Michael Dirkis


The article examines the issue of whether the "the conduit theory", which enables trustees of discretionary trusts to stream income, has been overridden by the Income Tax Assessment Act 1936. As the author discovers that there are a number strong arguments that indicate income streaming is not possible under the Act, it is argued that, in order to ensure certainty, the Commissioner of Taxation's administrative practice of permitting income streaming should be legitimised by legislative amendment.