A family trust in New Zealand: what it is, what it costs and when it is worth it
A family trust is a legal structure set up during your lifetime, where you transfer assets such as the family home to trustees who hold them for named beneficiaries under the Trusts Act 2019. Public Trust's minimum non-refundable set-up fee is $818, with a straightforward trust including asset transfer typically costing $4,600 to $5,700 all-in (Public Trust, Family Trusts price list, retrieved 9 September 2026).
This is different from a testamentary trust, which is written into a will and only comes into existence on death; see testamentary trusts in NZ for that separate structure and cross-check both before deciding which, if either, fits your situation.
What a family trust actually is
A family trust involves three roles: the settlor, who creates the trust and transfers assets into it; the trustees, who legally own and manage those assets according to the trust deed and the Trusts Act 2019; and the beneficiaries, who the trust's assets and income are ultimately held for. A settlor can also be a trustee and a beneficiary, which is common in a typical New Zealand family trust.
What is a family trust and how does it work in NZ?
A family trust is created by a trust deed, which sets out the trustees, the beneficiaries and the rules for managing the trust's assets, and it takes effect once assets are actually transferred into the trustees' names, unlike a testamentary trust which waits until death (Trusts Act 2019, s15, New Zealand Legislation, retrieved 9 September 2026). Once assets are in the trust, the trustees, not the settlor personally, legally own them, and must manage them for the beneficiaries under the Act's duties.
What is the difference between a trust and a testamentary trust?
An ordinary family trust is set up and operates while you are alive, with a trustee actively managing transferred assets from that point onward. A testamentary trust exists only inside a will and comes into being on death, so until then there is no trust, no trustee acting, and no assets held (Wills Act 2007, s8(4), and general trust law, retrieved 9 September 2026). See testamentary trust NZ for that comparison in full.
What assets typically go into a family trust?
The most common asset is the family home, followed by rental properties, shares, business interests and significant savings, though almost any asset with clear legal ownership can be transferred (Public Trust; general trust practice, retrieved 9 September 2026). Personal items of low value and everyday accounts are rarely worth the administrative cost of holding in trust.
Does a family trust protect the family home from creditors?
It can, but with important limits. Assets genuinely transferred into a trust well before any financial trouble arises are generally protected from a later personal creditor, but subpart 6 of the Property Law Act 2007 lets a court set aside a disposition of property made to defeat a creditor, and a transfer made shortly before trouble starts is the one most likely to be challenged (New Zealand Legislation, ss 344 to 350, retrieved 9 September 2026). Protection is strongest when the trust is set up well in advance, for genuine reasons, not as a last-minute reaction to risk.
What it costs
Trust set-up pricing varies with complexity, and the table below lines up named providers.
The figures below are for setting up the trust and transferring assets into it; ongoing annual administration is a separate, additional cost.
| Provider | Set-up cost | Notes |
|---|---|---|
| Public Trust | $818 non-refundable set-up fee; from $1,636 if you delay transferring assets; approximately $4,600 to $5,700 all-in with asset transfer for a straightforward trust | A more complex trust costs more |
| MYNZ Trust (named firm) | $1,550 plus GST fixed fee | Additional services (annual meetings, gifting) charged separately |
| estateplanning.co.nz (named firm) | From $2,500 one-time setup fee | Includes deed drafting, IRD registration, first year minutes |
Source: Public Trust, Family Trusts price list, retrieved 9 September 2026; MYNZ Trust, Family Trust Pricing, retrieved 9 September 2026; estateplanning.co.nz, Pricing, retrieved 9 September 2026.
How much does it cost to set up a family trust in NZ?
Public Trust's own price list sets a non-refundable $818 set-up fee, rising to roughly $4,600 to $5,700 all-in for a straightforward trust once asset transfer costs are included, while other named providers quote fixed fees from around $1,550 to $2,500 for set-up alone, with actual asset transfer, legal work and ongoing administration adding further cost (Public Trust; MYNZ Trust; estateplanning.co.nz; retrieved 9 September 2026). A more complex trust, or one holding a business or multiple properties, costs more again.
