Trust deed reviews: what to check every 3 years
A 3-yearly trust deed review surfaces problems while they're cheap to fix. Here's the checklist.
Every 3 years, review your trust deed for: vesting date proximity, appointor succession, trustee continuity, beneficiary class changes, variation power, and tax law alignment. Most reviews surface one or two minor issues that are inexpensive to fix early.
Vesting date
The trust must wind up by its vesting date – often 80 years from creation, sometimes shorter. Approaching vesting forces a wind-up and distribution that triggers CGT. If vesting is within 10 years, consider whether to extend (where the deed permits).
Appointor succession
Has the appointor’s circumstances changed? Are they ageing? Is the named successor still appropriate? Many deeds only handle death of the appointor and miss incapacity. Address both.
Trustee continuity
If the trustee is a corporate trustee, are the directors current? Has the company been kept active and ASIC-compliant? If individual trustee, plans for succession on death or incapacity?
Beneficiary class
Does the beneficiary definition include everyone you want? Excluded categories (in-laws, future generations, charities) need explicit clauses. Family trust election restrictions matter here.
Variation power scope
Read the variation clause. Does it permit the changes you might want? If not, plan for either a deed of replacement or a workaround structure.
Tax law alignment
Trustee streaming clauses (post-Bamford), foreign beneficiary clauses, family trust election status, division 7A loan arrangements. All update over time and benefit from periodic check-ins.
Summary
A 3-yearly trust deed review surfaces problems while they’re cheap to fix. Here’s the checklist.
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If this article raised questions for your own circumstances, Sam Michele offers free 20-minute initial consultations. Learn more about our trust deed work, or book a consultation.
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Disclaimer: This article is general information only and does not constitute legal advice. Estate planning is deeply personal - every family's circumstances are different. For advice specific to your situation, please contact Rosewood Succession Solicitors.