What is a Trust?
Private trusts can be classified based on various factors:
- Revocable Trust vs. Irrevocable Trust: Revocable trusts can be altered or terminated, while irrevocable trusts cannot.
- Discretionary Trust vs. Specific Trust: Discretionary trusts grant the trustee discretion in distributing income/assets, while specific trusts have fixed beneficiaries.
Benefits a Private Trust
- In the Event of a Personal Dispute assets of the trusts are not attached
- The Tax Structure of the Trust is most Beneficial as compared to individual.
- Succession Planning works well under Tax Structure as Compared to nominating individual as
The key responsibilities of a trustee in a Private trust include-
- Administration: The corporate trustee handles the day-to-day administrative tasks of the trust, such as record-keeping,
asset management, and compliance with legal and regulatory requirements.
- Fiduciary duty: The corporate trustee has a fiduciary duty to act in the best interests of the beneficiaries, ensuring that
the trust’s assets are managed prudently and in accordance with the trust’s terms.
- Distribution of income and assets: The corporate trustee is responsible for distributing income and assets from the trust
to the beneficiaries according to the terms of the trust document. They ensure that distributions are made in a fair and
- Objective decision-making: As a neutral third party, a corporate trustee can make impartial decisions, avoiding conflicts
of interest that may arise when family members serve as trustees.
Role of Corporate Trustee in Private Trust
The role of a corporate trustee in a private trust is to act as a professional entity responsible for managing and administering the trust on behalf of the beneficiaries. It is advisable to opt for corporate trustee for family trust as it provide benefits of corporate with long term sustainability and corporate governance. When selecting a corporate trustee, consider factors such as their reputation, financial stability, range of services offered, fee structure, and communication and responsiveness.
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