The Johnson Family Trust was created on 1 July 2020 by Liam Johnson contributing $100 into the trust. Shortly afterwards his son Lucas Johnson added $500,000 into the trust. The trust invested $500,000 into the following assets on 15 August 2020:

- 1 (One) Bedroom investment apartment $380,000

- Listed company shares:

500 CBA shares $50,000

10,000 A2M shares $70,000

The trust received the following incomes from above investment assets for the year ended 30 June 2022:

Net rental income $25,600

Unfranked dividends - A2M $2,000

Fully Franked dividends - CBA $7,000

Total income $34,600

When advised of the total income of $34,600, the trustees comprising Liam and Lucas distributed and paid off the total income to the following beneficiaries on 3 July 2022:

- Will Johnson, aged 22(resident, full time university student) $15,000

- Rose Johnson, aged 30 (non-resident) $10,000

- Joshua Johnson, aged 16 (resident, full time student) $9,600

On 28 July 2022, a tax agent completed the preparation of the trust's tax. The net income shown on the tax return was $37,600.

Required:

1) Briefly outline why there is discrepancy between the total income and the taxation 'net income' of the trust.

2) Advise the trustees and the beneficiaries on their tax liability in respect of the net income they received from the trust for the tax year ended 30 June 2022