CAN YOU TRUST YOUR TRUST DEED?

A Trust Deed is the constitutional and founding document of a trust. It is the written document according to which your trust was created and sets out the framework within which the trust is to operate. Trusts are often used as estate, business and succession planning tools and the benefits which flow from the proper use of trusts are plentiful.

However, one must ask, is your trust deed valid and up to date? Regrettably, many trust deeds are not.

It goes without saying that for your trust to function properly, it most definitely requires a valid and updated trust deed. A trust deed which is outdated, lacking and/or possibly invalid could result in unpleasant, lengthy and costly consequences.

Trusts are often also set up for charitable purposes and registered as Public Benefit Organisations with the South African Revenue Services. In order to enjoy the tax concessions afforded to a Public Benefit Organisation, the trust deed must contain certain provisions and comply with specific legislative requirements. Failure to do so may deter the fulfilment of the benevolent object for which the charitable trust was founded.

In light of the recent case law as well as amendments to and developments in legislation around the taxation and administration of trusts in South Africa, it is advisable to have your trust deed scrutinized by a professional. A legal audit of a trust deed is an affordable means of ensuring that your deed is up to date, valid and that its provisions promote the fulfilment of the trust purpose.

For more information contact Kelly Fourie-Barnard at office@rgprok.co.za or 044 601 9900.

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