Family Trusts
Protecting Wealth for Future Generations
A Family Trust is a popular and effective way to manage family assets, protect wealth, and plan for the future. Whether you’re looking to minimise tax, support your children, or structure your estate, a family trust can provide flexibility and long-term financial security.
What is a Family Trust?
A Family Trust, also known as a discretionary trust, is a legal arrangement where a trustee holds and manages assets on behalf of beneficiaries, usually family members.
Settlor
The person who establishes the trust
Trustee
The person or company who manages the trust.
Beneficiaries
The individuals who may benefit from the trust (typically family members).
What Is A Family Trust Used For
Asset Protection
Helps protect assets from business risks, creditors, or legal claims.
Tax Planning
Income can be distributed to beneficiaries in a tax-effective way
Succession Planning
Allows you to pass wealth to the next generation with more control.
Support for Family
Provide for children, grandchildren, or dependents over time.
Privacy
Trusts don’t form part of a public record in the same way a will does.
How Does a Family Trust Work?
Once the trust is established, the trustee:
01
Controls and manages the trust assets (e.g. investments, property, business income)
02
Distributes income or capital to beneficiaries as they see fit (within the trust deed rules)
03
Complies with legal obligations, including tax reporting and record-keeping.
Trusts can operate for up to 80 years (depending on the state) and are governed by a trust deed, which sets out the rules and powers of the trustee.
Setting Up a Family Trust
- Preparing a trust deed tailored to your needs
- Choosing your trustee(s) – either individuals or a corporate trustee
- Appointing beneficiaries
- Applying for a Tax File Number (TFN) and ABN (if required)
- Opening a trust bank account
It’s important to get the structure right from the beginning – this is where legal and financial advice is essential.
Ongoing Responsibilities
Trustees must:
- Act in the best interests of the beneficiaries
- Follow the trust deed and trust law
- Keep accurate records and financial statements
- Lodge trust tax returns annually.
Failure to comply with these duties can lead to legal and financial consequences.
Trustees must:
Ongoing Responsibilities
Failure to comply with these duties can lead to legal and financial consequences
Do You Need Legal Help?
While setting up a trust may seem straightforward, every family and financial situation is different. We can help you by directing you to a skilled and trusted law firm to help ensure your trust is legally sound, tax-effective, and built to suit your goals.
Act in the best interests of the beneficiaries
Follow the trust deed and trust law
Keep accurate records and financial statements