discretionary trust


discretionary trust
1) A trust in which the shares of each beneficiary are not fixed by the settlor in the trust deed but may be varied at the discretion of some person or persons (often the trustees). In an exhaustive discretionary trust all the income arising in any year must be paid out during that year, although no beneficiary has a right to any specific sum. In a nonexhaustive discretionary trust (or accumulation trust), income may be carried forward to subsequent years and no beneficiary need receive anything. Such trusts are useful when the needs of the beneficiaries are likely to change, for example when they are children.
2) In the USA, an investment trust in which the managers can decide what investments to make.

Accounting dictionary. 2014.

Look at other dictionaries:

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  • Discretionary trust — Wills, trusts and estates …   Wikipedia

  • discretionary trust — In the context of mutual funds, refers to a mutual fund or unit trust whose management decides on the best way to use the assets without restriction to a specific type of security. Bloomberg Financial Dictionary In the context of trusts, refers… …   Financial and business terms

  • discretionary trust — 1) A trust in which the shares of each beneficiary are not fixed by the settlor in the trust deed but may be varied at the discretion of some person or persons (often the trustees). In an exhaustive discretionary trust all the income arising in… …   Big dictionary of business and management

  • discretionary trust — An anomalous term from the standpoint of absolute discretion in the trustee, since unbridled discretion in a trustee negatives the necessary separation of legal and equitable ownership. Best defined as a trust in which a broad discretion is… …   Ballentine's law dictionary

  • discretionary trust — /dɪsˈkrɛʃənri trʌst/ (say dis kreshuhnree trust) noun Law a trust in which the trustees have absolute discretion as to the application of the trust capital and income (opposed to a fixed trust) …   Australian English dictionary

  • discretionary trust — noun a trust that gives the trustee discretion to pay the beneficiary as much of the trust income as the trustee believes appropriate • Hypernyms: ↑trust …   Useful english dictionary

  • non-discretionary trust — n.    a trust in which the trustee is directed to invest only in specifically named securities and to diversify the investments among certain types of securities. The trustee has no discretion or personal decision making power in the matter.… …   Law dictionary

  • Discretionary trusts and powers in English law — are elements of the English law of trusts, specifically of express trusts. Express trusts are trusts expressly declared by the settlor; normally this is intended, although there are situations where the settlor s intentions create a trust… …   Wikipedia

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