Parties of the Trust: The Beneficiary

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When the Trust Deed is drafted, Beneficiaries or categories of Beneficiaries must be named. In doing so, the Settlor outlines who they wish to benefit, or to be eligible to benefit from the Trust. The Beneficiaries may benefit from:

The income of the trust e.g. property rental or investment income,
The capital of the Trust e.g. getting assets distributed to them under specific circumstances, or
Both income and capital.
Remember, Trustees are normally excluded from benefitting, although as stated above, malaysia mobile database Professional Trustees can receive reasonable remuneration. There are types of Trusts where the Settlor can retain an automatic interest to the income during their lifetime, for example an Interest in Possession Trust – This will be discussed in the next article.

Choosing the Beneficiaries or categories of Beneficiary can be a tricky exercise for the Settlor, who must weigh up various considerations, such as:

Is the Settlor married?
Does the current spouse need access to the fund?
Does the Settlor have a former spouse?
Does the Settlor have children?
Does the Settlor have children from a previous relationship?
Is anyone financially dependent on the Settlor?
Does the Settlor have any vulnerable dependents?
Who does the Settlor find deserving?
Are there any not-for-profits/charities that are close to the Settlor’s heart?
The Trust Deed can also include exclusions, which can detail anyone who the Settlor does not wish to be considered.