Are there ongoing costs after a trust is set up?
Yes. A family trust needs ongoing administration once it exists: annual trustee meetings and minutes, accounting, and compliance with the Trusts Act 2019's record-keeping and disclosure duties. Providers such as Public Trust and MYNZ Trust both offer fixed annual administration fees on top of the initial set-up cost (Public Trust; MYNZ Trust; retrieved 9 September 2026). A trust that is set up but not properly administered afterward can lose much of the legal protection it was meant to provide.
Trustee duties under the Trusts Act 2019
The Trusts Act 2019 sets out mandatory duties that every trustee must follow and cannot be excluded from the trust deed, alongside default duties that a deed can modify or exclude.
| Mandatory duty | What it requires |
|---|---|
| Duty to know the terms of the trust (s23) | The trustee must know what the trust deed actually says |
| Duty to act in accordance with the terms of the trust (s24) | Decisions must follow the deed, not the trustee's personal preference |
| Duty to act honestly and in good faith (s25) | Basic good faith towards the trust and beneficiaries |
| Duty to act for the benefit of beneficiaries or a permitted purpose (s26) | Assets must be managed for beneficiaries, not the trustee's own benefit |
| Duty to exercise powers for a proper purpose (s27) | Powers cannot be used for an unrelated or improper reason |
(Trusts Act 2019, ss 22 to 27, New Zealand Legislation, retrieved 9 September 2026.)
Do I have to tell beneficiaries they are named in the trust?
Generally yes. The Trusts Act 2019 introduced a presumption that trustees must give basic trust information to every beneficiary, including that they are a beneficiary and the trustees' contact details, and under section 53 a trustee must reasonably consider certain factors before deciding to withhold information from a beneficiary, rather than simply declining (Mortlock McCormack Law, Trusts Act Disclosure Rules, retrieved 9 September 2026; Trusts Act 2019, s53). This is a significant change from the position before 2021, when disclosure was far more discretionary, and courts have since taken an increasingly active supervisory role over trustees who refuse a disclosure request.
Can I be a trustee of my own family trust?
Yes, you can be both a settlor and a trustee of your own family trust, and many family trusts have the settlors acting as trustees, sometimes alongside an independent trustee. The one restriction is that a sole trustee cannot also be the sole beneficiary of the same trust, since that would collapse the separation the trust is meant to create (Trusts Act 2019, s14, New Zealand Legislation, retrieved 9 September 2026).
How long can a family trust legally last?
The Trusts Act 2019 allows a trust to run for up to 125 years from the date it is created, unless the trust deed sets a shorter period, a significant increase from the 80-year maximum that applied to trusts created before the Act (Trusts Act 2019, s16, New Zealand Legislation, retrieved 9 September 2026).
Is a family trust still worth it after the Trusts Act 2019?
It depends on why you are considering one. The Trusts Act 2019 increased trustees' record-keeping and disclosure duties to beneficiaries, and separately, courts have become more willing to look through trust structures in relationship property and creditor disputes, which has narrowed the asset-protection case for a trust compared with decades ago (Trusts Act 2019; general case law, retrieved 9 September 2026). A trust remains useful for succession planning, managing assets for a vulnerable beneficiary, or business succession, and less reliably useful as a way to shield the family home from a future relationship property claim.
What are the disadvantages of a family trust?
A family trust adds ongoing cost and administrative burden, requires the settlor to genuinely give up personal ownership of the transferred assets to the trustees, can complicate borrowing since a bank must lend to the trust rather than the individual, and no longer offers the reliable relationship property or creditor protection many people assume it does (Public Trust; MYNZ Trust; general trust law commentary; retrieved 9 September 2026). See our guide to the Property (Relationships) Act in NZ for how relationship property rules interact with assets held in trust.
