Overview
A discretionary trust provides clients with control and flexibility over how wealth is distributed.
Quick facts
- For use with the Collective Investment Bond.
- Available under the law of England & Wales and Scotland.
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This is a trust where your client, the settlor, cannot be included as a beneficiary.
- The settlor chooses their trustees. They can also appoint themselves as a trustee. We would recommend appointing an independent trustee.
- Classes of beneficiary are defined within the deed; for example, ‘children and decedents of the settlor’. Beneficiaries not covered by the classes can be added to the trust by the settlor.
- The trustees use their discretion to decide who may benefit from the trust and when.
- The beneficiaries cannot demand their rights from the trustees.
Suitability
Guides and helpful documents
Technical support
- Discretionary trust calculator - Calculate the entry, periodic and exit charges for your client’s trust.
- Taxation of discretionary trusts: Quick reference guides - Quick guides showing you how to calculate the entry, periodic and exit charges.
- Trust: Who pays the tax? A brief overview of the income tax, CGT and IHT treatment of trusts.