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  1. #11

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    Thanks all for your replies. I guess it depends a lot on what you use the Trust for. Mine's purely for asset protection to be honest, so I'm probably exactly the sort of person they're aiming to get rid of with this updated legislation. Well, they won, I'm winding it up!

  2. #12
    Join Date
    Sep 2004
    Location
    Hastings
    Posts
    15,078

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    Quote Originally Posted by apartmental View Post
    Mine's purely for asset protection to be honest, so I'm probably exactly the sort of person they're aiming to get rid of with this updated legislation. Well, they won, I'm winding it up!
    Why do you say that?

    There's the usual scaremongering in the report:

    "In many situations, trustees comprise mum and dad and a friend as the independent trustee, sitting around the kitchen table, signing off the annual accounts and creating a set of minutes. Now, as a trustee, you will be judged against industry experts, who are professionals. You will be expected to perform to the same standard as an expert and, if you are found wanting, the repercussions could be serious. Going one step further, those trustees who have not engaged an investment professional to assist with investment decisions, but have taken on that responsibility themselves, run the most risk.
    No mention of the likely hefty fees charged by "industry expert professionals," versus the mostly fee-free honorary status of the kitchen round table crowd. The fees of the 'experts' could well consume any improved financial return on 'investments,' so the beneficiaries would be no better off.
    Want a great looking concrete swimming pool in Hawke's Bay? Designer Pools will do the job for you!

  3. #13

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    Quote Originally Posted by Perry View Post
    Why do you say that?
    Some would argue there's a certain "shamminess" (is that a word) to Trusts with a settlor who is also a trustee and a beneficiary, with a token corporate trustee to rubberstamp decisions...when all the time it's the settlor who's really making the decisions and still kinda sees the Trust assets as their own.

    I suspect the new legislation will weed out many more of these.

  4. #14
    Join Date
    Sep 2004
    Location
    Hastings
    Posts
    15,078

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    Quote Originally Posted by apartmental View Post
    Some would argue there's a certain "shamminess" (is that a word) to Trusts with a settlor who is also a trustee and a beneficiary
    If you think about it, it is 'normal' for a Trustee to be a final & discretionary beneficiary.

    The 'settlor' problem was one created by legislation, in the first place.

    I settled a Trust for my son. (I was the settlor.)
    He placed his property in the Trust.
    Thereby he also becomes a settlor.
    (No matter that he did not intend that.)
    Want a great looking concrete swimming pool in Hawke's Bay? Designer Pools will do the job for you!

  5. #15
    Join Date
    Feb 2013
    Posts
    364

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    Quote Originally Posted by Anthonyacat View Post
    Trusts still offer significant tax benefits in some circumstances - those with kids in their late teens, or an unemployed spouse or other close relative.
    Depends if the setup costs + depreciation recovered + ongoing costs is less than the tax benefits.
    So eg setup 5k for LTC Trust and PPOR
    5K depr recovered. 10K
    Of course you cant distribute all the trust income to a 19 year old, they still owe this!
    Then they start working so not much benefits. Good if Spouse not working then can distribute the lot.
    Trust is ideal for business which carries inherent risk.

  6. #16
    Join Date
    Mar 2015
    Location
    Brisbane Wellington Auckland
    Posts
    846

    Default

    Do you know how other trusts have been able to extend beyond the 80 years ?
    It would be nice to set up a trust that extends to the length of many of the property leases and being able prohibit the sale of the properties.


 

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