There are dozens of types of trusts, and XETA works with all types.
It’s a separate legal entity established by law to be managed by a trustee for the benefit of the beneficiaries. You could set up a trust to manage your properties and investments for the future wellbeing of your family, or you could set up a business under the trust to manage a business and use the business to help your beneficiaries.
The trustee needs to be someone of integrity who can understand their trustee obligations, such as acting in good faith
A trustee of a trust doesn’t necessarily have to be a professional. The trustee needs to be someone of integrity who can understand their trustee obligations such as acting in good faith. They need to be able to carry out their duty to act in the best interest of beneficiaries – not themselves. Most of the time, the most suitable trustee structure for a trust will be a newly incorporated proprietary company (Pty Ltd). One or more individuals will be appointed as directors of the trustee company.
When you create a trust, it is important to consider who the ‘appointor’ of the trust is. An appointor (also sometimes called the principal) is defined as a person with the ultimate power to appoint and remove trustees.
Once the key decisions around selecting the trustee and appointor of the family trust is made, the next step is to draft the trust deed.
XETA provides trust set-up services for the standard types, and we have exclusive agreements with lawyers & solicitors in every state in Australia if you need to specialise and tailor your trust. We always recommend using our legal teams to consult, provide advice and oversee the trust establishment structure with our expert Tax Agents at XETA.
|State / Territory||Stamping Instructions and Costs|
|NSW||Needs to be stamped by a registered OSR lodger within 3 months from date of execution. $500 ($10 per additional stamped copy).|
|VIC||Needs to be stamped by a registered Duties Online Agent within 30 days from the date of execution. $200 (No charge for additional copies).|
|ACT||Stamping not required. Stamp duty is not payable.|
|QLD||Stamping not required. Stamp duty is not payable.|
|SA||Stamp duty is not payable, but deeds may still be stamped ‘exempt’.|
|WA||Stamping not required. Stamp duty is not payable.|
|NT||Stamping via NT Commission of Taxes within 60 days from the date of execution. $20 ($5 per additional copy).|
|TAS||Stamping by SRO Tasmania within 90 days from the date of execution. $50 (no charge for additional copies).|
Once the trust has been set up, XETA applies for the Australian Business Number (ABN) as well as the Tax File Number (TFN). This usually takes a couple of days. It can, however, take up to 28 days for the ABR to issue the ABN for a trust if they need to undertake any manual checks of the details provided as part of the registration.
We are often asked how to set up a trust account at a bank for a trust. A bank account should be opened in the name of the trustee (e.g. Trustee Company Pty Ltd) as trustee for the family trust.
A bank will typically require the ABN and TFN for the trust, as well as a copy or certified copy of the trust deed. In addition, a bank or other institution may also want to see a copy of the constitution, ASIC extract or Certificate of Incorporation for the trustee company.
The settlement sum should be the first deposit into the bank account of the trust.
An often overlooked aspect of setting up a family trust is choosing the correct bank account. Trustees of a trust need to ensure the main bank account is fit for purpose. They need to consider what it is going to be used for and who will need access.
For example, will it be used to execute investment purchases, or is it going to be a transacting account for a business? Does the bank account provide a data feed into the Trust’s online accounting software, such as Xero?
Once the bank account is set up and active, the family trust is officially operational and can receive additional capital via borrowings (including loans from beneficiaries), purchase investments and operate a business.
XETA helps you manage your trust’s compliance and regulatory activities to any level of detail you require. We make it easy for you.
Talk to our accounting & tax experts anytime you need!
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