TAX GUIDE You should use this guide if. You may wish to give this guide to your accountant or tax agent

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1 TAX GUIDE Tax Return Information Statement Guide This guide will help you to complete your tax return using your Tax Return Information Statement from Colonial First State You should use this guide if you have received distributions during the financial year from the following Colonial First State products: FirstChoice Investments FirstChoice Wholesale Investments Colonial First State Managed Investment Funds Colonial First State Wholesale Investments Wholesale Mezzanine Investments You may wish to give this guide to your accountant or tax agent You will receive A separate Tax Return Information Statement for each investment you hold in the products listed above If you have withdrawn from your investment (including to pay an adviser service fee) or switched investments during the year you may also receive a Capital Gains Tax Information Statement from Colonial First State All this information needs to be included when you complete your income tax return This guide contains general information and is not tax advice Please contact your tax agent or accountant about personal tax matters For general enquiries about your Colonial First State investments please refer to Frequently asked questions on page 8 or call Investor Services on Monday to Friday 8am to 7pm Sydney time You can view this guide by clicking on the Find a form tile in the Personal section of our website at colonialfirststatecomau and selecting the Tax Guides tab This document has been prepared by Colonial First State Investments Limited ABN AFS Licence (Colonial First State) based on its understanding of current regulatory requirements and laws as at 30 June 2017 This document is not advice or tax advice and provides information only It does not take into account your individual objectives financial and taxation situation or needs Copyright in the Individual tax return instructions and individual tax return forms for 2017 subsists in the Australian Taxation Office You should discuss the information in this tax guide with your financial adviser and your accountant or tax adviser You should read the relevant Product Disclosure Statement available from the product issuer carefully and assess whether the information is appropriate for you and consider talking to a financial adviser before making an investment decision Taxation considerations are general and based on present taxation laws and may be subject to change You should seek independent professional tax advice before making any decision based on this information Colonial First State Investments Limited is also not a registered tax (financial) adviser under the Tax Agent Services Act 2009 and you should seek tax advice from a registered tax agent or a registered tax (financial) adviser if you intend to rely on this information to satisfy the liabilities or obligations or claim entitlements that arise or could arise under a taxation law 1

2 This guide helps you in 3 ways 2 Understand the different Declare distributions from your Colonial First State investments in your personal tax return tax components of your distributions with a Definitions page (these are on page 7 of this guide) 3 Answer some Frequently asked questions that might save you a phone call See page 8 of this guide To complete your 2017 tax return you will need: The ATO Individual tax return instructions 2017 The ATO Individual tax return instructions supplement 2017 The ATO Tax return for individuals 2017 The ATO Tax return for individuals (supplementary section) 2017 Your Tax Return Information Statement for each of the Colonial First State products you hold that are listed on the front page of this guide You will also need taxation information statements from any other income paying sources Your Capital Gains Tax Information Statement for each of the Colonial First State products from which you have withdrawn (including to pay an adviser service fee) or switched during the year and a copy of the Colonial First State Capital Gains Tax Information Statement guide This guide is not necessary if you have not withdrawn (including to pay an adviser service fee) or switched investments during the year Your quarterly/half-yearly statements if you have paid an adviser service fee If you have capital gains from other sources or capital losses you may also need the Personal investors guide to capital gains tax 2017 available from the Australian Taxation Office (ATO) General points when using this guide Even if you have reinvested your distributions they still need to be included in your tax return If you have other Colonial First State investment products and/or income from other sources you need to include all of these amounts in your income tax return If you have borrowed money to invest in any Colonial First State investment products you may be able to claim a tax deduction for any interest you have paid (where your borrowing is capital protected you should seek specialist taxation advice) If you have paid an adviser service fee you may be able to claim a tax deduction for this The information in this guide is for use by Australian resident individuals in the completion of the tax return Please read all the instructions in this guide before you complete the Tax return for individuals (supplementary section)

