Trusts are a popular way of protecting property and managing assets.
A trust is created when a person (the settlor) transfers property to people (known as trustees). Trustees are obliged by law to use the property for purposes that the settlor has specified. It is a relationship between trustees and beneficiaries which imposes duties on the trustees to deal with the trust property in the interests of beneficiaries.
Trusts can be set up for charitable purposes such as education or established specifically for the benefit of the members of a particular family. The terms of trusts can differ depending on the purpose for which a trust has been established.
Why have a family trust?
- Protect assets for family members
- Ensure certain assets are transferred intact to the next generation
- Protect family members or a family business from possible relationship property or family protection (contesting a will) claims
- Manage the assets of someone who is unable to manage their own affairs, perhaps through age or infirmity
- Assist with estate administration by transferring assets to a trust before death