Fletcher Law - Specialising in Trusts and Tax

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Evaluate Your Existing Trust

You can evaluate your existing trust online by using this specially designed form below.

Name of Trust:

Dated:

Fill out if applicable
Written Trust Deed?
Dated:

SECTION 1

The 3 certainties

	Intention - Is a clear intention to create a trust recorded in the Deed?
	Trust Fund - Is the property of the Trust (initial gift) clearly defined?
	Object - Are the beneficiaries (or purpose) of the trust clearly defined?

Validity of Trust

	Term - Is the trust established for a specific term?
	Is the term 80 years or less?
	If no specified term - does the trust wind up within 21 years of the date of death of a named person?
	Is the trust still current (within the term established)?
	Is there evidence that the original gift, to establish the trust, was actually made?
	Since establishing the trust has the Settlor remained financially solvent? (no claims from possible creditors)?
	Since establishing the trust has the Settlor's marriage status remained unchanged (no matrimonial property claims)?
	If any assets have been sold/transferred to the trust by the Settlor are those assets in the control of the Trustees (no longer the Settlor)?

Total - How many of the boxes above have been ticked?

If this number is less than 11 there is a fatal flaw to the trust and you should immediately seek advice from a specialist lawyer.

SECTION 2
Features of a quality trust

Tick if your Trust Deed has any of the following:

	Provision to vary the trust deed ?
	Ability to add or remove discretionary beneficiaries ?
	Clear definition of beneficiaries. Who receives the trust fund on the winding up date ?
	Settlor can be a beneficiary of the trust ?
	Provision to exclude Settlor as a beneficiary in the event of adverse financial or tax consequences ?
	Can the trustees resettle the trust ?
	Does the Settlor (or a family member) have the power to replace the trustees ?
	Do the trustees have to give consideration to the Settlors views if recorded in a "memorandum of wishes" ?
	Do the Trustees have the powers of a "natural person" ?
	Are the trustees exempted from the "prudent person" requirements for investment of the trust fund?
	Do the trustees have comprehensive limitation of liability and rights of indemnity ?
	Is the approval of an independent person required for distributions, to avoid adverse tax consequences?
	Can distributions be made to infant beneficiaries ?
	Can the trustees distribute income or capital or both to any discretionary beneficiary - as they see fit ?
	Are the trustees able to distribute to any beneficiary without having to consider the interests of all beneficiaries ?
	Is there provision to establish subtrusts on discretionary terms controlled by the trustees ?
	Do the discretionary beneficiaries include a company or another trust ?
	Can the trustees change the legal jurisdiction of the trust ?
	Is the trust fund internationally portable ?
	Is there a deeming provision for multiple settlements allowing the trustees to treat all settlements (gifts) received as being one fund ?
	Are there secrecy provisions in the Deed to limit information flow to beneficiaries ?
	Does the Deed record the reasons why the trust was set up ?
	Are there any directions in the Deed which would influence the way the Court can interpret the Deed ?
	Is the Deed easy to read and understand (plain English) ?
	Does the Deed clearly spell out the trustees obligations/duties ?

Total (number of boxes ticked).

If your total is less than 20 then you need to urgently see a specialist trust advisor if you wish to continue using your trust as part of your asset planning and protection strategy.

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