In addition to changes we've previously outlined, the new Property Law Act, which came into force last week, introduced new provisions for the administration of trusts in Queensland, which will have a significant impact on how trusts are structured and managed.
The Act introduced an updated maximum perpetuity period (the "lifespan" of a trust), extending it from 80 years to 125 years. This change offers greater flexibility and longevity for trusts, which is great news for those planning for the future.
What's New?
If you are looking to establish a new trust - great!You will be able to adopt the new maximum perpetuity period upon establishment of the trust after 1 August 2025. If you have an existing trust that has not yet vested, then the key provisions which will apply are sections 216 and 217 of the new Act:
- Section 216: If your trust deed contains a power of variation which extends to variation of the "vesting date" of your trust, then the trustee can prepare a Deed of Variation implementing the new 125-year perpetuity period.
- Section 217: If your trust deed does not contain a power of variation which extends to variation of the "vesting date" of your trust, then the new 125-year perpetuity period can only be adopted if all of the beneficiaries under the trust are adults and of full capacity, and they unanimously agree to do so. Alternatively, you can apply to the Court to request an exercise of discretion to permit the change.
Why Does This Matter?
The extended perpetuity period is a game-changer for trusts,
especially for those focused on long-term goals like family wealth
preservation or charitable purposes. For new trusts, the process is
straightforward, but for existing trusts, we strongly recommend
that you consider reviewing your trust deed to see if you can take
advantage of this opportunity.
What Should You Do Next?
Please contact our Wills, Estates, Planning + Structuring Team to discuss how to go about taking full advantage of the opportunity to extend the vesting date of your trust.
We have packages available to review, and if possible, amend your trust. Whether you have questions about your own trusts or the trusts of your clients, please don't hesitate to call us to discuss.
For further information, contact Sheelagh Gray. The assistance of Patrick Gellatly, Lawyer, in researching this article is gratefully acknowledged.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
