Chris Thorpe looks at how trusts could potentially be used for tax and general purposes.
Trusts are often mis-trusted (excuse the pun!); they are seen as being vehicles of fraud, dodgy dealings and generally something to be avoided.
Whilst they could indeed be used for such ends (just as limited companies and any other structure might), trusts are more often used as a perfectly innocuous means of holding assets for other people.
What are they?
Essentially, they are formed when the legal ownership of an asset is separated from the beneficial ownership, i.e., a legal owner (the trustee) holds it ‘on trust’ for another person (the beneficiary) who benefits from it (e.g., occupies the property or receives income from it). The person who establishes (settles) the trust is the ‘settlor’ – they can do this by transferring the legal
