The termination or more colloquially, winding up of a trust, is far simpler than the deregistration of a company. Nonetheless certain requirements must be met for the termination to occur.
A trust will cease to exist when:
- It has been wound up according to the trust deed
- Once it has reached the vesting date stipulated or the end of the perpetuity period (80 years)
- There ceases to be trust property
- All beneficiaries of legal age resolve to vest the trust in accordance with the rule in Saunders v Vautier
It is important that you take the following points into account:
- That you are following processes outlined in the trust deed
- That you have received consents from any necessary parties to the trust, i.e appointor/s
- You have advertised for those with a claim to trust property. In some cases a beneficiary's location may be unknown to a trustee, therefore the trustee needs to advertise to allow beneficiaries to present themselves.
- Identify beneficiaries and distribute all trust property
- Are there creditors?
- Capital Gains Tax and Stamp Duty may apply upon termination
- Cancellation of trust bank accounts