All You Need to Know About Setting a Family Trust in Australia all-you-need-to-know-about-setting-a-family-trust-in-australia

Want to set a family trust but do not know how to go about it? Following steps will get you started in your task; however, it is always better to consult a qualified professional in this context.

1. The Trustees

The most important step in the process and the most difficult one too! The person chosen as a trustee should be of high integrity and mindful about their obligations as trustee. They can be:

• Corporate Trustees such as a corporate advisory firm or a banking institution
• Professional such as an investment adviser, accountant, or lawyer
• Non-Professional such as a member of the family

2. Trust Beneficiaries

Deciding on the trust beneficiaries is the next step. The family trust deed will define the class of individuals who can be beneficiaries, lay down the extent of their entitlement and nature of entitlement.

3. Drafting the Family Trust Deed

Drafting the family trust deed follows is the step. Consulting a qualified professional in this context is advisable. 

4: Settle the Trust Property

The family trust deed is to be signed by the ‘settlor’, and the trust property is ‘settled’. A small token of money is provided by the settlor to the trustee. The role of the settlor ends here.

5. Signing the Family Trust Deed

The trustees call for a meeting, where the trust deed is signed by all persons appointed as trustees. 

6. Payment of Stamp Duty

Payment of stamp duty is subject to the requirements of the state you reside. Consulting the relevant state authorities will ensure the completion of all formalities in this context within the stipulated time.

7. TFN and ABN

The Tax File Number (TFN) and Australian Business Number (ABN) have to be obtained on the establishment of the family trust.

8. Bank Account

Opening a bank account in the trustee’s name ‘as a trustee for the trust’ is the final step. The first deposit made to this account is the settlement sum, and all transactions and deposits follow after this step.

Changes to the trust deed can be made by executing a trust deed of variation.