3 You will need to refer to the Tax return for individuals (supplementary section) 2017 and your Tax Return Information Statement to complete the following steps Summary of Tax return for individuals (supplementary section) items Part A Tax Return (supplementary section) Refer to Part A of your Colonial First State Tax Return Information Statement Then follow the headings step-by-step Non-primary production income (13U) Refer to your Tax Return Information Statement; Non-primary production income will have an amount next to it and a Tax Return Label (13U) on your Tax Return Information Statement Enter this amount (plus any other amounts of non primary production income you have from other trusts) at Question 13 U of your Tax return for individuals (supplementary section) 2017 Other deductions relating to distributions (13Y) Refer to your Tax Return Information Statement; there may be an amount shown to the right of Other deductions relating to distributions next to Tax Return Label (13Y) for the financial year You may also have other deductions that you can claim against the amount you have entered at 13 U (Note: prepaid interest may not be fully tax deductible) Deductions you may be able to claim include any adviser service fee you have paid during the year interest on loans used to finance your trust investments or other expenses incurred when earning income from your investments (for example bank charges) Enter the total deductions at Question 13 Y of your Tax return for individuals (supplementary section) 2017 Subtract the total deductions at Y from any amount you entered at U The result should be entered in the Net nonprimary production amount box in Question 13 If this is a negative amount (a loss) print L in the Loss box to the right of this figure Franked distributions (13C) Refer to your Tax Return Information Statement; Franked distributions may have an amount to the right of it and a Tax Return Label (13C) on your statement Enter this amount (and include any franked distributions you received from other trust partnership distributions) at Question 13 C of your Tax return for individuals (supplementary section) 2017 Franked distributions for direct share investments should not be included here but at Question 11 in the Tax return for individuals 2017 (not the supplementary section) Franking credits (13Q) Refer to your Tax Return Information Statement; Franking credits (also referred to as imputation credits) may have an amount to the right of it and a Tax Return Label (13Q) on your statement Enter this amount (and include any franking credits you received from other trust or partnership distributions) at Question 13 Q of your Tax return for individuals (supplementary section) 2017 Franking credits for direct share investments should not be included here but at Question 11 in the Tax return for individuals 2017 (not the supplementary section) You should seek professional advice if you have disposed of investments shortly after receiving a distribution with franking credits Credit for Tax File Number (TFN) amounts withheld (13R) Refer to your Tax Return Information Statement; Credit for TFN amounts withheld Tax Return Label (13R) may have an amount to the right of it Enter this amount at Question 13 R of your Tax return for individuals (supplementary section) 2017 Total current year capital gains (18H)/ Net Capital Gain (18A) If you have no amount to the right of Net Capital Gain (18A) go to Assessable foreign source income at the top of page 5 of this guide If there is an amount shown print X in the YES box at Question 18 G on your Tax return for individuals (supplementary section) 2017 then work out which circumstance applies to you from the three options below Do you have: Option 1 Capital gains from Colonial First State only and no capital losses Follow the steps for Option 1 below Option 1 Option 2 Capital gains from Colonial First State and other sources and no capital losses Follow the steps for Option 2 on page 5 Option 3 Capital gains from Colonial First State and other sources and capital losses Go to Assessable foreign source income and Rebates on page 5 and then Part B on page 6 Question 18 If you have an amount to the right of Total current year capital gains on your Tax Return Information Statement enter this amount at 18 H on your Tax return for individuals (supplementary section) 2017 Take the amount to the right of Net capital gain on your Tax Return Information Statement and enter it in at 18 A Normally the difference between Total current year gains and Net capital gains is the CGT discount percentage applied For example a 50% discount is applied to gross capital gains held for more than 12 months for individual investors Then go to Assessable foreign source income on page 5 of this guide 3

4 Tax return for individuals (supplementary section) July 2016 to 30 June 2017 Use Individual tax return instructions supplement 2017 to fill in this tax return Please print neatly in BLOCK LETTERS with a black or blue ballpoint pen only Do not use correction fluid or tape Print one letter or number in each box Print X in appropriate boxes Complete your details carefully to avoid delays in processing your tax return Investor account type Your tax file number (TFN) Your name Title for example Print your full name Mr Mrs Ms Miss INCOME continued 14 Personal services income (PSI) To complete this item you need to read and complete the Business and professional items schedule for individuals 2017 You cannot lodge a paper return You must lodge your tax return using mytax or a registered tax agent 15 Net income or loss from business To complete this item you need to read and complete the Business and professional items schedule for individuals 2017 You cannot lodge a paper return You must lodge your tax return using mytax or a registered tax agent 16 Deferred non-commercial business losses To complete this item you need to read and complete the Business and professional items schedule for individuals 2017 You cannot lodge a paper return You must lodge your tax return using mytax or a registered tax agent 17 Net farm management deposits or repayments 18 Capital gains Mr Sam Sample 1 Harbour Street SYDNEY NSW Foreign entities Deductible deposits Early repayments natural disaster and drought Did you have either a direct or indirect interest in a controlled foreign company (CFC)? Have you ever either directly or indirectly caused the transfer of property including money or services to a non-resident trust estate? Also include at F Australian franking credits from a New Zealand franking company that you have received indirectly through a partnership or trust distribution I W NO YES NO YES 20 Foreign source income and foreign assets or property Assessable foreign source income D E Net foreign employment income payment summary U CFC income K Transferor trust income B Sensitive (when completed) Page 14 TAX RETURN