Purpose of a minor trust
The purpose of a minor trust is to manage and protect assets for a child until they reach a specific age. Some minor trusts provide funds for a child during their childhood, while others don’t provide any funds until they reach adulthood.
The duration of a minor trust depends on the document that governs the trust. Most minor trusts come to an end when the child reaches a specific age. This is usually at 18, 21 or 25 years.
Our role as a trustee
As trustee, our role is to promote the child’s rights, interests and opportunities. We do this by taking responsibility for managing and preserving the money in the trust for their future needs and ensuring funds are only used for their direct benefit.
For more information about our role as a trustee, we have the following guide to download.
How Queensland Public Trustee is appointed as trustee
Every trust has a legal document that authorises a nominated person or company to act as trustee of the funds. Queensland Public Trustee may be appointed to act as trustee for a minor trust under the following circumstances:
- By the terms of a Will is when a minor is named a beneficiary of a trust and Queensland Public Trustee is named as the trustee.
- By the Supreme Court is when a minor receives damages for personal injury in a court case and the funds are to be held in trust.
- By legislation is when a minor receives financial compensation as a victim of an accident or crime and the funds are to be held in trust. Also, when a minor is beneficiary of superannuation payments from a deceased parent.
How we administer a minor trust
You should note the following information is an overview about how we manage a minor trust. All trusts are different and some of the information may vary depending on your individual circumstances.
For a minor trust we interact with the legal parent or guardian as the primary contact until the beneficiary turns 18. This is because a child doesn't legally have full capacity to deal with their own legal and financial affairs until they reach adulthood.
To identify and protect trust assets and distribute income and assets under the rules of the trust, we take the following steps.
1. We develop an annual budget and financial plan
We develop an annual budget and financial plan. We seek your views, wishes and preferences about how we manage the investment, including ways we can maximise benefits for the child’s current and future needs.
2. We manage and invest funds
We place the funds in the most suitable investment option according to the goals of the financial plan. We review the interest rates on the investments and adjust them annually according to what is happening in the broader financial market.
Around half of the Minor trusts we administer have assets under $10,000. For small trusts such as these, our objective is to invest the funds in low-risk options to protect and maintain the asset for the child’s benefit. For trusts with more sizable funds and a longer trust term, we can investigate a broader range of options that may help achieve higher returns.
Learn more about how we manage investments.
3. We provide financial records
We provide an annual statement that details our fees to manage the trust, income received, and any expenses paid. We also provide tax information each financial year as required for lodging tax returns.
4. We facilitate requests for funds
We work with you to make decisions about any funds being requested from the trust to ensure they are for the child’s direct benefit.
5. We close the trust
Once the child reaches the required age, we will take steps to close the trust. We write to both the guardian and child approximately one month before the trust is due to come to an end. We will then work directly with the beneficiary to close the trust including completing any final tax matters, providing a final statement and distributing the funds.
The child will receive a final communication advising when the trust has been closed and the funds been dispersed to them. They will also receive a final statement and any tax related information they may need.
Fees for minor trusts
We strive to provide affordable services for Minors trusts as part of our social responsibility to support the interests of vulnerable Queenslanders. As most Minor trusts only hold a small amount of assets, most customers would find it difficult to source affordable services from the private sector.
We therefore provide additional protection for beneficiaries of Minor trusts to ensure the total fee does not exceed the annual income generated by the trust, with the fee being capped at a small percentage of the assets held in trust.
We provide a summary of our fees and charges as part of your annual statement.
For more information on our fees and charges for minor trust services.
Requesting funds from the trust
Most minor trusts allow for funds to be withdrawn from the trust if it is used for the direct benefit of the child. This could be for their health or education needs.
It’s important to know that when funds are withdrawn from the trust, there are less funds available to be invested. This may reduce the returns gained on any investments and will affect the amount of money available for the child at the end of the trust.
A request for funds can be made by:
- the legal parent or guardian
- the beneficiary themselves once they have turned 18.
When assessing an application for funds we consider the following:
- any specific rules about what purposes the funds may be used for as outlined in the rules of the trust
- the best interests of the child including ensuring the funds will be for their direct benefit
- what other funds could be used for the required purpose, including other trusts or family income.
Approval of fund requests is not automatic so it’s best to discuss these requests with us first before committing to any payments. If we do approve a request, we'll pay the supplier of the goods or services directly.
Apply to request funds from the trust
Fund requests for education and medical expenses
This can include school fees, school laptop, books, tutoring or dental costs such as braces.
For any education and medical expenses, you must complete a budget advice form each year. In the form you'll need to include details about any funds required over the next 12 months for health and education purposes. We assess the request to ensure the funds will be of direct benefit to the child. If approved, we set these funds aside, so they are available as required.
If circumstances change throughout the year, you can make a separate request for funds for education and medical expenses by completing the budget advice form and email to us at [email protected]
Fund requests for maintenance expenses
Some trusts allow for funds to be accessed for the maintenance expenses of the child. This may include food, clothing or accommodation.
To apply for maintenance expenses, you will first need to check with us that this is permitted in the trust. You will then need to complete our request for maintenance payment review form and return to us at [email protected]
As trustee we need information about your family's financial situation before considering requests for maintenance expenses. You'll need to provide the following information for us to determine your eligibility to access funds:
- your family's income and expenses
- how the funds will be used for the child’s benefit.
Request forms
To apply to request funds from a trust, we have the following forms available to download and complete.