Questions about Trusts or Trustees? Let us help

Find answers here about Trusts – whether Family (or discretionary) Trusts or other types to protect your assets or distribute your income as you desire. (We also have answers on Charitable Trusts.)  You will see circumstances here to explain how we can help in trustee services.


Commonly asked questions about Trusts

Q. How do trusts work?
A. During your lifetime, Perpetual can help establish a trust to safeguard all or part of your assets in order to invest and/or distribute these assets and income to your beneficiaries in accordance with your wishes. Essentially, with proper advice and structuring, a trust can provide a range of benefits including asset protection, flexibility of income distribution and the ability to help ensure that your or your family's assets are effectively transferred from one generation to the next. Make an appointment with a financial adviser from Perpetual Private Clients to find out more.
Q. What are some advantages of creating a trust as part of your Will?
A. Creating a trust as part of your Will (called a testamentary trust) has advantages like:
  • social security entitlements remain unaffected
  • assets can be designated to pass on to children even if a surviving spouse remarries 
  • greater leverage on income tax and Capital Gains Tax 
  • provisions for children with a disability 
  • assets are protected should a beneficiary suffer adversity (bankruptcy, divorce)
  • provides discretion (or instruction) to the trustees on how the money will be spent
Q. What role does Capital Gains Tax (CGT) play in a trust?
A. The type of assets you have determine how they are affected by CGT regardless of whether they are part of a trust or part of your estate. Trusts are not necessarily a vehicle to avoid or allay CGT – and in some cases have the potential of triggering CGT. But your death will have CGT consequences.
Q. Can Perpetual help set up a compensation trust?
A. In the event a family member (for example, a child) receives a significant award for damages, assets should be managed professionally to ensure that financial needs are covered. We can provide these services and can outline specific provisions.

Perpetual combines a dedication to quality personal service while taking a disciplined and considered approach to investment. This gives our clients confidence and security that their assets are professionally managed to help achieve their financial needs – or, for example, the needs of their disabled child.

In managing a compensation trust, Perpetual’s relationship with a family would ensure that the child’s:

  • living circumstances, the provision of necessary facilities, and the provision of care and maintenance are set up as required
  • quality of life is being maintained and
  • their rights are being recognised and taken into account

Make an appointment with a Perpetual financial adviser to find out more.

Q. Can Perpetual be appointed trustee for an estate in our place should we decline?
A. Perpetual is able to take on the responsibility of continuing trustee. Perpetual has fulfilled this role for generations of families for over 120 years and has skilled and dedicated staff to undertake all the responsibilities.

You and your co-trustee would formally retire by signing a deed to that effect and by the same document Perpetual would be appointed replacement trustee. To ensure that Perpetual will add value to the future management of the trust we would need to undertake a due diligence and discuss Perpetual’s trustee fees with you.

If this scenario sounds familiar and you believe we could be of assistance, contact us.

Q. Can Perpetual act as trustee to sell a property in dispute?
A. Perpetual can act as ‘trustee for sale’ in these circumstances by Court appointment. We act impartially and independently of the property owners and as directed by a Court Order. Our skilled, dedicated staff undertake all the management responsibilities of the property sale.

To add value to the process, we liase with solicitors to ensure the Court Order provides the proper framework for the sale including meeting ongoing expenses and incurred costs.

If this scenario sounds familiar and you believe we could be of assistance, contact us.

Q. Can Perpetual help me manage the affairs of a family trust?
A. Perpetual can provide the trustee with initial personalised financial plan developed by a Perpetual adviser and, where required, a team of experts in financial planning strategies, taxation and legal structures.

We take care of all the administration requirements as part of the implementation of the financial plan, including ensuring the right investments are in our custody for ongoing administration and reporting. We provide ongoing management of the portfolio of assets of the trust with ongoing financial advice through an ongoing relationship with a Perpetual adviser who will monitor the portfolio and provide regular updates and recommendations to ensure the financial plan continues to meet the objectives of the trust.

If this scenario sounds familiar and you believe we could be of assistance, contact us.

 

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