Professional Trustee Services for NZ Trust Advisers
The Changing Landscape for Trusts in NZ
The role of the Professional Trustee has always required robust, compliant systems and processes. Many Professional Advisers who have acted in this space have accepted the appointment as an ‘add on’ or a favour to their client.
As a result of the passing of the Trusts Act 2019, which comes into effect from 30 January 2021 many professionals are questioning whether they remain in the Trust Industry or exit, as the role and performance of the Professional Trustee will now be placed under the microscope.
This role has always required a disciplined approach, that should include as an absolute minimum the following:
- Robust Fact Find including all AML/CFT requirements
- Specific Engagement Letter detailing the services the Professional Trustee will offer, the costs associated with the establishment and on-going management of the Trust and the requirements on both the client and Professional Trustee from an administrative standpoint.
- Robust Trust Deed and Trust Supporting Documentation, including Trust Minutes for ALL Trustee’s decisions, which are recorded in ‘real time’ not 6-12 months following the decision. This should be contained in a Trust Minute Book and this should be held by both the Professional Trustee and the clients who also hold the position as Trustee.
- A mandatory Annual Trust Review service, which includes an Annual Trust Engagement Letter, Trust Minutes and a Total Trust Review process which is signed off by all Trustees.
These are just some of the services the Professional Trustee must undertake.
Our aim as Professional Trustee is to assist the entire Trust Industry, and not a specific entity or organisation, we are here to assist and provide services to both those who are looking to exit and those who wish to remain. Let’s face it, even if the number of Trusts in NZ were to fall by over 50%, there is still plenty of work for everyone who wishes to remain and be part of the solution for the Trust Industry as a whole.
Many of you who have acted as Professional Trustee, have also acted as Professional Adviser to the Trust, either in their capacity as Solicitor, Accountant or Financial Adviser. We at NZFTS have always taken the view that a Professional Trustee should only ‘wear one hat’, and hence at NZFTS, we will only act as your client’s Professional Trustee. All other services such as conveyancing, accountancy, financial advice will always remain with the existing Professional Adviser.
We believe very much in the pursuit of ‘the best practice’ approach, which is very much at the core of our vision. This ‘best practice’ approach should be measured by the quality and accuracy of the Trust’s initial and supporting documentation, the recording of Trustees decisions in ‘real time’, and the practical management of the Trust via the existence of a Trust Minute Book and an actual Annual Review process.
One of the new changes and challenges that Professional Trustees will face is the disclosure requirements to Beneficiaries and responding to information requests.
We see this as a positive not a negative.
Clients created their Trust for the protection of their wealth for their family!
We encourage transparency within the family and hence why we have created the ‘Family Office”, which sits alongside our FamilySecure offering.
This service encourages all family members to be invited to attend the Annual Trust Reviews. Note: we also encourage all Professional Advisers to also attend these meetings, as this provides clarity to the client and those professionals who are engaged to provide accurate advice to the Trust. This Family Office concept will allow the Settlors to convey to their family members why they have created their Trust, what their intentions are both now and in the future and how the introduction of Inheritance Trusts for each family member is of particular relevance and importance in their desire to protect the families wealth intergenerationally.
Like to know more?
If you’re a Professional Adviser and would like to have a confidential conversation with an experienced team who understand and can support you, feel free to call us. We’re here to collaboratively support you, your company, and your clients.