FOR INDIVIDUALS (supplementary section) Net foreign pension or annuity income WITH an undeducted purchase price D N Australian franking credits from a New Zealand franking company F Exempt foreign employment income Foreign income tax offset During the year did you own or have an interest in assets located outside Australia which had a total value of AUD$50000 or more? N R Other repayments Did you have a capital gains tax event during the year? Have you applied an exemption or rollover? G NAT M H Net farm management deposits or repayments Other net foreign employment income T Net foreign pension or annuity income WITHOUT an undeducted purchase price L O P Total current year capital gains Net capital losses carried forward to later income years Credit for foreign resident capital gains withholding amounts V X INCOME FirstChoice Investments Other net foreign source income M NO YES E Net foreign rent R NO YES You must print X in the YES box at G if you had an amount of capital gains from a trust NO YES CODE Net capital gain A Surname or family name Given names Sensitive (when completed) Page 13 See the Privacy note in the Taxpayer s declaration on page 10 of your Tax return for individuals Partnerships and trusts Include any deferred non-commercial business losses from a prior year at X or Y 2016/17 Tax Return Information Statement Primary production as appropriate and insert the relevant code in the TYPE box Distribution from partnerships Share of net income from trusts Landcare operations and deduction for decline in value of water facility fencing asset and fodder storage asset Other deductions relating to amounts shown at N and L Non-primary production Distribution from partnerships less foreign income Share of net income from trusts less capital gains foreign income and franked distributions Franked distributions from trusts Share of credits from income and tax offsets Share of credit for tax withheld where Australian business number not quoted Share of franking credit from franked dividends Share of credit for tax file number amounts withheld from interest dividends and unit trust distributions Credit for TFN amounts withheld from payments from closely held trusts Share of credit for tax paid by trustee Share of credit for foreign resident withholding amounts (excluding capital gains) Share of National rental affordability scheme tax offset B S A P Q R M J Y O U C X N L I TYPE Net primary production amount If you have any questions about this statement please talk to your financial adviser or accountant You can call Investor Services on Monday to Friday between 8am to 7pm Sydney time Landcare operations expenses Other deductions relating to amounts shown at O U and C Net non-primary production amount Partnership share of net small business income less deductions attributable to that share Trust share of net small business income less deductions attributable to that share Part A Summary of 2017 tax return D E (supplementary section) items Tax return (supplementary section) Amount ($) Tax return label Non-primary production income U Other deductions relating to distributions 0 13Y Franked distributions C Franking credits Q Credit for TFN amounts withheld 0 13R Total current year capital gains H Net capital gain A Assessable foreign source income E Other net foreign source income M Foreign Income Tax Offset O Rebates V Part B Capital gains tax information additional information for item 18 Account number: Account type: Individual Account name: Sam Sample Capital gains - discount method (grossed up amount) Capital gains - indexation method 0 Capital gains - other method 0 Total current year capital gains Capital gains tax concession amount Tax-deferred amounts 2010 Use this statement together with the tax guide to help you complete your tax return Tax guides are also available on our website at colonialfirststatecomau PLEASE RETAIN THIS STATEMENT FOR INCOME TAX PURPOSES TYPE Show amounts of: capital gains from trusts at item 18 and foreign income at item 19 or 20 Show amounts of: credit for foreign resident capital gains withholding from trusts at item 18 This document has been prepared by Colonial First State Investments Limited ABN AFS Licence (Colonial First State) based on its understanding of current regulatory requirements and laws Colonial First State is the issuer of the FirstChoice range of super and pension products from the Colonial First State FirstChoice Superannuation Trust ABN Colonial First State also issues interests in products made available under FirstChoice Investments and FirstChoice Wholesale Investments other than FirstRate Saver FirstRate Term Deposits and FirstRate Investment Deposits which are products of the Commonwealth Bank of Australia ABN AFS Licence (the Bank) Colonial First State is a wholly owned subsidiary of the Bank The Bank and its subsidiaries do not guarantee the performance of FirstChoice products or the repayment of capital for your investment This document is not advice and provides information only It does not take into account your individual objectives financial situation or needs You should read the relevant Product Disclosure Statement (PDS) carefully and assess whether the information is appropriate for you and consider talking to a financial adviser before making an investment decision PDSs for the FirstChoice range of products are available at colonialfirststatecomau or by calling us on ( Investor Services : colonialfirststatecomau Page 1 of 2

