What is Trust By Leigh Barker

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What is Trust

• Leigh Barker MWC Group

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A trust is a business structure

• A trust is a business structure whereby the
  trustee conducts a business on behalf of the
  beneficiaries.
• As a trust is not a separate legal entity, a
  trustee must be appointed.

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A trustee..

• A trustee can be an individual or a company
  whereas a beneficiary can be a person, a company
  or the trustee of another trust.
• The trustee will manage investments, maintain
  records, and manage assets and distributions. The
  overriding duty of a trustee is to adhere to the
  terms of the trust deed and to act in the best
  interests of the beneficiaries.

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The trust deed

• A trust is established by a formal deed that
  outlines how the trust is to operate. The trust
  deed defines the relationships between the
  trustee and the beneficiaries and sets out the
  duties and powers of the trustee.
• A trust distributes on an annual basis all
  profits to the beneficiaries who pay tax
  individually and provided that all profits are
  distributed a trust does not pay tax.

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• A trust structure has both advantages and
  disadvantages and without identifying any
  specific type of trust they are generally seen to
  be
• Asset Protection
• The ability to pass wealth from one generation to
  the next
• A reduction in liability where a company acts as
  trustee
• The expense of establishing and administering
• The inability to distribute losses
• The limited life of the trust deed

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Prior to deciding on a business structure

• Prior to deciding on a business structure seek
  professional advice from an accountant, solicitor
  or business advisor to ensure that the structure
  selected meets your personal circumstances and
  business objectives.

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Leigh Barker

• Please note Prepared by Leigh Barker MWC Group,
  Accountant, Portfolio Finance, Gordon, West
  Pennant Hills and Tangible Assets.
• Note that all content of this blog is general in
  nature and anyone intending to apply the
  information to practical circumstances should
  seek professional advice to independently verify
  their interpretation and the informations
  applicability to their particular circumstance.