentation of Monday 30 July regarding the interaction of the law of trusts with Native Title. The following is a summary of that session:

2006

Senior Professional Officers' Workshop: Taxation, trusts and the distribution of benefits under native title agreements, University of New South Wales, September 2006 

At the Senior Professional Officers Workshop conducted at the University of New South Wales in September 2006, representatives from native title representative bodies (NTRBs) and native title service providers (NTSPs) met and discussed problems that have emerged, legal options available to claimants and the outcomes these have produced. The outcomes and key themes of the workshop have been summarised in a Workshop report.

  • Strelein, L & Tran, T. 2007. Senior Professional Officers Workshop: Taxation, Trusts and the Distribution of Benefits, (pdf 141 Kb) Native Title Research Report, No. 1/2007, Native Title Research Unit, AIATSIS, Canberra.

    This report details the major themes raised during a discussion on issues of taxation, trusts and the distribution of benefits that have arisen in various NTRB service areas. This is followed by specific case studies and a description of future directions for NTRB/NTSPs in dealing with these issues.

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Last reviewed: 3 May 2016