Testamentary trust preparation checklist
Testamentary trusts offer tax and asset protection benefits for beneficiaries. This checklist walks through the standard drafting steps for a discretionary testamentary trust will.
This is a 12-step checklist for drafting a testamentary trust will for an Australian testator. It covers the trust structure, beneficiaries, trustee powers, excepted trust income, and asset protection considerations.
The checklist
Confirm the testator objectives
Identify the testator's goals — tax efficiency for minors, asset protection, or control.
Assess asset base
Assess the asset base to confirm a testamentary trust is cost effective for the estate size.
Choose the trust structure
Choose between discretionary, fixed, or hybrid testamentary trust structures.
Identify primary beneficiary
Identify the primary beneficiary (often the adult child) who controls the trust.
Define the beneficiary class
Define the beneficiary class — spouses, children, grandchildren, and related entities.
Draft trustee powers
Draft wide trustee powers for investment, borrowing, distribution, and amendment.
Check excepted trust income
Structure distributions to capture excepted trust income treatment for minor beneficiaries.
Draft appointor provisions
Draft appointor provisions for controlling the trustee and succession of appointor role.
Consider vulnerable beneficiaries
Consider protective or special disability trust provisions for vulnerable beneficiaries.
Address family provision risk
Consider family provision risk and the treatment of ineligible beneficiaries.
Draft the will
Draft the will incorporating the testamentary trust provisions and any specific gifts.
Advise on administration
Provide written advice on trust administration, tax, and trustee record-keeping.
When this checklist applies
Use this checklist when advising a testator on a will with testamentary trust provisions, typically for substantial estates or tax-planning objectives.
Common pitfalls
- Using testamentary trusts for small estates where cost exceeds benefit
- Structures that do not attract excepted trust income treatment
- No succession plan for the appointor role
- Overlooking special disability trust options for vulnerable children
- Not explaining ongoing administration costs to the testator
Run this checklist on a real matter
Quillio drafts testamentary trust wills and explains the tax and asset protection implications. See /practice-areas/family-lawyers or start a free trial.
This checklist is a general guide. Testamentary trusts carry tax and administration complexity — confirm with a tax adviser before finalising.
Use this checklist on your matter.
Quillio can run this checklist on a specific NSW conveyancing matter — confirm each item, calculate adjustments, and generate the supporting documents. The free trial requires no credit card.
Start your free trial