Estate Planning and Shares: Avoiding Tax Surprises for Your Family 

For many families, shares form a significant part of their wealth. As more clients begin to plan how their investments will pass to the next generation, it’s important to understand that how these assets are transferred can make a big difference to the tax outcome. 

When shares are held in a trust structure, what seems like a simple transfer can sometimes trigger unexpected tax consequences for beneficiaries. Without the right estate and tax planning, this can reduce the value of what’s ultimately passed on. 

Meet John and Helen 

John and Helen set up a family trust years ago to hold their growing share portfolio. Like many of our clients, over time, these investments became central to their wealth. 

When we recently reviewed their estate plans, we explained that transferring the shares directly from the trust to their children could trigger an immediate tax liability.

Why trust structures can create tax surprises 

Trusts are a popular way to manage family investments because they offer flexibility and protection. But when it comes time to transfer shares to beneficiaries, the rules can be complex. 

In some situations, a tax obligation can arise when a beneficiary becomes entitled to the shares – even if no money has changed hands. 

Alternatively, shares that are inherited directly from an estate are often eligible for rollover relief, meaning they can pass to beneficiaries without immediate tax. This difference can be significant, especially for families with large long held portfolios. 

Why estate planning matters 

If you have shares or other investments held in a trust, it’s important to: 

• Review your structure – understand how assets would pass to beneficiaries. 

• Keep clear records – accurate cost bases help avoid confusion or disputes. 

• Seek advice early – proactive tax planning can help reduce or defer tax. 

Protecting your family’s legacy 

Trusts remain a valuable estate-planning tool, but they aren’t automatically the most tax-efficient option for every family. With the right tax and estate planning advice, you can ensure your wealth is transferred smoothly and your loved ones aren’t left with unexpected tax obligations. 

How Morrows can help 

At Morrows, we work with families to create intergenerational wealth strategies that balance control, protection, and tax efficiency. Our advisors can review your existing structures, highlight potential risks, and help you plan a smarter way to pass on your investments. 

If you’d like to understand how to maximise your family legacy, reach out to your Morrows advisor on 9690 5700. We’re here to help.