Frequently Asked Questions Trusts
What is a Trust?
A Trust is an arrangement through which assets are administered for the benefit of beneficiaries.
Why do I need a Trust?
A Trust is very flexible and the reason for the creation thereof can be very diverse. It is therefore very important to take advice from a qualified professional in order to ensure that a trust is suited to your particular needs.
Where do I start setting up a Trust?
The first step is to contact one of our Fiduciary Consultants who will guide and advise you on the way forward. Contact us at [email protected] to guide you on establishing a Trust.
What is a trustee?
A trustee is the person/entity that administers the trust assets for the benefit of the beneficiaries and in accordance with the provisions of the trust deed.
What is a ‘founder’?
The Founder, also referred to as the Donor is the person who established the Trust.
Why use a Corporate or Independent trustee?
Trust law, and the relevant tax law aspects, are very complicated and non-compliance can have severe consequences; a Corporate Trustee / Independent Trustee will ensure that the Trust is administered in a prudent and compliant manner. A Corporate Trustee also ensures continuity across generations and will ensure that the Trust is administered in accordance with the wishes of the founder long after his/her passing. Furthermore, the core idea of a Trust is the separation of control and benefit: the employment of an Independent Trustee further ensures compliance with this principle.
What are the duties of a trustee?
The trustee holds a fiduciary position and is held to a higher standard than that of an ordinary person. A trustee must act with the utmost good faith and must adhere to the provisions of the trust deed and relevant trust law principles.
What is the Master of the High Court?
The Master of the High Court is the government entity that exercises an oversight role over trustees in South Africa.
What is a Letter of Authority (LOA)?
No person may act as a trustee without being properly appointed as such by the Master of the High Court. The Letter of Authority is the document that is issued by the Master of the High Court which confirms the appointment of a person as trustee in a particular Trust.