Also commonly referred to as a “Discretionary Trust” a Family Trust formalises an arrangement where a Trustee is permitted to hold assets for a Beneficiary (or Beneficiaries) and to distribute income and capital between the Beneficiaries as and when the Trustee exercising discretion decides. The trust deed includes a wide pool of general Beneficiaries with lineal and lateral relations to the nominated Beneficiaries.
The person who sets up the Trust is called the Settlor. He or she is the person who contributes the original property or amount of money (called the settled sum) to enable the Trust to commence (see question “What is the amount of a settled sum?”).
