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It
is important for families to have a logical Financial Plan and
Trusts have a key role to play. |
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They are separate legal entities and the Trustees have onerous
responsibilities to ensure they are properly maintained. |
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Before
starting the process the basic facts have to be established: |
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•
Marital
status
•
Life expectancy
• Assets
(exact ownership)
• Unrealised
Capital Gains
• Liabilities
• Income
• Normal
expenditure
• Can
you afford to dispose of assets? |
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The
purpose of a Trust needs to be considered: |
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•
Tax
reduction
•
Asset protection (business failure, marriage breakdown, unsure
of
effect on offspring)
• A
combination of both |
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Further
specific facts need to be established: |
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•
The
value of assets you want to transfer
•
Your attitude to paying tax
• Whether
you can name the Beneficiaries now
• How
old the Beneficiaries are
• The
Beneficiaries tax positions |
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Plenty
of other issues need to be considered, for example: |
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•
Equalisation
for Beneficiaries
•
Who would be Trustees?
• The
Settlor usually has a guiding influence - what happens on the
Settlor's death?
• Annual
review
• Annual
maintenance
• Costs |
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