Does a family trust help with a relationship property claim?
Less reliably than in the past. Courts have shown increasing willingness to treat trust assets as relationship property in substance, particularly where a trust was set up or used in a way that defeats a partner's claim, and the Property (Relationships) Act 1976 itself has specific provisions letting a court compensate a partner from trust property in some circumstances (general case law and commentary, retrieved 9 September 2026). A trust set up for genuine, non-relationship reasons long before a relationship in question is on stronger ground than one set up during or in anticipation of a relationship dispute.
What happens to a family trust when the settlor dies?
A properly set-up family trust does not end when the settlor dies, since the trust already legally owns the assets, separate from the settlor personally; the trustees simply continue managing the trust under the trust deed and the Trusts Act 2019 (New Zealand Legislation, retrieved 9 September 2026). This is one of the practical differences from personal assets, which pass through the will and can require probate; trust assets generally bypass that process entirely.
Family trust vs the alternatives
The table below sets out the main structures side by side, since a family trust is only one of several tools that solve overlapping but different problems.
| Structure | When it applies | Typical cost |
|---|---|---|
| Family trust | While you are alive, ongoing | From $818 set-up, plus ongoing administration |
| Testamentary trust | Only from death, written into a will | Typically $1,500 to $3,000 added to a will's cost |
| A simple will with no trust | Straightforward estates, adult beneficiaries who can manage money | From $69 online through Public Trust |
| Power of attorney | While alive, for decisions if you lose capacity, not asset ownership | From $220 to $1,200 |
(Public Trust; PK Law; lawyerfinder.co.nz; retrieved 9 September 2026.)
If a testamentary trust would achieve what you actually want, protecting a young or vulnerable beneficiary's inheritance only from the point you die, it is usually far cheaper and simpler than setting up and running a family trust for decades beforehand. See testamentary trust NZ for that comparison, and making a will in NZ, our will template guide, or Public Trust wills in NZ for how either fits alongside a straightforward will.
Where a family trust fits in your wider planning
A family trust is one part of a wider estate plan, not a replacement for a will, power of attorney, or adequate insurance. QuoteHub's own free will service is a no-cost starting point if a trust is not yet the right tool for your situation. Whatever you hold personally, outside any trust, still passes under your will or under the intestacy rules if you have none; see dying without a will in NZ for that scenario, and administering a deceased estate in NZ for how assets, whether personal or held in trust, are actually collected in and distributed. There is no inheritance tax in New Zealand to plan a trust around, though trustee income not distributed to beneficiaries is taxed at the 39% trustee rate; see inheritance tax in NZ for the full tax picture.
If you hold life insurance, income protection or trauma cover, whether a policy is owned personally or by a trust affects how a payout is taxed and who receives it; see who gets your life insurance payout in NZ for how ownership and nomination interact. A licensed financial adviser or your nearest insurance adviser, including in Auckland and Christchurch, can talk through the ownership structure that suits your situation, and the life insurance calculator is a useful starting point for working out how much cover a family actually needs. Financial advice is provided by Craig Smith Business Services Limited, trading as Smiths Insurance & KiwiSaver, a licensed Financial Advice Provider (FSP712931). QuoteHub is a trading name.
Adviser's view
QuoteHub's read is that a family trust has become a much narrower tool since the Trusts Act 2019 and recent case law tightened relationship property and creditor protections that trusts used to offer more reliably. It is still worth it for genuine asset-management or succession reasons, and increasingly not worth it for the reason most people set one up decades ago, keeping assets away from a future ex-partner or creditor.
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Cite this page QuoteHub NZ (2026). Family Trust NZ: What It Is, Cost, When to Use One. www.quotehub.co.nz/guides/estate/family-trust-nz. Updated 2026-09-09.
References
- Trusts Act 2019
- Public Trust: Family Trusts price list
- MYNZ Trust: Family Trust Pricing
- estateplanning.co.nz: Pricing
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