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Unit Trust

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How do I order a Unit Trust?

Need a Unit Trust? Simply fill in our form below. We will review all of your details and contact you with any questions. We will personally prepare your documents.

  • DIY Print: $330 (including GST)
  • Hard Copy: $385 (including GST)

*Prices do not include any stamp duty that may be payable.

Q & A Unit Trusts

The questions and answers below are for information purposes only and are not advice. You should arrange your own legal, accounting, financial and other advice.

1. What is a Unit Trust?

A Unit Trust is a trust under which the property of the trust is divided in to a number of units owned by unit holders (beneficiaries). Generally the unit holders are entitled to the income and capital of the trust in proportion to the number of units they hold. In this respect a unit trust is fixed and is distinguished from a discretionary trust in which the trustee can distribute the income and capital between beneficiaries in the trustee’s discretion. A unit is really just a means of describing the share in the trust fund to which the unit holder is entitled.

2. How is a Unit Trust established?

Our unit trust is established by subscription. The initial unit holders (subscribers) pay an amount to the trustee for the issue to them of units in a manner similar to shareholders subscribing for shares when a company is incorporated. There are therefore two parties to the unit trust, the trustee and the initial unit holders. The unit trust is created when the unit holders subscribe for their units in the trust.

3. How many Unit Holders?

There can be a maximum of 20 unit holders in our Unit Trust.

4. What is a Trustee?

The Trustee is the legal owner of all trust property (the unit holders are the beneficial owners). The Trustee administers the trust fund. 
The Trustee can be a company, one or more individuals, or a combination of them. It is generally preferable for different trusts to have different trustees.

5. What are the advantages of having a company as trustee of a Unit Trust?

The advantages of a corporate trustee include:
  • Companies don’t die!
  • Removal of most of the risk of personal liability which individual trustees are exposed to (although the directors of a corporate trustee may be personally liable in certain circumstances).
  • It is easier to effect a change in control of the trust (eg. transfer shares and change directors rather than remove and appoint an individual trustee).
  • No need to incur the cost of transferring assets to the new trustees or changing names on investments and bank accounts when there is a change in trustees.
  • Control of the fund is more certain in circumstances of death or incapacity of key persons.

6. What can I call the Trust?

You can choose any suitable name for the unit trust but avoid choosing names that suggest an inappropriate connection or affiliation with or endorsement by persons, organizations or governments with which you are not involved.

7. Does the trust deed have to be stamped?

A trust deed is usually subject to stamp duty. The amount of stamp duty payable varies between each State and Territory.
If your trust is to be governed by the law of South Australia the trust deed is generally exempt from stamp duty. For the Northern Territory, we give you the option on your order form of either arranging the stamping yourself or we can arrange stamping for you (at an additional cost). If your trust is to be governed by the law of any other State or Territory, you will need to contact the Stamp Duty Office in your State or Territory for information regarding duty payable on trust deeds.

What are some of the features of our Unit Trust package?

The following are some of the features of our Unit Trust package. However the trust deed should be read in full to understand the relationship between the trustee and unit holders and how the trust works.

  • All documents to establish the Unit Trust.
  • Our documents are easy to read and understand.
  • You decide how you want the documents delivered to you and therefore how much you pay.
  • We give you a choice of us arranging stamping of the deed (in SA or NT), or you can arrange it.
  • We prepare your documents and call you if we have any questions.
  • We can include your logo.
  • Fast delivery by e-mail or express post.
Show More features of this package
  • ability to make calls on units;
  • ability to issue units fully or partly paid;
  • discretionary units – ability to direct distribution on a discretionary basis;
  • new units must be offered to existing unit holders on a pro rata basis before they can be offered to others (unless all unit holders agree otherwise). The Trustee will set the issue price;
  • if a unit holder wants to transfer units they must be offered to existing unit holders first on a pro rata basis before they can be offered to others (unless to a related party or to a party as a result of the death of a unit holder). This procedure can be waived by all unit holders in writing;
  • ability to redeem units. The Trustee can redeem some or all of a unit holder’s units if requested and the trustee exercises it’s discretion to do so. Such units will be redeemed at their market value as determined by the Trustee (unless all of the unit holders provide their written consent otherwise);
  • individual or corporate trustee (and ability to change between the two);
  • broad trustee powers (although please note that the banks and other financial institutions are notorious for requiring very specific powers to be inserted in to trust deeds and they change their minds regularly and may insist on this despite the trustee having very broad powers under the deed);
  • detailed provisions for calling and conducting meetings of unit holders who generally have one vote per unit;
  • the trustee does not have an indemnity from the unit holders personally (only as against the trust fund) so that unit holders are protected to the greatest extent possible;
  • the trustee can issue units of different classes, although you should obtain professional advice before doing so;
  • Our standard unit trust will not be a ‘fixed unit trust’ for income tax purposes as a ‘fixed unit trust’ requires the issue of new units or the redemption of units to be valued in accordance with Australian accounting principles which is not a requirement of our standard trust deed. If you would like provisions to be included in your deed requiring the issue of new units or the redemption of units to be valued in accordance with Australian accounting principles please let us know. Please note however that the ATO’s view on what qualifies as a ‘fixed unit trust’ is not clear and we give no assurances as to whether any of our unit trust deeds will qualify as a ‘fixed trust’ for income tax purposes.

Document Shop Delivery Options?

*Prices are GST inclusive and do not include any stamp duty that may be payable.

DIY Print - $297

DIY Print – We will deliver all documents to you via e-mail.

Hard copy - $352

Hard copy – We will print, bind and deliver all documents to you in a binder via express post.

Stamping

SA: as from 1 July 2006, deeds are exempt from stamp duty in South Australia.
NT: $69

We will arrange stamping in the NT. Prices are GST inclusive. SA is exempt from stamp duty and NT price includes stamp duty of $25 (GST free).

What do I get if I order a UnitTrust?

You will receive:
  • Trust deed;
  • Requests for issue of units;
  • Trustee’s resolution (individual trustees) or minutes of meeting of the trustee company or sole director’s resolution (corporate trustee);
  • Register of Unit Holders;
  • Transfer Journal;
  • Unit certificates;
  • If you choose Hard Copy delivery a binder.

Disclaimer

You should not rely solely on the information in these questions and answers because they are of a general nature only and the tax and commercial laws apply differently to different people and circumstances. Also as the law changes constantly, there may have been changes to the law since these questions and answers were written. None of the information is intended to be legal, accounting, financial or other advice. You must not act on the information. You must seek your own legal, accounting, financial and other advice.
Document Shop Pty Ltd and it’s directors, officers, employees, agents, consultants and the author of these questions and answers expressly disclaim any and all liability to any person or entity for the consequence of anything done or omitted to be done by any such person or entity relying on a part or all of the contents of these questions and answers.

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Contact us

Phone: 1300 667 817

info@documentshop.com.au

PO Box 47 Highgate SA 5063

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Contact us

Phone: 1300 667 817

info@documentshop.com.au

PO Box 47 Highgate SA 5063