What Is The Trust Agreement Called

It is clear from the above statement that, in such a situation, it is not clear that the intention to build trust is certain. The Department also stated that, given the requirement of the three certainties, “a written trust document would serve as better evidence of their existence and resolve any ambiguities that might otherwise arise.” Until recently, there were tax benefits for living trusts in South Africa, although most of these benefits have been eliminated. Protecting assets from creditors is a modern advantage. With notable exceptions, the trust`s assets are not held by the directors or beneficiaries, the creditors of the trustees or beneficiaries may not be entitled to the trust. Under the Insolvency Act (Law 24 of 1936), assets transferred to a living trust remain threatened by external creditors for 6 months if the debtor owner is solvent at the time of the transfer, or 24 months if they are insolvent at the time of transfer. After 24 months, creditors are not entitled to assets in the trust, although they may attempt to add the credit account, forcing the trust to sell its assets. Assets can be transferred to the living trust by selling them to the Trust (through a loan to the Trust) or by giving money (each individual can give R1000 R1000 per year without collecting tax on donations; 20% of the tax on donations apply to additional donations in the same tax year). There are two types of trusts: inter vivo and will. The will trust arises from the death of an individual and can be founded under the same will. Inter vivo trusts are created while Settlor is alive. These trusts are generally divided into two categories: formal and informal.

Formal trusts are created through a written trust agreement, while informal trusts do not contain a written trust agreement. A living trust, sometimes called The Inter vivos Trust, is a Trustor (Grantor) which, during its lifetime, is appointed by an agent (Grantor) with assets or assets intended for the use of the individual throughout his life.