Family trusts are frequently established to facilitate tax efficient intergenerational asset transfers, to protect assets and or to maintain or guide control of assets being transferred.
A Family Trust provides an effective mechanism of transferring taxable income from high income earners, at high marginal tax rates, into the hands of family members subject to lower tax rates. Family Trusts can also be used to protect assets from creditors as family assets are owned by the trust not the individual.
Trusts can also be structured to confer asset ownership at set intervals in the future, which can be an attractive option for families with young children or with grown children not yet fully established in their careers.
For health and security considerations, a trust can offer a mechanism to provide financial support and care for family members with serious disabilities or other ailments.