Will amendments to update administrative terms of a trust (such as converting a unit trust to a fixed trust) trigger a resettlement for tax purposes?
The amendments set out in the deeds of variation we prepare generally should not amount to a tax resettlement of the underlying trust for tax purposes given the current approach of the Tax Office, as the variations are usually largely administrative in nature.
When more fundamental terms of the trust deed are amended, such as altering classes of beneficiaries, this may be more problematic from a tax resettlement perspective and specific advice should be obtained, before proceeding.
There may be other relevant factors for any specific trust we amend which may change the above comments and we can provide a proposed scope of work and fixed price to provide more detailed advice on a case by case basis, if requested.
The stamp duty consequences of any variation must also be considered, with different rules apply in each state.