Trust type

Fixed trust

A fixed trust is one where the beneficiaries, and their entitlements are easily identified. It is not a:

  • Unit trust,
  • Discretionary trust, or
  • Superannuation fund.

Unit trust

A unit trust is one where the beneficiaries hold units with specific rights to a proportion of trust income or assets, similar to shares in a company.

This means any arrangements made for the purpose, or having the effect, of providing, for persons having funds available for investment, facilities for the participation by them, as beneficiaries under a trust, in any profits, income or distribution of assets

Discretionary trust

A discretionary trust is a trust where some or all interests and or entitlements in the trust (including in the income or the capital of the trust) are dependent on a discretion, or the failure to exercise a discretion.  The trust may have a broad range of beneficiaries, or may have classes of beneficiary types.

Example 1 of a discretionary trust:

  • Under the Williams Family Trust, Mrs Williams has the discretion to decide who can receive any income or capital of the trust, and how much. If Mrs Williams does not exercise her discretion to distribute the income of the trust by 30 June of each year, then that income will automatically go to Ms Elise Williams.

Example 2 of a discretionary trust:

  • Under the Enterprise Trust, Trustee Pty Ltd has the discretion to decide who can receive any income or capital of the trust, and how much. 

On 29 June, Prof Bourke as director of Trustee Pty Ltd, decides to distribute 100% of that year’s income to Jonathon and to make a capital distribution to Anjelica.

Self-managed superannuation fund

Superannuation funds are a method of saving for retirement. A self-managed superannuation fund (SMSF) is a private superannuation fund that you manage yourself. It is regulated by the Australian Taxation Office (ATOThe fund must comply with specific legislative rules and requirements under s42 or 42A of the Superannuation Industry (Supervision) Act 1993.   A SMSF can have up to four members, and all members must be the trustees.

Superannuation fund

Superannuation funds are a method of saving for retirement. They must comply with specific legislative rules and requirements under s42 or 42A of the Superannuation Industry (Supervision) Act 1993.  Superannuation funds include:

  • Complying superannuation fund
  • Complying approved deposit fund
  • Pooled superannuation fund, or
  • Eligible rollover fund.

Public unit trust

A public unit trust is a type of unit trust:

  • The units of which are listed on the ASX or equivalent stock exchange, or
  • A trust with at least 300 registered unitholders, where no one unitholder (alone or with associated persons) holds or is entitled to more than 20% of the units.

Wholesale unit trust

A wholesale unit trust is a specific type of trust scheme which is registered as such by the Commissioner of State Revenue.