trust can be made up of assets such as cash, property, bonds, stocks and other financial products intended to benefit an individual or organisation. The purpose of a Trust is to provide financial benefit to an individual, most often a child or grandchild – or organisations, such as a charity or other non-profit organisation.
Trusts can be a good way of mitigating capital gains or inheritance tax, or good way to benefit a family member during your lifetime. A number of tax benefits apply to Trust depending the structure.
The Four Main Components In a Trust
- Settlor: The person who creates the Trust (also known as “donor,” or “trustor”)
- Trustee: The person, people, or entity (such as a bank) that agrees to hold the property or assets (the grantor may be the Trustee)
- Principal: The property or assets themselves, including money, which is held in the Trust and managed by the Trustee
- Beneficiary: The person or people who ultimately receive the property or assets in the Trust
Trusts come in various forms such as Discretionary Trusts, Bare Trusts and Pilot Trusts and a minor beneficiary of a Trust will usually to wait until a certain age, or until a specified event occurs, to receive the object of the Trust. Alternatively, a trust can exist for the lifetime of a beneficiary or beneficiaries and they will receive a yearly income or regular unspecified amount from the fund. A single trustee, or a group of trustees, manages the fund in a manner appropriate to the trust fund’s specifications. This will usually include some allowance for living expenses and perhaps educational expenses, such as private school or college.
Upon the creation of a trust the trustees become the legal owners of the trust property. Legal title is separate from the ownership of the beneficial interests. A trustee must honour certain duties and obligations imposed by law which may be modified by the terms of the trust instrument.
Trust law can be complex and therefore individuals must ensure that they instruct trained experts within the field. Our team understands the common law trust principles and has extensive experience in drafting every kind of trust document.
Our Trust service includes:
Trust and Trustee advice
Inheritance tax planning and advice
Estate planning and advice
Asset protection advice
- Trust administration
Our team has the necessary knowledge and experience to guide you through the best Trust structure for you. To find out more about our Trust administration services call us now on 0344 330 4121 or email us on firstname.lastname@example.org.
To find out more about Trusts and the options available to you, contact Premier Direct Law today.