Estate Proceeds Trusts:

Trusts can be created voluntarily, by statute or court order, through an act during a lifetime or by will. One situation in which a trust can be created is for the proceeds of an estate. Sometimes when a person deceases, they do not wish for the estate assets to immediately be released to their chosen beneficiaries. Establishing a trust structures allows for a certain level of control in terms of how the Estate assets are distributed, the timing and the manner in which capital and income is distributed. Furthermore, you may receive certain assets from an estate and it may be more tax effective, commercially pragmatic and sensible to manage those assets through a trusts structure rather than receive the asset directly. There are many benefits from managing estate assets through a trust structure and a qualified Asset Protection & Trusts Lawyer can assist you with this.

Fundamentally, a well arranged estate plan should do a number of things. It should create an ordered, secure, yet simple and flexible overall regime for you financial affairs with respect to your current circumstances and for the foreseeable future. Your estate plan should also provide scope for acquiring and accumulating assets during your life; balancing the competing interests of enjoyment of property and income during life. It should also be a vehicle for the preservation or creation of capital for your beneficiaries upon death. In addition, it should seek to minimise taxes during and after your lifetime. Your estate planning arrangements should be simple enough to easily manage, be of reasonable cost, be flexible to cope with changes and shocks and not create difficulties for family or other beneficiaries. Your estate plan should have a required level of complexity to meet your needs such as including  companies, trusts or settlements but not to the extent that it creates unnecessary complication and difficulty. Consultation with an experienced Asset  Protection and Trust Estates Lawyer can ensure your estate is properly managed from a family perspective.

One reason for utilising an estate proceeds trust is asset protection for the primary or principal beneficiary. There is significant protection that a testamentary trust offers against the creditors of a primary or principal beneficiary. Thus, testamentary trusts are a means of ensuring that a primary or principal beneficiary does not forfeit an inheritance because of bankruptcy. This means that in practice, estate proceeds trusts offer an increased, rather than absolute, level of family law asset protection for a primary beneficiary. Obtaining sound legal advice from an Asset Protection & Trusts Lawyer may ensure that your assets are adequately protected in a testamentary trust from bankruptcy and family breakdowns.

Furthermore, an Estate Proceeds Trust can provide various taxation benefits. For instance a trust can generate “excepted trust income” for beneficiaries who are minors. This means that the trust income is not subject to the penalty rates that otherwise apply to a minor’s non-personal exertion income. Also, trusts can be used to fund the education or maintenance of a child or grandchild. In addition, Capital gains tax (CGT) concessions apply to the transfer of estate assets in and out of testamentary trusts. Holistic and solid advice in Wills and Estates Law may be of great value in formulating a testamentary trust which is suitable for your requirements.

If you need further legal advice on your matter, you may book an appointment with us by telephone on (02) 9233 4048 or by email to info@navado.com.au. 

This webpage (and any material or wording appearing on this webpage) is provided for general information purposes only and does not constitute any Legal Advice. It does not take into account your objectives, your instructions or all of the relevant facts and/or circumstances. Navado accepts no responsibility to any person who relies on the information provided on this website. We further refer you to our Disclaimer.