Articles on: Trusts

What is a beneficiary?

Beneficiaries are individuals or entities designated to receive trust distributions, such as income or assets.

Beneficiaries have certain rights and interests in the trust assets. A trust deed usually outlines these rights, including the right to receive income, the right to request information about the trust, and the right to challenge trust actions that may adversely affect them.

Common types of beneficiaries

Primary beneficiariesIndividuals or organisations named explicitly in the trust deed to receive a benefit emanating from the trust.
Contingent BeneficiariesEntitled to benefits under specific conditions, such as if the primary beneficiaries are deceased, unable to be located, or refuse their inheritance at the time when the proceeds are to be paid.
Income beneficiariesEntitled to receive income generated by the trust assets.
Capital BeneficiariesEntitled to receive distributions of the trust's capital.
Discretionary BeneficiariesThe trustee has discretion in determining which beneficiaries receive distributions and how much they receive.

Updated on: 08/04/2024

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