New Act for family trusts

Anew trusts Act is now governing the setting up and the administration of family trusts in New Zealand. The new Act has come into being in an attempt by our lawmakers to give more rights to possible beneficiaries of trusts and to increase the duties of trustees of trusts.

Whilst it is important to fulfil the prescribed duties set out for trustees by law, often this will mean that very little has changed for prudent trustees of trusts. The management of entities such as partnerships, companies and trusts have always been regulated by law and should be performed properly and professionally without any doubt.

When settlors of trusts have made the required variations and applied the variations to their deeds of trust it will mean that the trustees will be able to run their trusts as they did before.

Trustees of trusts which are adapted according to the new Act will be able to invest as before, make decisions as they personally believe are prudent for the beneficiaries, and will also continue to benefit themselves.

It is the independent trustees who are increasingly finding themselves under more scrutiny, and laden with heavier duties than ever before. The settlors of most trusts are in a different position as they are part of the family and therefore closer to the beneficiaries than the other trustee.

This different relationship gives them more freedom to act than the other trustees.

In the next few articles, I would like to explain how trusts should be adapted under the new Act and how people who have set up their trusts can continue to run them for themselves and their family members.

If you have any questions or if you would like more information on these issues then please give me a call at 021 830308 or email me at kingfishertrustlaw@gmail.com with your query or book in to see me at kingfishertrustlaw.co.nz