Trust Deed
A Trust Deed is the legal document that establishes a trust and outlines how it must operate. It details the trustee’s powers, the beneficiaries, distribution rules, and the authority to borrow — all essential when applying for Business Loans, Equipment Finance, and Low Doc Asset Finance.
Lenders require the deed to confirm who controls the trust and who must provide guarantees — especially for Trading Trusts and structures with a Corporate Trustee.
Why a Trust Deed Matters in Lending
Trusts are common for asset protection and tax planning, but lenders need to confirm that:
- the trustee is authorised to borrow
- the correct beneficiaries are identified
- unit or discretionary trust rules are followed
- the deed allows guarantees or security
- the trust’s structure aligns with ABN and Partnership records (if applicable)
The Trust Deed acts as the “rulebook” for all financial decisions made by the trustee.
How a Trust Deed Works
- The deed establishes the trust and names beneficiaries
- It outlines how income and capital can be distributed
- The trustee must act within the powers granted in the deed
- Lenders review it to confirm legal authority to sign loan contracts
- Updates require a deed of variation, often by special resolution
Official source: asic.gov.au
Do lenders always require the Trust Deed?
Yes — it is mandatory for any trust applying for finance.
Can a trustee borrow without the deed?
No — the deed must explicitly permit borrowing or provide trustee powers broad enough to include it.
What if the deed is old or missing pages?
Lenders may require a certified copy or a deed of variation to correct or update missing information.
Who are the beneficial owners of a trust?
The beneficiaries — not the trustee — are the beneficial owners.
Can a Trust Deed be updated?
Yes — amendments must follow the variation rules outlined in the original deed.