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Navigating the intricate world of trusts in Australia can feel like navigating a maze, with one of the pivotal decisions being the choice between an Individual Trustee or a Corporate Trustee. The stakes are high, and making the wrong choice can have significant consequences. At Attune Advisory, we understand the complexities and pressures that small and medium-sized business owners can face, so below, we dissect the differences between a Corporate Trustee and anIndividual Trustee and shed light on why a Corporate Trustee could be a game-changer for your structure.
The Basics
To put it simply, an Individual Trustee is a person, while aCorporate Trustee is a company established specifically to act as a trustee.While both options have their merits, your choice should revolve around your long-term goals and the level of control you want to maintain. Discussing your long-term goals with our strategic advisors can make all the difference to how you create your structure.
Why It Matters
Your choice between a Corporate Trustee and an Individual Trustee has a profound impact on how you manage trust assets, personal liability, and even succession planning. Small oversights at this stage can lead to significant challenges in the future, making it a decision that should be carefully considered – and that’s where we can help.
Liability and Protection
A Corporate Trustee offers inherent limited liability. What does this mean for you? It creates a protective barrier between your trust's debts and your personal assets. Moreover, the corporate structure separates the legal ownership of trust assets from the beneficial ownership, safeguarding trust assets from your personal debts. In essence, it's a two-way protective shield, reducing risks and uncertainties.
Succession Planning
While no one enjoys contemplating it, succession planning is considerably more straightforward with a Corporate Trustee. Ownership can be transferred without altering the trust deed, ensuring a seamless process that saves you both time and money.
Individual trustees often necessitate separate asset titles foreach trust they oversee. In contrast, Corporate Trustees streamline this process, potentially saving you a substantial sum in stamp duty and other transactional costs over time.
What's the Initial Cost Comparison?
At first glance, creating an Individual Trustee may appear cheaper, but a Corporate Trustee often proves to be more cost-effective in the long run, considering the benefits it offers.
How Difficult is it toTransition from an Individual to a Corporate Trustee?
While it's possible, this transition involves paperwork, time, and financial expenses. It's usually advisable to make the right choice up front to avoid complications later – once again, it’s best to speak with the Attune team first up to help with making the right choice that suits your specific situation.
What About Tax Implications?
It's important to note that the structure of the trustee does not affect the tax paid by the trust beneficiaries.
We’re Your Path to aTrustworthy Trust
Are you ready to delve deeper into why a Corporate Trustee maybe the optimal choice for your trust structure? We're here to guide you every step of the way with tailored, strategic advice that works for you. You can book an appointment via email with the Attune team or reach out to us at 1300866 113.
