{"id":716,"date":"2020-12-22T14:48:45","date_gmt":"2020-12-22T04:48:45","guid":{"rendered":"http:\/\/nz.legalvision.com.au\/?p=716"},"modified":"2022-12-13T17:39:19","modified_gmt":"2022-12-13T04:39:19","slug":"change-discretionary-or-family-trust","status":"publish","type":"post","link":"https:\/\/legalvision.co.nz\/business-structures\/change-discretionary-or-family-trust\/","title":{"rendered":"Changing a Discretionary or Family Trust in NZ"},"content":{"rendered":"\n

In New Zealand, trusts can exist for up to 125 years. In this time, a lot of things can happen, and you may want to change your discretionary or family trust to reflect those changes. Depending on what you want to do, changing certain parts of a trust may end up creating an entirely new trust (which is called a \u2018resettlement\u2019) which may bring troublesome tax and administrative concerns. So, it is important to know what changes you can make to your trust so that it best serves your needs without triggering any issues. This article will outline some changes you can make and how you can do so.<\/span><\/p>\n\n\n\n

What Changes Can I Make?<\/span><\/h2>\n\n\n\n

Your first point of reference whenever you are dealing with a trust is to look at the trust deed.<\/a> At the time of its drafting, the settlor usually outlines how you are to deal with the trust. This includes making any changes. The trust deed will set out what powers the trustees have and who can appoint and remove trustees. Generally, changes to a trust fall into two categories:<\/span><\/p>\n\n\n\n

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  1. variations relating to trust property; and<\/span><\/li>\n\n\n\n
  2. variations relating to the administration of the trust.<\/span><\/li>\n<\/ol>\n\n\n\n

    Changes to the trust that are administrative in nature generally will not have any enduring tax consequences or be very difficult legally to implement. <\/span><\/p>\n\n\n\n

    For example, changing the name of the trust is not as momentous. But, any significant changes to the beneficiary\u2019s interest in the trust may have tax consequences, or amount to a resettlement of the trust into an entirely new trust.<\/span><\/p>\n\n\n\n

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    Therefore, it is important to get legal advice regarding these matters. You need to keep written records of any changes to your trust, including any deeds of variation so that you can refer to these records later if need be.<\/p>\n<\/div>\n\n\n\n

    How Can I Change My Trust?<\/span><\/h2>\n\n\n\n

    By Trust Deed<\/span><\/h3>\n\n\n\n

    This is where you follow what the original trust document says for implementing any change. Usually, there would be a clause in the deed outlining:<\/span><\/p>\n\n\n\n