Do trust assets form part of your estate when you die?
Family Discretionary trusts can provide for asset protection and the preservation of wealth. Trust assets are not legally owned by any beneficiary and therefore cannot be passed by will and do not fall into your estate upon your death.
It is important to pass on control of a family trust in your Will or in the trust deed. The following roles hold control in respect to a family discretionary trust:
- Control of the assets of a trust remains with the parties named in the trust deed as the “appointor/s”. The appointor/s are the persons named in the trust deed who have the power to remove an existing trustee, or nominate an additional or replacement trustee;
- The trustee is responsible for the day to day administration of the trust. The trustee can be one or more individuals, or a company;
- Guardian/Protector. Depending upon your trust deed, some deeds may include a guardian or protector role which provides power to veto key decisions made by the trustee.
It is important that consideration is given in respect to succession of the above roles to ensure that the roles are filled correctly by the correct individuals/companies.
By appropriate consideration of the Appointor provisions, control of the trust, and thereby the trust assets can be passed to the next generation.
If you would like us to review your family trusts deed, please contact us on 07 4417 4417 or admin@mobbsmarr.com.au so that we can assist to ensure that you are aware of who controls your family trust and provide succession to those roles that hold control and ensure that you are aware of the beneficiaries who may benefit from your family trust.