Beware Inheritance Trusts

Monday 1 April 2013, 3:05PM
By Andersen Accountants Limited

The Public Trust offers a product called an “Inheritance Trust”. You set up a trust during your lifetime but property doesn’t get transferred to your trust until after your death.  The Public Trust says that, “An inheritance trust will help your beneficiary enjoy what you leave them, no matter what the future holds.” We consider that this statement may be misleading.

Property that you leave in your will (whether to a trust or anyone else) can be claimed by a surviving spouse or de factor partner. Anyone who feels that they have not been left what they should have (children and others) can take a Family Protection Act claim against your estate. The end result after these common claims is that very little may be left over for transfer to the inheritance trust. It is far safer to transfer property to a trust during your lifetime. If done correctly there is little likelihood of a claim after your death. If you are seeking to ensure that your beneficiary will really get to enjoy what you leave them, the answer is not an inheritance trust.

Andersen Accountants Limited provides expertise in trust creation and management. Please contact us if you have any questions.

Kristina Andersen
Andersen Accountants Limited
Telephone: 09 3695198