A family trust is a trust:
A) which holds a collection of assets on behalf of various non-family members.
B) from which income is distributed to the family members according to their respective unit holdings in the trust.
C) that has a variety of investments in equity, property and cash management.
D) which provides the trustee with discretion, according to the trust deed, over who receives distributions from the trust.

Question

Quizplus · Accepted Answer

A family trust is established to manage and distribute assets for the benefit of a family. The trustee has discretion, as defined in the trust deed, to decide who receives distributions from the trust. Option A is incorrect as a family trust is specifically for a family. Option B may be true in certain cases, but the distribution of income is subject to the terms of the trust deed. Option C may also be true, but not all family trusts necessarily have a variety of investments in equity, property and cash management.

A Family Trust Is a Trust