5 Option 2 For capital gains from other sources you may need to use the Personal investors guide to capital gains tax 2017 which is available from the ATO The guide provides step-by-step instructions to calculating the amounts needed to complete your tax return Question 18 If you have an amount to the right of Total current year capital gains on your statement add this amount to gains received from other sources (calculated using the ATO guide) The sum of these amounts should be entered at 18 H of your Tax return for individuals (supplementary section) 2017 Take the amount to the right of Net capital gain and add this amount to your net capital gain from other sources (calculated using the ATO guide) The sum of these amounts should be entered at 18 A Then go to Assessable foreign source income below Foreign income tax offset (20 O) If you have an amount next to foreign income tax offsets on your tax statement (and you do not have any other foreign income tax offsets from another source) include that amount in your Tax return for individuals (supplementary section) 2017 at 20 O Rebates (24V) If your tax statement has an item called Rebates with an amount next to it include that amount in your Tax return for individuals (supplementary section) 2017 at 24 V Also write Rebates in the Type of income Category 2 description box next to 24 V Assessable foreign source income (20E) If you have an amount to the right of Assessable foreign source income on your Tax Return Information Statement (and you do not have any other foreign source income from another source including foreign employment or foreign pension/annuities) then enter the amount to the right of Assessable foreign source income at Question 20 E If you do have foreign income from foreign employment and/or foreign pensions and annuities you will need to refer to the instructions for Question 20 in the Individual tax return instructions supplement 2017 You should seek professional advice if you have deductions or losses carried forward relating to foreign income Other net foreign source income (20M) If you have an amount to the right of Other net foreign source income on your Tax Return Information Statement (and you do not have any other foreign source income from another source (including foreign employment income or foreign pension/ annuity income) then include the total to the right of Other net foreign source income at Question 20 M If you have foreign employment income or foreign pension/ annuity income you will have to follow the instructions for Question 20 in the Tax return for individuals (supplementary section) 2017 You should seek professional advice if you have deductions or losses carried forward relating to foreign income Note: If you have Other net foreign source income or Assessable foreign source income from other sources (ie other managed fund distributions) you will need to combine these amounts before completing your tax return 5

6 Follow these instructions if you have any capital losses (either this year or prior years) Total components of distribution Part B We have calculated the amounts of capital gains that need to be included in your tax return as they relate to the distributions from your Colonial First State investments If you have capital gains from other sources you may need to use the Personal investors guide to capital gains tax 2017 which is available from the ATO That guide provides step-by-step instructions to calculating the amounts needed to complete your tax return For gains from other sources you will need to separately calculate an indexed capital gain amount a discounted capital gains amount and a capital gains other amount These amounts need to be added to the amounts distributed from Colonial First State as shown under the heading Capital gains tax information additional information in Part B of your Tax Return Information Statement Add the figure shown at Total current year capital gains to any other gains you have including capital gains from sale of your units in Colonial First State Trusts and enter the total at Question 18 H If you have any capital losses for the tax year or prior year capital losses brought forward (these will be shown at box V of Question 18 of your tax return supplement) you must nominate the capital gain against which these losses are to be applied Typically they will be applied firstly to capital gains indexation method then to capital gains other method and lastly to the discounted capital gains The way you apply your capital losses will place you in one of three situations: Situation A Where the total of the financial year capital losses and any prior year s capital losses exceed the Total current year capital gains (that you have included at box H at Question 18 on your tax return) the excess should be entered into box V at Question 18 No amount should be entered in box A Situation B Where the total of the financial year capital losses and any prior year s capital losses fully offset the amounts shown at Capital gains indexation method and Capital gains other method then the amount shown against Capital gains discount method (that you have included at box H at Question 18 on your tax return) should be reduced by any remaining loss The end figure should then be divided by two and this amount entered into box A of Question 18 (If the investment is made by a company no division is required; if a superannuation fund then multiply by 2 3) Situation C Where the total of the financial year capital losses and any prior year s capital losses do not exceed the Capital gains indexation method and Capital gains other method then deduct the amount of the loss from the amount shown in Part A of your Tax Return Information Statement opposite Net capital gain (18A) The reduced amount should be entered at Question 18 A Please note: If you have capital gains from other sources including gains made on sale of your units you will need to include these gains in the situations A B and C 6

