What is a trustee provision?

What is a trustee provision?

It is a contractual arrangement whereby the grantor gives the trustee legal title to the trust assets and, in exchange, the trustee agrees to hold those assets for the benefit of the beneficiary. The beneficiary need not be (and usually is not) a party to the trust agreement.

Who are the parties in a family trust?

At the core of a family trust, there are three parties: a grantor, a trustee and the beneficiaries. The grantor is the person who makes the trust and transfers their assets into it. The trustee is the person who manages the assets in the trust on behalf of the beneficiaries.

What are the tax provisions for family trusts?

Therefore, migration of family wealth (such as corporate shareholdings, family assets such as jewellery, etc.) to a Trust structure would have required transfer of the same at fair value, in order to comply with Section 56 (2) (x).

Who is responsible for a revocable family trust?

With a revocable family trust, you can act as your own trustee, naming successor trustees to take over the reins if you become incapacitated or pass away. With an irrevocable trust, you’d have to name someone else to act as the trustee. For reference, the table below briefly compares the advantages of common types of trusts:

Are there any recent changes to family trusts?

Many private family businesses are still trying to digest the impact of recent changes to tax legislation, and the use of family trusts as part of the private corporate structure is an area of particular confusion.

At the core of a family trust, there are three parties: a grantor, a trustee and the beneficiaries. The grantor is the person who makes the trust and transfers their assets into it. The trustee is the person who manages the assets in the trust on behalf of the beneficiaries.

With a revocable family trust, you can act as your own trustee, naming successor trustees to take over the reins if you become incapacitated or pass away. With an irrevocable trust, you’d have to name someone else to act as the trustee. For reference, the table below briefly compares the advantages of common types of trusts:

Who are the beneficiaries of a trust account?

The trustee is the person who manages the assets in the trust on behalf of the beneficiaries. The beneficiaries are the individuals who receive some type of financial benefit from the trust, similar to a beneficiary for a life insurance policy.

How are family trusts used in estate planning?

Family trusts can also be useful in estate planning if you’d rather avoid probate. Probate is a legal process that involves the court system. An executor is assigned to collect and liquidate your assets, pay your creditors and distribute any remaining assets to your heirs according to the terms of your will or state inheritance laws.