Wellington Lawyers: Is Your Family Trust Still Fit for Purpose? How the Trusts Act 2019 Impacts NZ Families
Family trusts once protected assets for many Kiwi families, farmers, and business owners. But are they still effective under the Trusts Act 2019? Learn when to review or wind up your trust.
Is Your Family Trust Still Fit for Purpose?
Family trusts have been a cornerstone of asset protection and succession planning in New Zealand, particularly for farmers, small business owners, and families wanting to safeguard wealth. A trust can shield property from business risks, relationship property claims, or even future tax implications.
However, just because a trust was set up 10 or 20 years ago doesn’t mean it’s still right for you today. With the Trusts Act 2019, closer scrutiny from the IRD, and changing family dynamics, now is the time to review whether your trust is still serving its purpose.
Why Your Trust May Need a Health Check
-
The Law Has Changed
The Trusts Act 2019 introduced new obligations for trustees, including stricter rules around record-keeping, beneficiary communication, and decision-making. Many older trusts don’t comply with these requirements, leaving trustees personally exposed. -
Your Family Situation Has Evolved
Divorce, remarriage, blended families, or children entering new relationships can all undermine the original intentions of your trust. What once worked may now leave your assets vulnerable or your wishes unclear. -
You May Be Paying for Something You Don’t Need
Trusts incur annual compliance costs—legal reviews, accounting fees, and sometimes independent trustee expenses. If your trust no longer provides real protection, these costs may outweigh the benefits. -
Succession Planning May Be Outdated
Does your trust reflect your current wishes for inheritance and control? Are the right trustees in place? As children grow older or family members change, your trust may need to evolve too.
Key Questions to Ask Yourself
-
Why did I set up the trust originally?
-
Are those reasons still relevant today?
-
Do I understand trustee obligations under the new law?
-
Is the trust still protecting what it should?
What You Can Do
We recommend reviewing your trust every 2–3 years or after major life events. A trust review can ensure that:
-
The trust aligns with your current goals.
-
Trustees understand and meet their legal obligations.
-
Beneficiaries’ interests are properly managed.
-
Your trust is still worth the cost of maintaining.
If the trust no longer serves a purpose, winding it up may be the best option.
???? Learn more about Wills & Trusts at Core Legal
???? Explore our Estate Planning Services
???? Book a trust review consultation with our Masterton or Wellington office.
Frequently Asked Questions (FAQs)
How often should I review my family trust?
Every 2–3 years, or whenever there are significant legal or personal changes such as marriage, divorce, or succession planning needs.
What happens if my trust doesn’t comply with the Trusts Act 2019?
Trustees may face personal liability for failing to meet their obligations. A legal review can ensure compliance.
Can a family trust be wound up?
Yes. If a trust is no longer effective or necessary, it may be wound up with proper legal advice and planning.
Does a trust still protect against relationship property claims?
In some cases, yes. However, poorly managed or outdated trusts may not provide the protection you expect.
Who should I talk to about reviewing my trust?
An experienced trust lawyer can assess whether your trust is still effective and advise whether to amend, restructure, or wind it up.
Need a bit of legal assistance? Contact a Corelegal team member today and learn more about our legal services. You won’t regret it.
Aside from family law, we are commercial lawyers Wellington who offer legal services to help you.
You can click here to speak to a commercial lawyer and family law firm. We will give you a call to know more about your needs. We will explain to you how we can improve your affairs.
Contact
Lawyer Masterton | Commercial Lawyer Wellington | Asset Planning Lawyer | Wellington Property Lawyer | Wellington Relationship | Property Lawyer
Address: Level 1,
109 Chapel Street,
Masterton 5840
Phone: +64 800 778 952
