C13 - Types Of Trust Flashcards

1
Q

Revocable trust

A

Settlor may revoke the trust and reclaim the assets if they change their mind after settling the trust or if their circumstances change in the future

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2
Q

Irrevocable trust

A

Unable to change or undone

Courts have powers to vary terms of trust

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3
Q

Discretionary trusts

A
Settlor specifies who may benefit either by naming beneficiaries or by stating class of beneficiaries 
Trustee had power to accumulate income or to distribute income/capital
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4
Q

Hybrid interest in possession trusts

A

Death of life tenants, trust changes from llp to discretionary

Allows settlor to retain benefit for
Himself and restrict benefits enjoyed by fire beneficiaries

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5
Q

Charitable

A

Established to benefit charities

Purpose: relief poverty, further of religion, education, benefit community

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6
Q

Interest in possession

A

Beneficiary has fixed interest from outset stated in trust deed

Life tenants are entitle to income from trust during lifetime

Stealth of life tenant - trust property passes to names ‘residual beneficiaries ‘ in specified amounts/portions

Used by settlor who wish for income from from assets to he enjoyed buy capital preserved for future generations

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7
Q

Accumulation and maintenance

A

Maintenance of children under 25

Settlor/spouse never benefit

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8
Q

Irrevocable

A

Can’t be changed or undone

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9
Q

Protective/spendthrift trusts

A

Trust terms may make interest of beneficiaries liable to terminate at specific date (bankrupt, attempt to sell, dispose rights of assets)

Protests assets at times as they’re not available to creditors

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10
Q

Revocable

A

Settlor can reclaim assets

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11
Q

Settlor reserved powers

A

Remove trustee, enforcer, protector, beneficiary

Powers - directions as to appoint investment manager

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12
Q

Employee

A

Employers may create to benefit employees and family’s

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13
Q

VISTA

A

Settlor wishes to retain control over underlying company or shares to be retained regardless of performance BVI

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14
Q

STAR

A

Mix purpose and beneficiaries within same trust

Beneficiaries don’t have enforceable rights

At least - enforces

1 trustee licence trust corporation in Cayman Islands

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15
Q

Bare

A

Trustee holds property

Trustee no discretionary power and just hold property and deal with it or transfer

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16
Q

Unit

A

Pooled Into unit trust

Investment vehicle for investors

17
Q

Fixed interest

A

Benefited absolutely entitles to fixed interest