Many of you will have established Bare Trusts for your clients already this financial year. Bare Trusts are the simplest form of trust and a popular approach when it comes to managing assets, particularly through superannuation funds. We wanted to make it easy for you to quickly set up a Bare Trust online and get all the documents you need at once—so you can now do this through our CCASA Docs platform.
A Bare Trust (otherwise called a Simple Trust or Mandatory Trust) dictates that the beneficiaries have absolute rights to the assets of the trust as well as the income generated from those assets. The trustee actually has no control over the assets—they simply manage the trust responsibly and transfer the asset to the beneficiaries when asked to do so. It’s a sweet deal for the beneficiaries! A common reason for setting up a Bare Trust is when grandparents and parents want a tax-effective way to transfer assets to their grandchildren or children.
Bare Trusts are also required when an individual wants to borrow funds through their superannuation fund to acquire an asset. The rules around this specify that the asset acquired using limited recourse finance must be held in the name of a bare trustee on behalf of the fund as sole beneficial owner. Banks usually request that a superannuation fund borrower obtains and provides evidence that a Bare Trust Deed (sometimes known as a Declaration of Trust or Deed of Settlement) has been executed before the legal title to the asset is registered in the bare trustee’s name. The documents can be used for any asset that the fund is permitted to acquire under the superannuation legislation, such as real property, shares, units or other investments.
As part of the package, CCASA also supplies trustee resolutions for the bare trustee and the superannuation fund trustee as well as an overview document.
Contact Craig at firstname.lastname@example.org or Lisa at email@example.com if you’re not sure whether a Bare Trust is the right option for your client. If you’re ready to go, log in to our simple online ordering system and be amazed how quick and easy it is to have your Bare Trust package ready to go. Register here if you’re not already using CCASA Docs. Documents are generated based on the instructions received. We recommend you seek legal and/or accounting clarification on the documents and how they can be used in your circumstances.
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