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When setting up a trust, when does said trust terminate?

Similar to companies and close corporations, setting up a trust may specify that the trust have a perpetual existence that is not attached to the life of any person. The fact that trusts can exist for generations is one of their core benefits. There are no rules that...

Things to consider before registering a living (inter vivos) trust

Anyone thinking of setting up a trust needs not only to make sure that he/she is creating a valid legal structure, but also to understand the nature of the trust, the duties of trustees, and the rights of beneficiaries. Before you create a living trust, do your...

When forming a trust, is being the founder of the trust important?

Often when trust practitioners are forming a trust for their clients, they choose arbitrary founders for the trust, completely disregarding this critical requirement. Clients are often advised that the founder cannot, or should not, simultaneously hold the role of...

The Courts on inclusion of discretionary trust assets upon divorce

Trusts are frequently used (and abused) by spouses as a vehicle into which they transfer their assets, using the discretionary trust for their own benefit and not for the benefit of third parties (the beneficiaries). There have been a number of Court judgements where...

How do people still use a trust as a tax planning vehicle?

The advantages of proper tax planning in a well-structured trust are clearly defined in the tax legislation. Even minor beneficiaries can enjoy tax-friendly distributions. Estate planners use the following principles in structuring their financial affairs to enjoy...

Divorce: should trust assets be included in a spouse’s estate?

In this article, one of a series on trusts for Personal Finance and its sister publication, Business Report, Phia van der Spuy looks at what you can do to protect trust assets from division in the event of divorce. TRUSTS are excellent vehicles for asset protection,...

Marital regime may affect divorce claims if you have a trust

Almost half of all marriages end in divorce. It is also a reality that former-spouses-to-be usually attack trusts set up by their spouses in an attempt to maximise their divorce claims. Apart from being emotionally traumatic, divorce can often have a severe impact on...

Does a trust require the appointment of an independent trustee?

In the context of estate planning, a trust can be described as a legal relationship that has been created by a person (known as the founder or donor) placing assets under the control of another person (known as the trustee) either during the founder’s lifetime (an...

OPINION: As the guardians of a trust, it’s key to act jointly

JOHANNESBURG - I met a trustee a trust last week, who was confident he could manage “his” trust alone, as a result of a resolution he got signed by all trustees, which empowers him to do as he wishes with the trust’s assets. Such a red flag was raised, as many people...

The drawbacks of a free will

CAPE TOWN - Are you happy to get a free will from a so-called professional? Is there really such a thing as a free product, or are you signing up for a future cost? The saying goes, “if it seems too good to be true, it probably is”. It is no different with a free...

What rights do trust beneficiaries have?

Many people set up trusts without applying their minds. Trust practitioners often also do not apply their minds and guide their clients. They use a standard trust deed template, simply changing the name of the trust and the names of trustees, and use a standard...

Where are we with taxes and trusts after the Budget speech?

All About Trusts The wealthy were holding their collective breath before this year’s Budget, knowing that the government was desperate to plug a hole in its revenue and create a more equal society, and that it would increase taxes to meet these objectives. The...

OPINION: #Budget2018 coming down harder on wealthy

JOHANNESBURG - If you didn’t have the chance to listen to the Budget speech, the news is that this year you can in fact be glad you have a trust. The change in the VAT rate is from 14percent to 15percent. It is apparent that the government started coming down harder...

Which types of assets should go into a trust?

All About Trusts Historically, people whose estates have been potentially liable for estate duty have been advised to move – often on an interest-free loan account – all paid-up personal assets into their family trusts in order to save on the duty. However, if the...

When a trust is an extension of yourself

Is your trust your alter ego (an extension of yourself)? If so, it may exist, but it will be disregarded, and the assets will be treated by the court as if they belonged to you! An alter ego trust occurs where the necessary requirements for a valid trust are present...

OPINION: Make an effort to know the contents of your trust deed

JOHANNESBURG - Have you ever read your trust deed? It is astonishing how many people have placed their entire wealth into trust structures, but have never even made an effort to confirm that their contents are factually correct, expressing their wishes properly, and...

Differences between a living trust and a will trust

CAPE TOWN - When people seek estate planning advice, they may be advised to consider a trust. However, people are advised to avoid the hassle of establishing a trust while they are alive (a living, or inter vivos, trust) and instead have a trust registered upon their...

OPINION: How a trust could fit into your estate planning

JOHANNESBURG - If you knew you were going to die tonight, would you know what the estate duty implications would be in your estate? Would there be enough cash or liquidity in your estate to pay the various costs that would arise? Are your assets as a business owner...

You don’t have to lose all control over assets in a trust

Many people are wary of trusts because they worry that they will lose control over their assets. This fear is often exacerbated by professionals who advise that clients should not be seen to be involved in the administration of their trusts. Some professionals even...

OPINION: Establishing a trust remains a personal decision

  JOHANNESBURG – Should I have a trust: Yes/No? Advantages Given the South African Revenue Service’s (Sars’s) drive to tax the wealthy (irrespective of whether it is an individual, a company or a trust), a lack of understanding of trusts, the current...

What exactly is a trust?

Why are so many trusts in trouble? When people are advised to structure their assets in a trust, they are often not informed about the uniqueness of a trust as an estate-planning vehicle. This ignorance may result in trusts being exposed at some stage, such as when...

OPINION: Debunking the common myths about trusts in SA

JOHANNESBURG - There are many misconceptions that surround trusts, to the point that the word "trust" has become something of a swear word in many conversations. Trusts were extremely popular in the eighties and nineties, but this is no longer the case. The SA Revenue...

OPINION: Business Report offers much more to the readers

CAPE TOWN - Much has been published in the media of late regarding the use of trusts in South Africa and their perceived relevance, all amidst ongoing attacks from SARS. Many estate planners are in the dark, especially because many have never made an effort to...