Are all discretionary trusts the same ?

Hi there

I wish to set up a family trusts to purchase future investment properties in . My accountant says he can get a trust deed within 24hrs and have it all set up with a corporate trustee pretty quickly

However - are some trust deeds better than others or are they all the same?

My thinking and research tells me that they are not all the same

Thanks in advance
 
Hi there

I wish to set up a family trusts to purchase future investment properties in . My accountant says he can get a trust deed within 24hrs and have it all set up with a corporate trustee pretty quickly

However - are some trust deeds better than others or are they all the same?

My thinking and research tells me that they are not all the same

Thanks in advance

Hi Richard

No 2 trusts are the same - except those bought from off the shelf document providers.;)
 
Thanks for the reply Terry

So the one my accountant gets is sort of a one size fits all trust whereas a trust obtained from say a lawyer such as yourself can be customed made to fit your needs and wants.

However are the ones my accountant gets good enough to get the job done ? - Can I ask to see the trust deed before I purchase - and say get it assessed by my lawyer before proceeding .

It seems important to get this right before purchasing any property as once its in - I assume it can be very costly to correct - particulary in terms of CGT and stamp duty

Cheers
 
Yes you can ask, but the accountant would have to pay for one before he could let you see it. He also couldn't amend a deed or explain the terms as this is legal advice. An accountants advice would be limited to the tax aspects.

See my book for some good tips on what to look for in a deed.
 
Thanks for that - Terry

I actually fell asleep while reading your book last night - its a good read but I probably shouldn't be trying to read it at midnight
 
Very few accountants have read the trust deeds they sell. I know this as I used to work in the industry. When you read many deeds you start to wonder if the lawyer had even read it too in some instances. You would be shocked at some clauses that exist. Heaps of unit trusts have clauses where trustees have unfettered right of discretion and can even retain profits.

I identified a large and popular trust deed provider that had sold a fixed unit trust that had terms that made it a hybrid trust. OSR NSW blankly said it was NOT a fixed trust. Some trust providers spent years arguing with OSR and ATO over their deeds and later amended them to fix the problems. It takes experience to identify those issues and know not just what fails in the deed but also what practices fail for tax purposes.

The best worded deed will mean jack if its lost, unsigned or the trust resolutions etc are ignored.

I would always use a specialist deed provider. That said I wouldn't assume that all lawyers can provide a decent deed either. Some of them just use cheap online precedents too and may not be tax savvy. I have seen plenty of lawyers and accts setup a standard unit trust or discretionary trust in NSW without being aware of the land tax problem.
 
I no longer advise accountants, lawyers and Financial planners. Or film CPD sessions for the ICAA, Tax Institute and CCH etc.

No I went back into mainstream tax and super practice. Thanks for your enquiry.
 
Back
Top