Australians can create a trust to hold assets and properties, and appoint a trustee who holds and manages it. The person appointed to hold this is known as the trustee. It can be created for people or companies, but it isn’t a separate legal entity the way a company is. However, the law treats it as such for registering taxes, which means the trustee is liable for debts. For this reason, many people choose a company as the trustee. A trust can be created during your lifetime or to take effect upon your death.

Key Responsibilities of a Trustee

The first responsibility of a trustee is asset management. Their primary role is managing a trust’s estate, and this includes real estate, investments, and assets. They are charged with ensuring taxes are paid accordingly, protecting assets, and making sound investments. 

The second responsibility is properly distributing the income and principal to listed beneficiaries. A trust should have specific details acknowledging who receives what, and it’s up to the trustee to ensure it’s followed to the letter, which may mean holding assets for distribution at another time, making regular payments to certain beneficiaries, or waiting for specific times to distribute assets. For example, many trusts will place an age restriction on payments. 

Every trustee has a fiduciary duty to the trust and its beneficiaries. They are charged with always acting in the beneficiaries’ best interests to make decisions prudently, exercise due diligence, and avoid any conflicts of interest. 

The trustee also has administrative duties, including filing tax returns and maintaining accurate records. They must follow regulatory requirements and comply with the law in every instance. In some cases, a trustee will need to make decisions for the beneficiaries, whether it’s related to educational or living expenses or approving medical treatments.

Choosing the Right Trustee 

Choosing the right trustee is a crucial part of the decision-making process, so when you are thinking about who you should appoint, we encourage you to consider the following: 

  • A trustee has to be trustworthy and reliable; you need someone who will always act honestly and serve the beneficiaries’ best interests. 
  • A trustee should have some type of financial expertise, especially if there are significant assets in the trust. 
  • The chosen trustee should have at least a basic understanding of estate law to ensure they don’t run afoul of the law or regulations. 
  • Communication is an important skill for a trustee, as they must regularly communicate with beneficiaries to inform them of the trust’s performance. 

The role requires a lot of time and effort, so the trustee you choose must be able to commit the necessary time to their duties. 

Professional Trustee Services 

Serving as a trustee is a big commitment and many people shy away from that level of responsibility, which is why there are professional trustee services. A professional trustee has the financial acumen necessary to execute the trust, and the legal understanding of estate law, and will be dedicated to managing your trust’s assets. 

Before you decide what move to make, you should sit down and discuss it with your will and estate lawyers. They can advise you on the best course of action. There are costs associated with using a professional trustee service, and it’s important that you weigh those costs against the benefits. It means you can rest easy knowing your trust will be administered properly, but is that enough to go down the professional route? 

Trustees should always review a trust agreement’s terms to understand what a trustee’s specific responsibilities and duties entail. They will also need to stay up-to-date with changes in tax regulations or estate law, which can be a daunting prospect. 

Whether you choose a professional trustee or someone else, you should choose carefully because you need to know your assets are in good hands. 

Many people choose the same executor to serve as a trustee, but these can be separate people or companies. If the trust is established in a will, the trustee’s role begins when the executor completes their duties. The trustee then assumes legal ownership of the trust’s assets and must manage them in line with the terms of the trust. 

How AJB Stevens Can Help 

If you’re thinking about creating a trust, you should speak to an experienced will and estate lawyer to discuss your options. The process can be complicated if there are will disputes that hold up the estate settlement and deceased estate lawyers’ costs add up quickly. You don’t want a will estate dispute to eat away at your estate or have family members hiring estate litigation lawyers to tear your wishes apart. Your will must be clear so that trust can kick in as you wish. 

Are you considering contesting a will because you believe you were unfairly treated or left out by mistake? 

Are you worried that someone took advantage of your loved one and you’re thinking about challenging a will? 

AJB Stevens can help you fight to get what you are entitled to, whether dealing with an invalid will or unfair treatment.