This is how to do it** - To disclose or not to disclose trusteeship?

The issue of whether the existence of a trust relationship should be disclosed to third parties, including banks and Titles Offices is one that comes up regularly.

The strict position from a trust law perspective is that the existence of a trust relationship does not need to be disclosed.

This said, there are a number of other factors that often need to be taken into account, including the following:

1. the Tax Office, in relation to superannuation funds, is of the view that the existence of a trust relationship should always be disclosed;
2. in some jurisdictions (New South Wales is a classic example), it is in fact not possible to disclose the existence of a trust on Titles Office records;
3. from an evidentiary perspective (for example, if the Tax Office is querying the way in which assets are held), it is often of significant benefit to have the trust arrangements supported by third party documentation;
4. where the trust instrument is lost, disclosing the trust and lodging a copy of it with a third party can often prevent significant costs and administrative difficulties that otherwise arise when a trust instrument cannot otherwise be located; and
5. finally, however, the non-disclosure of a trust relationship can be commercially important from a privacy perspective.

** for the trainspotters, the title here is riffed from the Katy Perry song ‘This is how we do’.