Old Wills Could Face New 30 Percent Trust Tax, Estate Lawyers Warn

Australia’s upcoming tax on family trusts, set to take effect from July 1, 2028, could affect existing wills drafted decades ago. Estate planning lawyers warn that over a million wills might require checking, with some potentially being unamendable. The proposed law mandates discretionary trusts to pay at least 30 percent tax on taxable income, with exemptions available.

• Australia’s proposed tax on family trusts could impact wills signed decades ago.
• The Society of Trust and Estate Practitioners (STEP) Australia estimates over a million wills may need to be checked.
• Some existing wills may become impossible to amend due to the new tax law.
• From July 1, 2028, discretionary trusts will be required to pay a minimum 30 percent tax on taxable income, subject to exemptions.
• Discretionary trusts allow trustees to decide income distribution among beneficiaries, typically family members.