The 2026-27 Federal Budget, Part 8: Succession Planning, Estate Planning, and Protecting Family Wealt
- Zac Hayes
- May 31
- 7 min read
Most people spend years building wealth.
Very few spend enough time planning what happens to that wealth if something happens to them.
And honestly, that is understandable.
Succession planning and estate planning are not exciting topics.
But they are some of the most important conversations a family can have.
Because building wealth is only one part of the journey.
Protecting it, passing it on properly, and avoiding unnecessary tax, stress, and family conflict is the next step.
And after the 2026 Federal Budget changes, this conversation has become even more important for families with trusts, companies, businesses, investments, and SMSFs.
A note on timing: several of the Budget measures mentioned in this article are announced and not yet law. They are subject to legislation passing Parliament and the final design may change.
The Biggest Misunderstanding Most Families Have
A lot of people assume their will controls everything they own.
But that is not always true.
Your will only controls assets you personally own.
For example:
• Your personal bank accounts
• Your home in your own name
• Your personal shares
• Your car
• Your personal investments
But assets held inside trusts and companies work differently.
And this is where proper structuring becomes incredibly important.
What Happens to Trust Assets When Someone Dies?
One of the biggest advantages of trust structures is this:
The trust assets are generally not personally owned by you.
The trust owns them.
That means when someone passes away:
• The trust usually continues operating
• The assets stay inside the trust
• The investments are not automatically sold
• There is generally no immediate capital gains tax event triggered purely because of death
This is one of the reasons many families use trusts for long term wealth planning.
The structure can continue across generations.
Why This Matters for Families
Without proper planning, family wealth can become tied up in:
• Probate delays
• Estate disputes
• Tax issues
• Family disagreements
• Poor succession planning
A good structure helps reduce a lot of these risks.
It creates continuity.
The goal is helping the family move forward smoothly during an already difficult time.
The Real Question Is Usually About Control
One of the most important parts of a trust is something called the appointor.
In simple terms:
The appointor is usually the person who controls who controls the trust.
That may sound strange, but it is incredibly important.
Because when the original founder passes away, someone needs to step into that control role.
This is where many families run into problems.
Especially when:
• No successor is named
• Multiple children are given equal control without a plan
• Wills and trust deeds do not work together properly
• Family expectations are unclear
Good succession planning is about creating clarity before problems happen.
Not after.
Why Corporate Trustees Matter
This is another area many people overlook.
When individuals act as trustees personally, changing ownership after death can become messy and expensive.
But when a company acts as trustee, the process is usually much smoother.
The company continues existing even if directors change.
That means:
• Assets usually stay in the same structure
• Property ownership does not constantly need changing
• Administration is simpler
• Long term continuity improves
For many families, this becomes one of the most practical benefits of using a corporate trustee structure.
If your family wealth is held across trusts, companies, SMSFs and personal assets, succession planning is no longer a single document conversation. It is a structure conversation.
The Business and Wealth Collective's Post-Budget Trust and Company Structure Strategy Session can help you understand whether your current setup will hold up across generations under the new rules.
What Changed After the 2026 Budget?
Interestingly, the Budget did not completely change succession planning.
A lot of the core estate planning rules stayed the same.
But what did change was the way wealth structures are now being built moving forward.
Especially around:
• Trust income
• Share classes
• Investment structures
• Long term income flow
That means the way families pass wealth between generations is starting to evolve as well.
Why Share Classes Are Becoming More Important
One of the biggest changes after the Budget is the increasing use of company share classes.
This sounds technical, but the idea is actually fairly simple.
Different family members may own different classes of shares in a company.
For example:
• Mum holds A Class shares
• Dad holds B Class shares
• Adult children hold C Class shares
The company can then potentially pay dividends differently across the family group.
But here is the important succession point:
Those shares are personally owned assets.
Which means when someone passes away, those shares form part of their estate.
That is where wills and testamentary trusts become incredibly important.
What Is a Testamentary Trust?
A testamentary trust is a trust created through your will after you pass away.
In simple terms:
Instead of assets going directly to beneficiaries personally, the assets are held inside a protective trust structure.
