Hello friendly knowledgeable people,
I hope you can help me. I have two minor grandchildren - 3 and 1 yo. My mother has deceased and left her estate to her 3 adult children in a Testamentary Trust each for myself, my brother and my sister - 3 separate Trusts. In my TT, I am the primary beneficiary followed by my adult children and then my grandchildren. I would like to set up a plan for my grandchildren whereby I create a kids account (say Vanguard) and take funds from the Trust and put those funds into the kids accounts fortnightly (an account for each child) and then have those funds placed into an EFT or Managed Fund with Vanguard. I am aware that TTs allow a higher amount of income before tax for minors in that they are basically treated as adults insofar as their taxable earnings are concerned. This means that the $416 tax threshold does not apply. This sounds like a good idea to me. 😀 I want to commence using the Trust to my grandchildren's advantage.
My questions are, can I set up the kids account and have funds coming from a TT so that the extra tax benefits can be taken advantage of ie using the Trust instead of me? If I can take advantage of the Trust, what account should I set up with Vanguard - is it a Vanguard Personal Investor account even though it is a Trust? What are the CGT issues having a Trust involved? Will my grandchildren each require a TFN? I want to get this right as I don't want problems down the track nor any nasty surprises either. Apologies for so many questions. Thank you in advance for your assistance.
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