Trusts Act Update – core documents

The Trusts Act that came into effect in January 2021 is the first major reform since 1956.  New legislation has impacted trustees, beneficiaries, and legal practitioners, mainly for the better.

The Act aims to simplify the law and offers trustees improved guidance in order to achieve this. The new legislation also affords beneficiaries the ability to hold trustees to account by ensuring they have access to adequate information to enforce the terms of the trust.

Trustees are now able to retain core trust documents. Core trust documents are identified in the Act as:

• the trust deed and any other document that contains terms of the trust;
• any variations made to the terms of the trust;
• records of the trust property that identify assets, liabilities, income and expenses of the trust;
• records of trustee decisions;
• written contracts;
• accounting records and financial statements;
• documents of appointment, removal and discharge of trustees;
• memorandum of wishes; and
• any other documents necessary for the administration of the trust.

All trustees must keep a copy of the trust deed and any variations made to the terms of the trust. Any remaining documents can be kept by one clearly identified trustee. That trustee must make each document available to other trustees of the trust upon request.

A trustee must keep core trust documents for the duration of their trusteeship and if they cease to be a trustee, they must give any core trust documents to the new or continuing trustee of the trust.

Core trust documents can be held electronically however, Trustees should ensure that originals of all core trust documents are kept in a safe location.

We recommend that Trustees should seek to review what core documents they are holding and take steps to ensure they are compliant with the current legislation.

For more information contact our team who will be happy to assist you.