15/05/2026
⚠️ ESTATE PLANNING & FAMILY TRUSTS - WHY THE FEDERAL BUDGET MATTERS 👀
There has been increasing discussion following the Federal Budget about potential future tax changes affecting discretionary trusts and family trust structures.
Importantly:
➡️ these changes are NOT law yet
➡️ draft legislation is still awaited
➡️ there is still uncertainty about exactly how broad any reforms may be
One area many advisers are closely watching is the potential impact on:
• family trusts
• discretionary trusts
• estate planning structures
• testamentary trusts created under Wills
Many Australians use testamentary discretionary trusts in their Wills for legitimate reasons including:
✔️ protecting vulnerable beneficiaries
✔️ asset protection
✔️ tax planning for children
✔️ bloodline protection
✔️ safeguarding inheritances after death
The concern being raised is that if broad discretionary trust reforms are introduced in the future, there may be flow-on consequences for some testamentary trust structures as well.
At this stage, there is still uncertainty around:
⚠️ whether testamentary discretionary trusts would be carved out
⚠️ whether existing structures would be grandfathered
⚠️ how future tax treatment may operate
For now:
✔️ do not panic
✔️ do not rush to restructure
✔️ stay informed
✔️ review your estate planning and trust documents regularly
This is a developing area and one we will continue monitoring closely.
At Legato Law we assist with:
• Wills with testamentary trusts
• succession planning
• asset protection strategies
• estate planning for business owners and families
📍Joondalup, WA
🌐 www.legatolaw.com.au
Disclaimer: This post is general information only and does not constitute legal or financial advice. You should obtain advice specific to your circumstances before making any decisions.