If you are setting up a fixed unit trust, acquiring property through a trust, or reviewing an existing unit trust deed, our fixed unit trust lawyers can help you get the structure right.
Our experienced business structure lawyers provide practical advice on fixed unit trusts, fixed trust deeds, corporate trustees, unitholders agreements, unit transfers, deed reviews, deed variations, conversions of existing unit trusts and land tax issues.
A fixed unit trust is a unit trust where the unitholders have fixed and clearly defined rights under the trust deed.
Those rights usually include fixed rights to income and capital in proportion to the units held by each unitholder.
This is different from many ordinary unit trust deeds, which may give the trustee broader discretion over income, capital, unit classes or amendments. Those provisions may be useful in some structures, but they can create problems where the trust is intended to qualify as a fixed unit trust for NSW land tax purposes.
For property investors, the distinction is important because a fixed unit trust may be eligible for the land tax threshold, provided the deed satisfies the relevant requirements.
For many property investors, the main reason for using a fixed unit trust is to access the land tax threshold.
Revenue NSW explains that fixed trusts are eligible for the land tax threshold, while special trusts generally do not receive the benefit of the threshold.
This can make the structure particularly relevant where:
However, the trust does not qualify merely because it is called a fixed unit trust. The operative provisions of the deed must support that outcome.
For a more detailed explanation of threshold eligibility, you can read our article on How to Access the Land Tax Threshold in a Trust.
We can review your existing deed and advise whether it appears to satisfy the fixed unit trust requirements, or whether amendments should be considered.
If you are acquiring property through a trust, it is important to consider the fixed unit trust requirements before the property is acquired.
We can prepare a fixed unit trust deed designed for property ownership and land tax purposes. This may include:
We also consider who should hold the units, whether a corporate trustee should be used, how decisions will be made, how units can be transferred, and whether a unitholders agreement is required.
Many clients already have a unit trust, but the deed may not have been prepared with land tax fixed trust requirements in mind.
Revenue NSW has published guidance on unit trust deed amendments for land tax purposes, including the types of amendments that may be accepted for a unit trust to receive the benefit of the land tax threshold.
For a broader explanation of how fixed trusts operate and why they are commonly used for NSW land tax purposes, you can also read our Guide to Setting up a Fixed Trust.
We assist with reviewing and amending existing unit trust deeds where clients want the trust to operate as a fixed unit trust.
This may involve reviewing and, where appropriate, amending provisions dealing with:
Care must be taken before making any amendment. The deed must allow the amendment, the correct process must be followed, and potential tax, duty, resettlement and commercial issues should be considered.
Fixed unit trusts are commonly used for property ownership where land tax threshold access is an important consideration. We assist with establishment, deed review, deed variation, conversion and ongoing administration of fixed unit trust structures.
We prepare fixed unit trust deeds and establishment documents with land tax considerations in mind for clients acquiring property through a trust structure.
We review existing unit trust deeds to assess whether they appear to operate as fixed unit trusts and whether they can be amended so as to convert them into a fixed trust.
We prepare deed variations where an existing unit trust needs to be amended so that it is intended to operate as a fixed unit trust.
We prepare and advise on the issue, transfer, redemption and restructuring of units, including unit transfer forms and unitholder approvals.
We advise on whether a fixed unit trust deed is suitable for land tax purposes, including identifying provisions that need to be amended.
We advise on restructuring existing unit trust arrangements where the current deed or ownership structure no longer reflects the intended commercial or land tax position.
A fixed unit trust can be a useful structure for NSW property ownership, but the deed needs to be carefully drafted. Getting advice early helps ensure the trust is properly established, properly documented and intended to qualify for the land tax threshold.
We draft and review fixed unit trust deeds with land tax treatment in mind. This includes considering whether the deed supports fixed trust treatment.
A fixed unit trust should clearly define each unitholder’s rights to income and capital. We help ensure the deed properly records those rights and avoids unnecessary trustee discretions.
The deed must do more than describe the trust as fixed. We review the operative provisions, including distribution clauses, capital clauses, amendment powers and winding up provisions.
If your existing unit trust may not qualify as a fixed trust, we can advise on whether the deed can be amended and prepare the required variation documents.
We make the fixed 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 whether you are setting up a new trust, reviewing an existing trust deed, acquiring property, already paying land tax, or seeking to amend an existing unit trust.
During our initial consultation, we will outline our recommendations, explain the likely documents required and provide an estimate of costs.
We consider whether a fixed unit trust is appropriate for your circumstances.
This may include advice about who should hold the units, who should act as trustee, whether a corporate trustee should be used and more.
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 fixed unit trust properly.
This may include the fixed unit trust deed, corporate trustee documents, trustee consents, initial unit issue documents, 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 fixed unit trust is established, we can continue to assist.
We advise on unit transfers, deed amendments, trustee changes, unit trust restructures and disputes between trustees or unitholders.
Our goal is to help your fixed unit trust operate with clarity, certainty and proper legal foundations.
We’re here to structure
your trust properly
Our fixed unit trust lawyers help clients establish new fixed unit trusts, review existing unit trust deeds and convert unit trusts where appropriate.
Our fixed unit trust lawyers provide practical advice, tailored documents and commercially focused support for investors, trustees and unitholders.
We explain whether your unit trust deed is likely to operate as a fixed unit trust, what the key deed provisions mean, and what changes may be required.
We help ensure the structure is not just legally prepared, but ready to use. This may include trustee resolutions, unit issue documents and corporate trustee documents.
We prepare and review fixed unit trust deeds with the land tax threshold in mind. This includes considering whether the trust is structured to operate as intended for land tax purposes.
If an existing unit trust needs to be updated, we can advise on whether it can be amended and prepare the required deed variation documents.
