A discretionary trust is
A)a trust which holds a collection of assets on behalf of various parties rather than family members.
B)a trust from which income is distributed to the parties according to their respective unit holdings in the trust.
C)a trust that usually concentrates on a particular investment such as equity,property or cash management.
D)a trust which provides the trustee with discretion,according to the trust deed,over who receives distributions from the trust.

Question

Quizplus · Accepted Answer

A discretionary trust is a type of trust in which the trustee has the discretion to determine how trust income and/or capital is distributed among the beneficiaries. The distribution of income or capital is not predetermined by the terms of the trust, but rather is left to the discretion of the trustee. This means that the trustee can decide whether or not to make distributions to beneficiaries, and can also determine the amount of the distribution and the timing of the distribution.

A Discretionary Trust Is