The Essentials
A Testamentary Trust is any trust established within the context of a Will. It’s usually used to describe a discretionary family trust established as part of a Will.
Testamentary trusts are a useful Estate Planning tool. When combined with a memorandum of wishes this type of trust can be very flexible as well as providing a highly effective tax vehicle for future years.
The Benefits
Establishing a Testamentary Trust can be useful to your beneficiaries in multiple ways including the fact that although assets of the trust may be controlled by the intended beneficiary, they do not form part of that beneficiary’s Estate.
The Advantages
Significant advantages of a testamentary trust include minimising the tax paid by your beneficiaries on the income accrued from their inheritance.
- Capital Gains Tax
- Income Tax
- Trustee flexibility
- Asset protection
- At risk beneficiaries
The ability to protect your assets is a further crucial advantage. This may provide greater flexibility and control over the distribution of your assets to your beneficiaries.