Trusts – what are they?
Trusts must have three things:
- Certainty of intention
- Certainty of objects
- Certainty of subject matter
But what does this mean?
This means that much like a triangle, there are three points to a trust. Firstly there must be an intention to have a trust.
Secondly, certainty on who is to benefit.
Thirdly, certainty of what assets are going into the trust.
Trustees are appointed to be the legal persons in charge of the trust. They will administer the income and capital and take legal ownership of all trust assets.
Trustees in a discretionary trust, will have discretion on which beneficiaries you have named in the trust will benefit from income and capital of trust assets.
Trusts are used to reduce tax liabilities, protect vulnerable beneficiaries, reduce how much you have to pay for care home fees and protect business assets.