Tuesday, September 22, 2020

Trust structuring checklist - vol I**

View Legal Blog Trust structuring checklist - vol I

Over the years we have developed a checklist of some of the key issues that should be considered whenever establishing or varying a discretionary trust.

Obviously, the relevance of each issue depends on the exact circumstances of the client and over this and the next two posts, each of the 21 issues in our non-exhaustive list will be summarised.

The various issues are not listed in any particular order of priority and the first seven items on the checklist are as follows:
  1. Who is the trustee of the trust?
  2. If the trustee ceases to act, do their powers pass to anyone else, and if so, who?
  3. Is the trustee an individual or a company?
  4. If the trustee is a company, who are the directors?
  5. Is there a default distribution of the income and capital of the trust to certain beneficiaries?
  6. Does the trust deed restrict the range of beneficiaries who can receive income or capital distributions?
  7. Does the trustee need consent/approval of any other person for distribution?
** for the trainspotters, a classic song from George Michael album ‘Listen without prejudice (Vol. 1)’, namely ‘Freedom 90’.