7 Definitions Capital gains definitions CGT concession amount This amount represents the non-taxable component of a discounted capital gain That is the amount is 50% of a capital gain that is not assessable to an individual We have altered the calculation of this amount if you are a company or superannuation fund so the concession reflects no discount or 1 3 discount respectively (Your account type is shown on the top right hand corner of the first page of your Tax Return Information Statement) Discounted capital gains This amount represents capital gains on assets held for more than 12 months and has been discounted by 50% Where your investment is made by a: super fund we have discounted by 1 3 company no discount has been made trust the 50% discount has been applied Capital gains indexation method This amount represents capital gains that have been calculated using the indexation method which adjusts for inflation Indexation was frozen from September 1999 Capital gains other method This amount represents capital gains made on assets held for less than 12 months Such gains do not qualify for either indexation or the CGT discount Additional capital gains information These amounts represent the sum of all capital gains amounts distributed to you and is provided to help you complete your return if you have capital losses TARP and NTARP Capital Gains TARP are capital gains from Taxable Australian Real Property Capital Gains NTARP are capital gains from assets that are Not Taxable Australian Real Property If you are a resident of Australia for tax purposes this distinction is irrelevant If you are not a resident of Australia for taxation purposes this distinction may affect the amount of withholding tax deducted from your distribution Other definitions Credits for TFN amounts withheld If you have not supplied your tax file number (TFN) (or relevant exemption) to Colonial First State we have deducted tax at the top marginal rate plus medicare (and any other applicable levies) from your distribution and paid it to the ATO This TFN withholding tax will be offset against the tax payable on your income and may be refunded to you by the ATO when you lodge your tax return Should you wish to prevent this from happening again please provide us with your TFN as soon as you can Tax-free amounts This category represents non-taxable income derived by the fund This income will usually be from infrastructure investments Tax-deferred amounts This category represents distributions that are not taxable to you They have arisen due to differences between accounting and taxable income eg those due to different depreciation rates which is common for investments in Property Trusts or REITs Tax deferred income may alter your cost base for CGT purposes when you redeem your units Net cash distribution The total distributions you have received (including any which have been reinvested) Withholding tax If you are not a resident of Australia for tax purposes Colonial First State is required to withhold tax from some components of your distribution Interest withholding tax is deducted from Australian interest income and dividend withholding tax is deducted from unfranked dividends paid by Australian companies Other components may also be subject to tax under subdivision 12 H of the Australian Income Tax legislation Please see your accountant for further information 7

8 Frequently asked questions Can everyone use this guide? Under certain circumstances you may not be able to use this guide to complete your tax return The following scenarios outline some of these circumstances and we encourage you to seek professional advice if you think they apply to you: You have any expenses or carried forward foreign losses relating to foreign source income This is because your entitlement to foreign income tax offsets may be affected You changed your residency status during the tax year If you became a non-resident during the year you may need to lodge an Australian tax return for the part of the year that you were a resident If you became a resident during the year you may need to apportion your distributions to the respective periods You disposed of your investment shortly after receiving a distribution containing a franked dividend component Can I claim a tax deduction for management fees and expenses of the funds? No the management fees and expenses have already been deducted from distributed income and are reflected in the unit prices I m not completing a tax return can I still claim my franking credits? Yes you may still be able to claim your franking credits You can download a copy of the form Application for refund of franking credits for individuals from wwwatogovau If the investment is made by a company trust superannuation fund or partnership is the information in this guide relevant for its tax return? This guide is mainly prepared to assist individual investors to complete their tax return However your Tax Return Information Statement is relevant Some of the definitions and general information may also be of use to your accountant or financial adviser Can a mastertrust or IDPS use this guide? A A Yes however you need to ensure that the investor s tax status (Individual Trust Company or Superannuation Fund) has been correctly recorded as this affects the capital gains information provided (The account type is shown on the top right hand corner of the first page of your Tax Return Information Statement) Can the franking credits exceed the amount of my Australian income? Franking credits can exceed the amount of Australian income included in your distribution because the management expense is deducted from the fund before the distribution payment For example let s say the fund income is $100 and franking credits are $50 If the fund s expenses are $60 then income distributed to investors will be $40 while franking credits remain at $50 Why are my concessional capital gains greater than my taxable capital gains? This can happen due to the way expenses are allocated against income and capital gains For example the fund has a gross capital gain of $100 and management fees of $10 The CGT concession amount will be $50 because of the 50% discount The management fees of $10 are allocated against the taxable part of the capital gains ($50 $10) which reduces the discounted capital gain to $40 My Account Type is Joint or Partnership how should I use this tax guide? This guide assumes an individual taxpayer client Only one statement per account is issued You will need to apportion the amounts on the tax statement accordingly For example if your account is a joint account you will need to halve the amount on your statement and include the reduced amount in your respective individual tax return Want more information? For enquiries about your personal tax matters please talk to your financial adviser or accountant For general enquiries about your Colonial First State account please call Investor Services on Monday to Friday 8am to 7pm Sydney time or contactus@colonialfirststatecomau A/FS836/0617