This will come down to your personal circumstances. Individual trustees are cheaper and easier to start out with, but they can make things more complicated down the track. The drawbacks of individual trustees are:

  • Liability - The trustee acts on behalf of the trust and manages it. If something goes wrong the individual trustee may be liable.
  • Clarity - The trustee is the legal owner of any property belonging to the trust. If the trustee ever gets into financial troubles it can be difficult to distinguish between assets held personally and those held for the trust.
  • Administration - If the trustee ever changes or dies then it can cause major headaches. The legal title of all assets would have to be changes and it can cause other administrative problems.

A company costs around $500 to register and annual fees of around $250 are due every year. However using a company as trustee removes all the issues with individual trustees. Directors and shareholders in the company have the benefit of limited liability, if the sole duty of the company is to be trustee then there is clarity of asset ownership, and it is easy to change the directors of the company without changing the legal title of assets.

Taking this into account it is generally recommended that a corporate trustee is used. If you are in doubt you should seek professional advice from your accountant or lawyer.


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