By Peter Nevile
If you have not reviewed your family trust for some time, then we recommend that you do so as a matter of some urgency. Among other issues, it is very important to ensure the trust deed excludes foreign beneficiaries; otherwise, there are significant unintended adverse tax consequences.
The second issue relates to family trust distribution Tax (FTDT). The ATO has put out a warning that if applicable, you have until the end of 2026 to report, pay that FTDT liability, and potentially remit up to 80% of the general interest charge applied to historic tax debts. These family trust election errors, which should result in money being distributed outside family groups, trigger an FTDT liability.
The ATO is also showing renewed interest in service trusts. These are quite widely used by professionals.
We recommend that you consult with your accountant, and if you would like a review of your trustee, then please don’t hesitate to contact us; we would be delighted to assist.
Wills – Are they current?
We are being approached by a number of our clients who have not reviewed their Wills for a number of years. It is also surprising how many have not had enduring powers of attorney, financial and medical. As we often say, if you’re not going to die, then you don’t need a Will,….. but you will.
These days, particularly with so many blended families, it is important to ensure that your Will makes adequate provision to give effect to your wishes. We have seen an increase in claims from parties who believe that they have an entitlement resulting from a moral obligation by the Willmaker/Testator The courts appear to be increasingly sympathetic to some of those claims. Accordingly, it is important that if you intend excluding people ,often with very good reasons as a result of blended families, that you provide very specific reasons.in your Will.
If you have any questions and you would like to arrange a consultation with Tracey Collins, who is our accredited specialist in Wills and Estate planning, then please don’t hesitate to contact us.
Disclaimer: This publication contains comments of a general and introductory nature only and is provided as an information service. It is not intended to be relied upon as, nor is it a substitute for specific professional legal advice. You should always speak to us and obtain legal advice before taking any action relating to matters raised in this publication.
