There are a lot of ways to lose money through business contracts, and stamp duties are a big factor. People lose huge amounts of money every year, and it is often due to the “traps” that they commonly fall victim to. One of these involves losing a business trust deed, and failing to follow the best course of actions to rectify the problem. If you want to try and avoid excessive fees, it pays to be aware of what to do. This article deals with some of the most common ways that people can deal with a lose business trust.
Losing Your Business Trust Deed
If the times comes when you want to make changes within your business, losting your trust deed can be a disaster. This includes if you must change your trustee, modify beneficiaries, sell assets or business, or carry out other dealings with the trust.
If You Have a Stamped Copy
If you have a copy of the trust deed that is stamped, you should be perfectly fine. For a nominal fee, you should be able to have a replica trust deed stamped. This is the best possible outcome in the above situation.
Unstamped, Unsigned, or Photocopied Trust Deed
But what if you are only able to find a copy of the trust deed that is not stamped or signed? This is not as desirable, but it can also work out well. You can lodge a statutory declaration with evidence of the trust’s “settlement sum”, at the time of declaration, along with your copy of the trust deed. There will be a penalty along with the duty for this, but it should not be overly expensive. Even if you are only able to locate a photocopy of the trust deed, you can stamp that in accordance to the Duties Act 1997 (NSW). Please be aware that if the trustee and settler sign this new copy of the trust deed, ad velorem stamp duties are likely to trigger.
What if You Have No Copy?
This is best avoided, but you still have a couple of safe choices in this situation. You can simply keep operating the trust under the Trustee Act 1925, with the limited power that allows. Alternatively, you can apply under the Trustee Act, section 81, to the Supreme Court and request a new trust to be put into place.
While the above options are the safest, there are other choices available. If all beneficiaries can agree to a change of rules within the trust, a new trust deed can be created. Of course, this means that you will need to identify every beneficiary of the trust. This can prove problematic when it is a discretionary trust. Consent will need to be forthcoming from person as well. Creating a new trust can also trigger ad valorem stamp duties. This is because you will need to acknowledge that the terms of the trust have been rewritten, essentially creating a new trust. So, it’s best to keep your business trust deed safe, and avoid possible stamp duties and expenses.