If you are setting up a unit trust, entering into a joint venture, bringing in investors or reviewing an existing trust structure, our unit trust lawyers can help you get the structure right.
Our experienced business structure lawyers provide practical advice on unit trusts, unit trust deeds, corporate trustees, unitholders agreements, unit transfers, joint venture structures, trust deed reviews, restructuring and trust disputes.
A unit trust is a trust where beneficial ownership is divided into units. Each unitholder generally has an interest in the trust based on the number and class of units they hold.
For example, if two investors each hold 50% of the units in a unit trust, they will usually have fixed entitlements that reflect those interests, subject to the terms of the trust deed.
The trustee holds and manages the trust assets for the benefit of the unitholders. The trustee may be an individual, but it is common to use a corporate trustee for commercial, investment and joint venture structures.
A unit trust can provide more certainty than a discretionary trust where unrelated parties are investing together because ownership interests are fixed and identifiable.
A unit trust may be suitable where multiple parties want to invest, own assets or carry on a venture together through fixed ownership interests.
It may be appropriate where you want to:
However, a unit trust is not always the best structure. Depending on your circumstances, a company, discretionary trust, fixed trust or partnership may be more appropriate. There may also be tax, duty, land tax, asset protection and control issues to consider.
Revenue NSW explains that, for land tax purposes, a unit trust may be treated as a special trust, fixed trust or family unit trust depending on whether the relevant criteria are met. This is particularly important if the unit trust will hold land in New South Wales.
Our unit trust lawyers can help you decide whether a unit trust is suitable and how it should fit within your broader commercial structure.
For more detail, you can also read our pages on fixed unit trusts and How to Access the Land Tax Threshold in a Trust.
The key difference is how beneficiaries or unitholders benefit from the trust.
In a discretionary trust, the trustee usually has discretion to decide which beneficiaries receive income or capital, and in what amounts. This can provide flexibility, especially in family or asset protection structures.
In a unit trust, the unitholders generally have fixed interests based on the units they hold. This can provide greater certainty where unrelated parties are contributing money, owning assets or investing together.
A unit trust may be more appropriate where each party wants their interest to be clearly recorded. A discretionary trust may be more appropriate where flexibility and family wealth planning are more important.
We can help you compare both structures and decide which is more suitable for your business, investment or joint venture.
In many cases, yes.
A unit trust deed sets out the legal framework for the trust. However, a unitholders agreement can deal with the commercial relationship between unitholders in more detail.
A unitholders agreement can address:
Without a unitholders agreement, disputes can become harder to resolve, particularly where parties have different expectations about control, funding, profits, management or exit rights.
We can advise whether a unitholders agreement is required and prepare one that works with the unit trust deed.
A unit trust deed should be reviewed whenever the trust is being used for a significant transaction, investment, restructure or change in ownership.
You should consider reviewing your unit trust deed if:
Amending a unit trust deed requires care. The deed must allow the amendment, the correct process must be followed and potential tax or duty consequences should be considered before changes are made.
We can review your unit trust deed, identify key risks and advise on whether amendments are required.
Unit trusts are commonly used for business ventures, investments, property ownership and joint ventures. We assist with the establishment, review, variation, administration and dispute resolution of unit trust structures.
We can establish unit trusts and prepare the documents required to set them up properly. This may include the unit trust deed, trustee consents and initial unit issue documents.
We review unit trust deeds to ensure they reflect the intended structure, including reviewing distribution provisions and transfer restrictions.
We prepare and advise on deed variations where an existing unit trust needs to be updated, including changes to trustees, transfer provisions or voting arrangements.
We prepare and advise on the issue, transfer, redemption and restructuring of units, including unit transfer forms, unitholder approvals and sale documents.
We prepare and review unitholders agreements. These agreements are particularly important where unrelated parties are carrying on a venture together.
We advise on using unit trusts for property developments and investment arrangements, including structuring ownership interests and profit distributions.
A unit trust can be a strong structure for shared ownership, investment and commercial projects, but the details matter. Getting advice early helps ensure the unit trust is properly established, properly documented and aligned with the commercial relationship between the parties.
We help ensure each party’s ownership interests are properly documented. This gives unitholders greater certainty about their rights, entitlements and obligations.
We help document funding obligations, exit rights and dispute mechanisms. This protects investors and reduces the risk of future disagreement about money, control or returns.
We advise on trustee control, voting thresholds, approval rights and reserved matters. This reduces confusion about who can make decisions, incur liabilities, issue units or transfer units.
We advise on unit transfers, pre-emptive rights, buy-out processes and default events. This helps avoid uncertainty when a unitholder wants to leave, sell, retire or resolve a dispute.
We make the unit trust setup process simple and transparent. Here’s what to expect:
Call us on (02) 8287 3118 or email us at enquiries@axelegal.com.au to get started.
We will ask about the proposed venture, the parties involved, ownership percentages, funding arrangements, assets, trustee arrangements, tax advisers and whether you are setting up a new unit trust or reviewing an existing one.
During our initial consultation, we will outline our recommendations, explain the likely documents required and provide an estimate of costs.
We consider whether a unit trust is appropriate for your circumstances.
This may include advice about who should hold the units, whether there should be different classes of units, who should act as trustee, whether a corporate trustee should be used, how decisions will be made and whether a unitholders agreement is required.
We can also work with your accountant or tax adviser to ensure the structure is legally sound and commercially practical.
Once the structure is settled, we help prepare or review the documents required to establish or update the unit trust properly.
This may include the unit trust deed, corporate trustee documents, trustee consents, initial unit issue documents, unitholders agreement, trustee resolutions, unit transfer documents, deed variations and related commercial agreements.
We ensure the documents reflect the intended structure and are ready to be implemented.
After your unit trust is established, we can continue to assist as the venture changes.
We advise on unit transfers, new investors, deed amendments, trustee changes, unitholders agreements, joint venture issues, funding disputes, unit trust restructures and disputes between trustees or unitholders.
Our goal is to help your unit trust operate with clarity, certainty and proper legal foundations.
We’re here to structure
your trust properly
Our unit trust lawyers help you establish, review and amend unit trust structures with clarity, confidence and commercial purpose.
Our unit trust lawyers provide practical advice, tailored documents and commercially focused support for business owners, investors, trustees and unitholders.
We consider the commercial purpose of the unit trust before documents are prepared. This helps ensure the structure is fit for purpose from the beginning.
Unit trusts can involve technical legal and tax concepts, but the practical issues need to be understood clearly. We explain who controls the trust, how units work and where the risks are.
We prepare and review trust documents that reflect your actual arrangements. Proper documents reduce uncertainty and make future changes easier to manage.
We understand where unit trust disputes usually arise and draft with those risks in mind. We help put protections in place before the relationship breaks down.
