An inter vivos trust derived $25,000 interest income and $7,000 90% franked dividend during the current tax year. The trust net income was sought to be distributed according to the following distribution:

• $18,000 including the franked distribution to Brian who is aged 56 and an Australian resident with no other income; and
• the remaining amount distributed to Ted, a foreign resident.

Required:

State whether the following statements are true or false. Explain your answer and support with relevant income tax legislation.

1. The trustee will pay tax on the trust distribution to Brian at ordinary marginal tax rate.
2. Ted will pay tax on the trust distribution made to him at foreign resident tax rate.
3. Calculate net trust income and tax payable by the trustee and each beneficiary.