10 things you Absolutely need to know about Bare Trusts
Check your answers
1. A Bare Trust is one in which:
A) The beneficiary Is entitled to income and may receive capital once they attain 21
B) The beneficiary is entitled to capital and may receive income once they attain 25
C) The trustees can decide when the beneficiary will benefit
D) The beneficiary has an immediate and absolute title to both income and capital
2. The test of a Bare Trust according to HMRC is whether the trust funds have:
A) Indirectly vested in the beneficiary
B) Independently vested in the beneficiary
C) Indefeasibly vested in the beneficiary
D) Ideally vested in the beneficiary
3. If a parent dies and minor children benefit under intestacy then a statutory trust arises. Is this a Bare Trust?
A) Yes always
B) No never
C) Yes in England and Wales only
D) Yes in Scotland & Northern Ireland only
4. If a Bare Discounted Gift Trust has been set up, can adult beneficiaries demand their share of the trust fund while the donor is still alive?
A) Yes always
C) Only if Scots law applies
D) The trustees can distribute part of the trust fund if the donor’s rights to the pre-selected payment stream aren’t adversely impacted.
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