What's happening?
A testamentary trust is a trust established under a will, which comes into effect after death rather than during your lifetime. Rather than assets passing directly to a beneficiary, they can be held on trust, which may offer benefits such as asset protection or flexibility in how income is distributed among a family group.
What could it mean for me?
- A testamentary trust can offer a level of protection for a beneficiary's inheritance in some circumstances
- The suitability of a testamentary trust depends on personal, financial and family circumstances
- Additional administrative obligations can apply once a trust is established
- Tax outcomes for testamentary trusts can differ from other estate structures and should be discussed with your accountant
What are my options?
- Discuss whether a testamentary trust is appropriate for some or all beneficiaries
- Consider a discretionary testamentary trust for flexibility among a family group
- Obtain accounting advice alongside legal advice on structuring
What happens next?
- We discuss your family and financial circumstances
- We advise on whether a testamentary trust may be suitable for your will
- The trust terms are drafted as part of your will
- We explain how the trust would operate once activated
How can MGE Lawyers help?
We advise clients on whether a testamentary trust may suit their circumstances and, where appropriate, draft the trust terms as part of a broader estate plan.
We work alongside your accountant where tax considerations are relevant to the structure being proposed.