This can create major advantages around:
• Asset protection
• Tax planning
• Protecting children and grandchildren
• Managing family wealth long term
• Protecting inheritances from relationship breakdowns or creditors
For many families, testamentary trusts become one of the most important long term wealth protection tools available.
One Major Advantage for Families with Children
This is one of the biggest reasons testamentary trusts matter.
Normally, children under 18 are taxed heavily on trust income.
But testamentary trusts receive special tax treatment.
In many situations, children receiving income through a testamentary trust can access normal adult tax rates instead of punitive minor tax rates.
For larger families, this can create enormous long-term benefits.
Especially where family wealth is intended to support future generations.
Why This Matters Even More After the Budget
This is one of the most important nuances of the Budget changes for families thinking about wills and estate planning.
Testamentary trusts already in existence on Budget night, 12 May 2026, kept many of their existing tax advantages.
But discretionary testamentary trusts created from new wills, or where the willmaker passes away after Budget night, are intended to be captured by the new 30% minimum trust tax.
That is a major reason wills are now being reviewed across the country.
For families currently drafting new wills, or who have wills due for review, this is a significant change to the planning landscape.
For many families, the future now looks more like this:
• Family trusts for asset protection and long-term wealth holding
• Companies and share classes for income flow
• Testamentary trust planning carefully designed around the new rules
• SMSFs for retirement wealth
The goal is building structures that work together across multiple generations.
Superannuation is another area many families misunderstand.
Super does not automatically flow through your will.
Instead, super is controlled by:
• Binding death benefit nominations
• The super fund trustee
• Superannuation law
This means your super needs its own planning strategy.
Especially for larger balances.
With Division 296 applying from 1 July 2026 to balances above $3 million, and a second threshold at $10 million, planning around super has become even more important for higher wealth families.
The Biggest Mistake Families Make
The most common issue we see is people building wealth structures but never properly planning succession.
For example:
• No updated wills
• No testamentary trusts
• No successor appointor planning
• No coordination between the trust deed and the will
• No review of super nominations
• No long-term family governance planning
That creates stress, confusion, and unnecessary risk later.
Good planning is about creating clarity before a crisis happens.
If you are unsure whether your trusts, wills, company structure, SMSF or succession plan still make sense after the new Budget changes, now is the right time to review it properly.
Book your Post-Budget Trust and Company Structure Strategy Session before EOFY.
The Bigger Picture
At the end of the day, succession planning is not really about documents.
It is about protecting the people you care about.
It is about making life easier for your family during difficult periods.
It is about preserving wealth that may have taken decades to build.
The families who usually maintain wealth across generations are not simply focused on making money.
They focus on:
• Protection
• Long term planning
• Communication
• Flexibility
• Family stability
• Structures that can adapt over time
That is where proper succession planning becomes incredibly powerful.
Final Thoughts
The 2026 Budget changed many tax and structuring rules.
But it did not change the importance of proper estate and succession planning.
If anything, it made good planning even more valuable.
Because the way wealth is built, controlled, and passed between generations is evolving.
And families who plan early usually create far better long-term outcomes.
The goal is not just building wealth.
The goal is protecting it for the people who matter most.
Review Whether Your Succession Plan Still Works
Every family situation is different. The right strategy depends on your family structure, business interests, investments, retirement goals and long-term wealth plans.
Book your Post-Budget Trust and Company Structure Strategy Session with The Business and Wealth Collective.
General Information Disclaimer
This article provides general information only and does not take into account your personal circumstances, objectives, financial situation, tax position or legal structure. It is not personal tax, financial, legal or investment advice.
The Federal Budget measures discussed in this article were announced on 12 May 2026 and many require legislation, regulations, ATO guidance or further program detail before they take effect. The final rules, eligibility criteria, thresholds, timing and practical outcomes may change.
Before making decisions about tax, superannuation, property, trusts, business structures, investments, asset sales or contributions, you should obtain advice based on your specific circumstances.
The Business & Wealth Collective can help you review your position and identify which areas may require further advice before EOFY.
Tax agent services within The Business & Wealth Collective are provided by Configured Business Solutions Pty Ltd (Tax Agent No. 26109304).
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