It is straightforward to set up a family trust in Canada. It requires a simple three-step process. Provided that you have all the necessary documentation and are working with an expert wealth advisor or tax lawyer, it can be done quickly and with minimal fuss. First, let’s take a look at the family trust setup process.
Step 1: Draft a trust document
The first thing you need to do is draw up the trust agreement. In this document, you designate yourself as the settlor/ grantor, nominate your trustees, and name all the trust’s beneficiaries. The document also outlines how the trust and its assets should be managed and directs the division of assets among the beneficiaries.
Step 2: Set up your family trust
Once the agreement is drawn up, it will need to be signed by you and the trustees in the presence of a witness. This essentially brings the trust into existence, except for one final step: funding the trust.
Step 3: Move your assets into the trust
Finally, all the assets you wish to be owned by the trust must be transferred from your ownership into that of the trust. This is usually done in the form of an irrevocable donation. It is not strictly necessary to move all the applicable assets into the trust at one time. All it takes to get the trust running is having at least one asset or sum of money to be transferred. Once this happens, and a bank account is set up in the name of the trust, the trust is essentially up and running.
Nour Private Wealth (NPW) is a Canadian company with a team of wealth advisors servicing clients across seven provinces. We are committed to helping high net-worth families and individuals manage their wealth, grow their assets and plan their estates for a tax-efficient transfer. Contact us today for more information on setting up a family trust and what is required to get the process underway.