Types of Trusts 

What is a Discretionary Trust?
A discretionary trust, sometimes called a family trust, is established by a Deed between the person who sets up the trust (the settlor) and a Trustee. In a discretionary, or family trust, the Trustee has the power to choose at his or her own discretion whether any sum is to be paid to beneficiaries, and if so, how much. Read More

What is a Unit Trust?

A unit trust tends to be a fixed, express trust where beneficiaries and their interests are identified by the proportion of “units” that they hold. Unit trusts are common for property and investment trusts and joint ventures and were developed for commercial type ventures where a readily transferable interest in the trust is desired. Read More

What is the difference between a Discretionary Trust and a Unit Trust?

The key difference between these two types of trusts is that with the discretionary trust, it is the trustee who chooses which beneficiaries will receive interest and how much interest they will receive. In contrast, with unit trusts, it is the beneficiaries who choose how much interest they wish to invest and therefore determine the proportion of “units” that they want to hold.

What is a Hybrid Trust? 

A Hybrid Trust is a combination of both a Discretionary/Family Trust and a Unit Trust.

Within a Hybrid Trust, the trustee is given the power to distribute trust income and capital among a nominated class of beneficiaries (similar to a Discretionary/Family Trust). The income and capital is distributed part in a proportional method (like a Unit Trust) relative to the number of units held by each beneficiary and part in a discretionary method. Read More

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