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Description of this module
New legislation governing trusts and how they are administered has been in the pipeline since it was introduced in August 2017. The submission process is underway and at the end of 2018 the Justice Select Committee recommended that the legislation be passed.
It is expected that if enacted, the new Trusts Act will have a significant impact on the management and operation of trusts in New Zealand. It is possible that the new Act will come into force in around April 2019. There will be a transition period of 18 months from the date the Act comes into force to allow trustees to review their existing trusts before the Act becomes effective around October 2020.
The intention of the Trusts Bill is to make trust law more accessible to trustees and beneficiaries and to clarify the requirements on Trustees. It will also formalise trustee duties and best practice – increasing the expectations, time and costs for trustees in complying with the law.
More significantly there will be a new requirement for trustees to provide certain information to every beneficiary of a trust, including advising a beneficiary that they are a beneficiary and advising that they have the right to request information from the trustees. Trustees will need to provide beneficiaries with trust and trustee details as well as financial information regarding trust assets and liabilities. There will also be an obligation to advise all beneficiaries if there is a change of trustees. Before disclosing any information to beneficiaries, the Bill sets out 13 different factors to consider and allows trustees to refuse to provide trust information in certain circumstances.
While this legislation has not yet been finalised, should you wish to find out more or to commence a review of your Trust, please contact Mason Lockhart or Josh Muir at Lockhart Legal.
Get in touch for a free telephone consultation.