When trust deeds or constitutions need changing
Sometimes trust deeds or company constitutions need to be changed. To ensure this is done correctly, you will need the help of an experienced lawyer.
Changing a trust
Changing a trust can be complex, and if it’s not done right, you could end up with tax problems.
To change the trust deed itself, you will need what’s called a deed of variation. If this is not handled correctly, you may end up “resettling” the trust, which means you have created a new trust out of the old one.
If you would like to change a trustee, you will need a trustee resolution, and a deed of variation. A change of trustee usually needs the permission of the person who established the trust in the first place.
If the trustee is a corporation, and not an individual, you will have to change the directors of that corporation. That means the existing directors will have to resign; the new directors must sign a “consent to act” form; and ASIC must be notified. The company’s director register will also need to be updated.
To add or remove a beneficiary to a trust, again, you will need a deed of variation.
Whatever changes you need to make to a trust, you should get specialist legal advice.
Changing a constitution
You can usually change a company’s constitution with a written, unanimous resolution of the shareholders. Or you can pass a special resolution, which will need at least 75 per cent shareholder approval.
Changing the constitution might involve adding new types of shares, or amendments to the original documents.
However, it is important to be aware of and follow the processes set out in your constitution, the Corporations Act, and your shareholders agreement. This will ensure that your new and updated constitution is valid and enforceable.
Whether you are making changes to a trust, or a constitution, it’s vital that every step is done correctly.
Get help from legal experts
The corporate law specialists at GLG Legal are here to help you. Contact our office on (07) 3161 9555 today for an appointment.