A trust is a legal arrangement that will benefit people who wish to privately structure their affairs, or who wish to control assets without actually owning those assets, or, in some circumstances, who wish to take advantage of certain tax-planning opportunities.
Trusts are used in many different circumstances and come in different flavours. Anyone who has an RRSP or a RRIF has a trust. Our main use of trusts is for advanced corporate structuring. Trusts are used in corporate structuring to better protect your assets from future creditors. Trusts empower you to better deal with future financial difficulties. Additionally, trusts allow you to transfer shares in your corporations to other family members without losing control.
The main benefits of having a Canadian family trust are:
A trust is created when a settlor transfers a specific item of property to a trustee to hold for the benefit of identified beneficiaries. It is best practice that a trust arrangement be recorded in writing, but it is possible to create a trust by conduct.
Each province in Canada has different rules about things like the duration of the trust and whether or how long a trust may "accumulate" income inside the trust before it must pay out that income to beneficiaries. For example, in British Columbia, a family trust may have a maximum life of 80 years. In other provinces, the maximum life is 21 years.
To create and maintain a family trust in Canada, you'll need people to fill three main roles -- settlor, trustee, and beneficiary -- and in some trusts, a fourth role -- protector -- is added.
The easiest way is to fill out and send us the Family Trust Instructions Form
Usually it takes a week or two to set up a trust, depending on the time it takes to send instructions back and forth
Ready to start? Download our Family Trust Instructions Form
INC Business Lawyers Tip!
All living trusts are designed to avoid probate. Some may help you reduce estate taxes