Since coming into effect on 30 January 2021, the Trusts Act 2019 has impacted trustees and beneficiaries of trusts. The new Act provides for greater accessibility and offers trustees improved guidance to achieve this. Moreover, beneficiaries now have a better ability to hold trustees to account by ensuring that beneficiaries have enough information to enforce the terms of the trust.
Trustees now have a clear obligation to tell beneficiaries about the assets and investments contained within a trust.
A further issue is the extent to which many trust deeds provide for not just the children of the settlor but more remote categories such as charities and the de facto partners of the settlors’ children. These provisions were intended to ensure that there was a broad range of people or organisations who could benefit from the trust. Usually, however, those beneficiaries beyond close family will be oblivious to their mention in a trust deed. Against this, most modern trust deeds try and make sure that the only beneficiaries are the settlors’ children and grandchildren.
For this reason, it is often necessary to get legal advice about whether your trust deed is fit for purpose under the new Act. That advice can include taking the necessary steps to confine the beneficiaries of the trust to children and grandchildren and removing the more remote beneficiaries before they become entitled to such information.
For further advice and assistance with your trusts you can contact Kemp Barristers & Solicitors at info@kempsolicitors.co.nz or 09 412-6000.