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Family Trusts in Canada

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.


Uses Of A Family Trust


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.

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Benefits of a Family Trust


The main benefits of having a Canadian family trust are:

  • Privacy: Trusts are created by written agreements, known as deeds or trust settlements or even simply trusts. They usually don't have to be registered anywhere. They're valid as soon as they are signed.
  • Asset Protection: In a sense, a trust arrangement allows you to have your cake and eat it. Because a trustee is only a legal owner of the trust property, he can say "I don't own it". And because the trust document does not necessarily give the trust property outright to a beneficiary, the beneficiary can also say "I don't own it, either". This sort of benefit is directly useful for asset protection.

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Creating and Designing a Family Trust


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.

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People Required For Your Trust


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.

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4 Steps to Setting Up a Family Trust


  1. Proposed Trust Name: A Family Trust name generally consists of the family name, "Family Trust", and the year in which the trust was created. The year is included in order to remind you about the 21-year rule.
  2. People: 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. It is possible for the same person to act as settlor, trustee and even beneficiary. But because of those certain tax rules mentioned earlier, this is not usually a wise structure (except in the specific case of the alter ego trust).
  3. Structure: First you must decide on the purpose of the family trust. Generally a trust is created in order to own a corporation, as corporations have a lower tax rate than trusts.
  4. Go ahead: Lastly, confirm with us that you wish to go ahead with the creation of your family trust.

The easiest way is to fill out and send us the Family Trust Instructions Form


How long will it take to set up my Family Trust?


Usually it takes a week or two to set up a trust, depending on the time it takes to send instructions back and forth


Our Standard Family Trust Package Includes:


  • A legal compliant Family Trust.
  • A complete Family Trust records book, to keep better records of your Family Trust, and to make it easier for you to instruct accountants and the like in the future.
  • Legal advice with respect to forming your Family Trust.
  • Choice of trust structure designed to suit your needs.

Contact Us Today to Order

Ready to start? Download our Family Trust Instructions Form

Added Bonus: - Easy access off Highway 99 - Lots of FREE parking!