Family Trust

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Family Trust refers to a discretionary trust set up to hold a family’s assets or to conduct a family business. Generally, they are established for asset protection or tax purpose.

 

Structure of Family Trust:

family trust map

1)Components of Family Trust

Appointor The appointor is the person with real control of the trust. The appointor has the power to hire and fire the trustee in his or her discretion. In most case, the appointor is one of the primary beneficiaries.
Trust Deed

 

The terms and conditions under which a family trust is established and maintained are set out in its deed. The trust is established by the trust’s settlor and trustee (or trustees) signing the trust deed, and the settlor giving the trust property to the trustee.
Trustee The trustee is responsible for the trust and its assets and has day to day control over the management of the trust. You can choose trustee to be more than one person, or you can choose to have a company act as trustee.
Beneficiary

 

Beneficiary can be categorised into two part: Primary Beneficiary vs General Beneficiary。
Primary beneficiary

Primary beneficiary has a closer nexus with family trust assets. Parent, children, grandchildren and other offspring can become primary beneficiaries.

General Beneficiary 

General beneficiary has a wider coverage, it could include the relative, spouse and siblings of the primary beneficiary as well as charity or entities such as companies or trusts that he or she owns or is also the beneficiary.

(2)The Advantages of Family Trust

1. Asset Protection Trust has become one of the most effective way to protect the asset.
Asset protection in terms of divorce

If there were potential issues with an in-law, the trust structure assists in potentially keeping the assets outside of the marital asset pool.

Asset protection in terms of bankruptcy

Under the protection of trust law, assets held by a person as trustee cannot be accessed by creditors if beneficiaries get into financial difficulty or even goes bankrupt, because assets owned are legally owned by trustee and not by beneficiaries.

2. Flexibility of Profit Distribution

 

Trust could achieve best result in terms of taxation planning by distributing profits/assets to beneficiary.

Trustee could distribute to any primary beneficiary or general beneficiary at his or her discretion.

3. Estate Planning The asset protection can continue the generations. Trustee can provide beneficiaries with inheriting and using assets through the management of trust deed.  Trustee can allocate the assets and return by using the trust deed. If anything happened to the appointor, the future generation cannot be fight for the estate.
4. Power of Trustee Trust can keep client’s information in a really secure way.  The information for established trust can be protected by the Australian Government, it will not be made to public. The original copy of trust deed will be kept by the accounting firm. According to the Australian Law, apart from the appointor or person holding a court issued document, no one else can access any information about the trust.

 

AP Financial Services Group has a highly qualified and knowledgeable team members. It can provide all information and services for accounting、law and financial issues. With the aim of providing a unique trust product for clients, AP Financial Services Group can help clients run their trust by acting in their best interests.  family trust people