Annual Trust Requirements
Annual Review Process
Just as the administration of your Trust is vitally important, so is the Annual Review process that your Professional Trustee must now undertake.
Again, this is an absolute and if this review is not undertaken then the Trust risks being deemed non-compliant.
We certainly see now that there is an increased need for a disciplined, ordered and structured management process for all NZ Trusts. Additionally, excellent record keeping is essential if Trusts are to be deemed compliant and all of this can only be achieved if Annual Trustee meetings are held. This is why, with NZFTS, these meetings are mandatory, if you decide not to undertake this essential part of the entire Trust process, we will have no option but to retire you as a client. If you want a robust, compliant Trust, Annual Trust Meetings are an absolute.
Matters for review will include:
- What activity have the Trustees undertaken over the previous year?
- Has it been documented and approved?
- Does the Trust Deed give authority for the transactions?
- Is all this recorded by Trustees Minutes?
- What is the investment strategy for this Trust for the next 12 months?
- Has this strategy changed from last year?
- If so, do the Trust minutes reflect the new strategy?
- Have new assets been introduced to the Trust and if so, has this introduction of additional assets been recorded?
- Have there been any distributions throughout the year and have these been recorded?
- If funds have been distributed should they be recorded as a loan to the beneficiaries if the funds are to be repaid?
- Is the Memorandum of Wishes still accurate and reflective of your wishes right now? If not, these need to be amended immediately.
- Are inheritances expected in the future?
- Should these inheritances pass directly into your Trust or to you personally?
- Should inheritance Trusts for children be considered to help protect assets in the event of a marital separation, creditors claim or otherwise?
- What activities, if any, are proposed over the next year? Is there authority in the Trust Deed for this?
This list is by no means exhaustive; however, these Annual Trustee Meetings for your Trust should be an absolute necessity.