Trusts
Trusts
Perth Commercial & Corporate Lawyers
A trust is a commonly used legal structure where a trustee holds and deals with the trust property for the benefit of beneficiaries. Common types of legal trusts we work with includes unit trusts, discretionary trusts, hybrid trusts and partnerships of trusts.
West Perth Legal assists with:
- Advising clients on suitable trust structures
- Documenting trust structures
- Advising corporate trustees
- Working with tax accountants and tax lawyers with respect of a trust
- Advising trustees on issues relating to a trust
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Trusts
A trust is a legal arrangement in which a person or entity (the trustee) holds and manages assets on behalf of others (the beneficiaries). Trusts are often used to protect assets, manage wealth, or structure business operations. Trusts can be tailored to meet specific objectives, such as tax minimization, succession planning, or asset protection.
Advantages of Using Trusts
- Asset Protection - trusts that use a corporate trustee can provide access to limited liability and asset protection.
- Tax efficiency - properly structured trusts may offer tax benefits, such as CGT discount, and income being taxed at the hands of the beneficiaries instead of the trustee.
- Flexibility in distribution of trust income – for discretionary trusts, there is flexibility in distribution profits among beneficiaries of the trust.
- Succession planning - trusts help to facilitate smooth succession planning for families or businesses.
- Flexibility - Trusts can be tailored to meet specific needs and goals.
Disadvantages of Using Trusts
- Complexity - establishing and managing a trust requires careful legal and financial planning.
- Costs - setting up and maintaining a trust can involve significant expenses.
- Restrictions - Trusts may limit the control beneficiaries have over assets.
- Tax risks – changes made to the trust may trigger tax liability events.
The decision to use tax structure for managing your business or family income is an important one. Key factors to consider includes the needs of your business, future growth, asset protection needs and tax considerations.
Contact Us
At West Perth Legal, we deliver tailored legal solutions for both simple and complex tax structure. Whether you're managing personal wealth or running a business, our experienced team will work with you to design trust arrangements that align with your long-term goals.
Common Trust Structures We Assist With
A unit trust is a trust where the assets are divided into units, and beneficiaries (unit holders) receive distributions based on their units. This structure is often used for joint investments, real estate projects, or business ventures, as it provides transparency and clear ownership entitlements. Unit trusts are particularly advantageous for ensuring proportional returns and simplifying profit distribution.
At West Perth Legal, we assist in establishing and structuring unit trusts, preparing Unit Trust Agreement, Property Trust Unit Holder Agreement, and Shareholders Agreement for corporate trustees. We work with you to achieve your goals, protect the interests our client and help optimise the trust's functionality and tax efficiency.
A discretionary trust allows the trustee to decide how income and capital are distributed among beneficiaries, providing flexibility in managing assets and tax planning. This type of trust is frequently used for family wealth management, as it enables trustees to respond to changing circumstances or financial needs. Discretionary trusts can protect assets from creditors and ensure wealth is distributed strategically.
West Perth Legal can help you establish a discretionary trust tailored to your family's goals, ensuring it complies with legal requirements while maximising tax benefits, protecting assets, and creating a secure framework for managing and distributing wealth across generations.
A hybrid trust combines multiple types of trusts into one arrangement. Most commonly, combining a unit trusts and discretionary trusts, offering fixed entitlements to specific beneficiaries (like unit holders) while allowing the trustee discretion over other distributions. This structure is ideal for balancing the needs of both family members and business partners, making it useful for complex ownership structures. Hybrid trusts provide flexibility in income distribution while ensuring certain beneficiaries have guaranteed entitlements.
At West Perth Legal, assist with designing hybrid trusts that meet your unique needs, addressing tax implications, drafting trust terms, and ensuring the trust is legally sound to protect assets and support long-term financial goals.
A partnership of trusts involves two or more trusts collaborating as partners in a business venture. Each trust represents a distinct entity, such as a family or separate business, combining the benefits of partnerships with the asset protection and tax advantages of trusts. This structure is often used in complex business arrangements or joint ventures where multiple parties wish to retain control over their respective assets.
West Perth Legal provides guidance on setting up partnerships of trusts, drafting partnership agreements, and advising on exit strategies for partnerships of trusts.
Frequently Asked Questions
Commercial & Corporate Lawyers
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