Trusts

A unit trust is similar to a company, in that the unit holders (like shareholders) have a fixed interest in the capital and income of the trust. Just as shares are issued to shareholders in exchange for an appropriate sum of money, units are issued to unit holders.

A Farm Discretionary Trust is used where a family wishes to acquire land for primary production and to pass that land to other family members. A farm discretionary trust is usually set up for farm succession planning within a family.

A Class Discretionary Trust is best suited where a shorter term project is to be undertaken between people who have a stable and harmonious relationship.

A class unit trust is used when the rights between the unit holders are required to be different. The rights of a unit holder are primarily the right to vote, to receive income, to have their capital returned and/or to participate in the capital growth of the trust.

A hybrid unit trust is used when the persons to benefit from the trust include unitholders and/or legal entities which do not hold units (the beneficiaries).

Most limited recourse borrowing arrangements (LRBAs) by self-managed super fundsare established using a bare trust. Due to the complex nature of bare trusts, they are handled by our legal team at Docscentre Legal.