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  • Writer's pictureTim Purcell, Founder

What are the tax rates on testamentary trusts? What is the capital gains tax rate on a trust?

The income tax rates on income earned from assets in a testamentary trust are the same as personal income tax rates.

However the ATO allows income earned from assets in a testamentary trust to be distributed to family members on lower tax rates.

This provides valuable opportunities to potentially save hundreds of thousands of dollars income tax over time. View our case study here.

Capital Gains Tax is not triggered when an asset belonging to you passes via your Will to the executor or the trustee of a testamentary trust. Furthermore, there is no Capital Gains Tax when your assets are transferred from the trustee of a testamentary trust to a beneficiary.

The trustee of a testamentary trust can select which of the beneficiaries of the testamentary trust should take the capital gain such as a beneficiary on a low or nil income.

This strategy allows the capital gains tax liability to be significantly reduced over time.

Holding inherited assets within a Will Wizard testamentary trust offers beneficiaries an opportunity to defer the need for the sale of assets (and therefore capital gains tax) until later when more numerous beneficiaries come into existence. Tax deferred is tax saved.

At Will Wizard we believe that every Will should provide beneficiaries with the option to receive their inheritance in a testamentary trust.

Will Wizard is the only online Will that provides testamentary trust provisions as standard, including broad trust terms for maximum flexibility in how a beneficiary can manage their trust depending on their changing needs and circumstances. No meetings are required, you simply complete our fun an easy online form that requires no financial details, and we then courier your secure Wills to your door for signature on delivery at no extra charge.

We've taken the hassle out of having comprehensive testamentary trust Wills.

Don’t put it off any longer. Get started now

Try our guided form and tutorial. It's free and simple to try.

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If you have a specific question please submit a ticket or request a call-back :)

We’d love to hear from you.

Will Wizard Co-Founder

As always, if you have questions about the suitability of any Will for your needs and circumstances, seek independent legal advice.



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