The Trusts Act 2019, which came into force on 30 January 2021, is the first major trust law reform in New Zealand in 70 years. There are now greater compliance requirements for trusts, and all trustees are required to contact beneficiaries and supply them with basic trust information. This means that compliance duties will increase the time and cost of administering some trusts, and some will no longer be cost-effective. It also means that greater transparency will put things in the open that some trust owners might prefer to keep private.
These changes present a good opportunity for not-for-profits to create or improve their bequest programmes due to the fact that it is now more difficult to maintain a family trust. With an estimated 300,000-500,000 family trusts in New Zealand, and the cost benefit no longer being quite so favourable, trustees may find that allocating assets through Wills is a better (and less expensive) option.
Source: New Zealand Law Society, Public Trust
