The Trusts Act 2019 will be in force on 30 January next year.
These legal changes mean that the reasons for retaining a trust may now be marginal. For these clients it would be right to be thinking has my Trust become obsolete?
While the return on capital is less, the administrative and compliance costs of trusts has grown. It may be time to ask if your trust has served its purpose and should be dissolved.
By the disclosure rules of the Trusts Act 2019 and other laws we know that in the future there will be more focus on trustees’ performance. Even a simple home owning trust must now have an IRD number. AML procedures flag family trusts for extra attention. Professional trustees demand more paper reporting and more communication with clients’ families. Cases indicate that family members who live on or work on trust property may have rights never before dreamed of. Families by definition, change in the generation since their trusts were settled. Everywhere there is more administrative cost, more record keeping, and more compliance.
If you have a trust, ask yourself:
- Do you absolutely know that the trust settlement you made will do the job for your family now and into the future?
- Who will run the trust and will they do this properly?
For further information, or to make an appointment please call us on 03 477 8080.