A Trust is an estate planning instrument for an Individual to ensure that his assets are protected and looked after by a Trustee or Trustees for the benefit of the trust beneficiaries.
The Trustee receives the assets from the Settlor and is legally obligated to hold and manage the assets for the enjoyment of the beneficiaries during the trust period set by the Settlor.It is commonly known as “Living Trust”
A person appointed by the Settlor with the following job scope:-
The assets commonly used to set up a trust are: cash, insurance policies, unit trust, properties, shares. The property under Trust do not belong to the Trustee personally. Though the trust property is registered in the Trustee’s name, it is NEVER part of the Trustee’s own properties when he dies. Only the Trust beneficiaries will be entitled to the Trust Fund NOT the Trustee’s own beneficiaries.
Trust of this nature is useful when you have:-
This is achieved by creating a Discretionary Trust when any of the beneficiary becomes bankrupt, he will no longer be entitled to the benefit under the Trust.
Preserving assets for your great grandchildren.
For example education and maintenance fund for grandchildren, nephews etc
|When is the actual transfer of assets?||During the lifetime of the Settlor.||After the demise of the Testator and Grant Of Probate extracted.|
|When does it become effective?||Upon transfer of assets to the Trustee or triggering event.||Upon the demise of the Testator|
|Will the assets be frozen upon death?||No.||Yes.|
|Is there any application to the Court necessary?||No.||Yes, must apply for Grant Of Probate.|
|Can there be more than one?||Yes.||The latest Will prevails.|
|Can it be revoked?||Yes, the Settlor can revoke when the trust is revocable one.||Anytime by the Testator before his demise.|
|Creditor protection?||Yes, if it is irrevocable and after 5 years from the date it was created.||-|
|Can conditions be stated?||Yes.||Yes.|
|Can I give to any person/organization I choose, even if unborn?||Yes.||Yes.|
|Can additional assets be included?||Yes, by doing a supplemental deed.||Yes, by rewriting the Will or the new assets will be distributed under the residuary estate.|
|Can the Trustee/Executor be removed?||Yes, by doing a supplemental deed.||Yes, by rewriting the Will.|
|Can the Protector remove and appoint the Trustee?||Yes, subject to such conditions as may be stipulated.||There is no Protector. Testator can reappoint Trustee by rewriting his Will.|