What is a testamentary trust Will?
A testamentary trusts is a trust created by a Will.
'Testamentary trust Wills' are Wills that include the provisions and terms that allow for beneficiaries to receive their inheritance in a testamentary trust.
Testamentary trusts are given special 'powers' under Australian law that can provide significant asset protection and tax advantages to beneficiaries who receive their inheritance in a testamentary trust.
Testamentary trusts are not complicated, or mysterious or difficult to understand.
Let's start from the beginning.
Australia has two types of Wills.
Basic Will kits from the Post Office and internet.
Or modern estate planning Wills that provide testamentary trusts - let’s just call them ‘Testamentary Trust Wills’.
Before Will Wizard, the only way to have a Testamentary Trust Will was to see a specialist lawyer in person which costs thousands.
So, is a basic or a testamentary trust Will right for you?
One the many differences is that Testamentary Trust Wills provide the option to inherit via a ‘testamentary trust’.
Testamentary trusts have special powers under Australian law and can act like your secure ‘personal bank’.
Let’s say you or your children inherit $500,000 via a basic Will.
Then some time later you or your children suffer a divorce, or suffer a bankruptcy, perhaps caused by a business failure, an economic downturn or addiction issues.
Basic Wills leave your inheritance unprotected & up for grabs in Family Court settlements or to pay debts.
…leaving you to watch your inheritance gobbled up by an ex, the courts and lawyers.
Had you inherited via a Testamentary Trust Will, and received your $500,000 inheritance in a testamentary trust, the Courts would almost certainly view your inheritance as protected and separate from any pool of money used to pay your debts or settlement.
Imagine the relief!
Another special power of testamentary trusts deals with tax.
In this example, let’s suppose you have three children but sadly your spouse passes away.
You inherit into a testamentary trust your spouse’s estate, valued at say $1,000,000, which you invest to earn 5% interest or $50,000 per year.
The ATO allows income earned on assets in a testamentary trust to be distributed to family members on lower tax rates.
You could distribute $18,200 tax free to each of your children to pay for their education and living expenses.
Over 10 years this could mean an extra half a million dollars for your family rather than the ATO!
Even better, testamentary trust protections can last for 80 years, and can be transferred across generations!
But the good news doesn’t stop there.
In the past you would need to pay an expert lawyer thousands for a Testamentary Trust Will.
Will Wizard now delivers affordable & verified Testamentary Trust Wills straight to your door.
Our simple form removes questions that don’t apply to you, takes minutes to complete, requires no financial details & we guide you each step of the way.
You can then relax as our legal experts prepare your Testamentary Trust Wills to be delivered in a secure zipper portfolio that also includes ten other important documents at no extra cost.
Our Wills rely on legal precedents that have been prepared by expert lawyers, and are valid across Australia.
Best of all, we provide free changes.
Thanks to Will Wizard, there is no reason to rely on a basic Will.
Don’t put it off any longer. Get started now
Try our guided form and tutorial. It's free and simple to try.
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.