Introducing AshleighOctober 15, 2019
Moving the (business) goal postsDecember 10, 2019
A new act codifying existing trust law and imposing additional obligations on trustees has passed into law. The Trusts Act 2019 becomes effective on 30 January 2021.
Some of the more important matters to be aware of are:
- Trustees must have regard to the context and objectives of the trust – making letters of wishes and other original trust documents very important.
- Trustees must keep copies of all “core documents” (being all documents relating to the trust for the whole lifetime of the trust), and all trustees must hold copies of at least the trust deed and any variation of trust deed.
- There is a presumption that trustees must notify “basic trust information” to every beneficiary, including all discretionary beneficiaries. “Basic trust information” is that the person is a beneficiary, the name and contact details of the trustees, ongoing changes to trustees and that the beneficiary has the right to request a copy of the trust deed and trust information. Before deciding what information to release, trustees must exercise their judgement as to a number of factors set out in the Act. This will require trustees to be proactive and to make some careful decisions.
The Trusts Act aims to lift the standard of trusteeship and to encourage productive co-trustee relationships and productive beneficiary relationships.
Gaze Burt’s trust administration service is working to ensure that trustees comply with their new obligations under this new Act. If you have a trust where your independent trustee is Gaze Burt’s trustee company or a Gaze Burt director personally, we will be in contact over the next 12 months.
This is a good time to consider your general asset planning. It is useful to consider such questions as…
- Is your family trust necessary in your present life circumstances? Perhaps your trust was formed to protect you from business risk, but you are now retired and that risk no longer exists?
- Are the trustees of your trust still appropriate and able to carry out their duties? Trustees who are ageing may no longer be the right trustees for your trust.
- Are the terms of your trust deed appropriate for this new trusts environment? A common problem with older trust deeds is that they often have wide categories of discretionary beneficiaries. With the new Act it will be desirable to restrict the discretionary beneficiaries of a trust as much as possible. We can review your trust deed and make recommendations.
- If it is appropriate to keep your family trust in place, is your letter of wishes for your trust up to date?
- Are your Wills up to date?
- Do you have enduring powers of attorney in place and are your attorneys still appropriate? As the years go by, it becomes necessary to consider appointing a new attorney from a younger generation than yourself, as well as successor attorneys.
Please get in touch here if you think you may need to make some changes based on above.