A private trust is a trust where the beneficiary (the person or entity which receives the equitable title in the property) is private and non-charitable. Thus, this is opposed to a charitable trust, which has charitable beneficiaries. The distinction between private trusts and charitable trusts, while obvious, is necessary because there are certain requirements and conditions which apply to one but not the other. Private Trusteeship are set up for the maintenance, education and benefit of children and grandchildren. The main aim is to provide for the day-to-day needs of the beneficiaries and for the payment of their educational costs.
Trust Benefits :
Assets and monies are properly invested
The Trustee manages, and administers the Trust Assets independently
Trust Fund monies are utilized for intended beneficiaries
The terms of distribution are decided by the Settler (owner)
Parents of young children and key providers should set up this Trust
A life assurance policy can be absolutely assigned to us and create an Insurance Trust instantly in favor of the spouse and/or children named as beneficiary in the policy. The policy money does not form part of the estate of the assured and consequently no Grant of Probate or Letter Administration is required in making claim when the assured dies. Further more, the money payable under such a policy is protected against creditors subject to Section 52 of the Malaysian Bankruptcy Act.
Any one who has invested in an insurance policy and has dependents should set up this trust.
Download “The role of a Trust Company” here.