Trust

The concept dates back to the middle of the 11th century, to the period of Norman conquest of England. Now, the developed form of the trust has become one of the most effective tax and estate planning techniques.

The modern concept of the trust refers to the duty or aggregate accumulation of obligations that a settlor gives to a trustee, by transferring his assets to the third party. The trustee administers the trust property in a way lawfully prescribed by the trust instrument (Trust Deed or Settlement Deed, Declaration of Trust).

There are three basic types of trust:

  1. an 'Interest in Possession' trust allows for a particular beneficiary, often the settlor, to have a distinct right to income from part of the trust's capital assets;
  2. an 'Accumulation and Maintenance' trust allows for income to accumulate until a class of beneficiaries reach a certain age;
  3. a 'Discretionary' trust vests discretion with the trustees to decide how both income and capital are distributed.

Trusts do not have shares.

Trustees

The persons whose duty is to act in accordance with a Trust Instrument for the benefit of the beneficiary(ies).

Trust Deed

Trust Instrument (also Settlement Deed or Declaration of Trust), laying down the ways how the trustees should conduct administration and management of the trust, and how they are to distribute trust assets and income derived from the trust activities among the beneficiaries.

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