Any trust established by a Will is called a testamentary trust and indeed, a Will itself is a form of trust regardless of its simplicity or complexity. Testamentary Discretionary Trusts (TDT’s) are a type of testamentary trust that are gaining increasing popularity, and which are effectively a discretionary trust (similar to a family trust or a trust set up during a person's lifetime) established under a Will. TDT’s can be very flexible structures and can be customised to suit the objectives and needs of the individual or family in question. Although there are both taxation and asset protection advantages associated with a TDT, it is important to remember that the taxation advantages should be regarded as secondary to the asset protection advantages.

Greg Cox, Special Counsel

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