Trust Companies

Protective Testamentary Trusts

Persons suffering certain disabilities may be statutorily entitled to government benefits. However, this entitlement could be jeopardized if their assets or income exceed a certain threshold. Great care must be taken in structuring and administering such a trust to maximize the other benefits to which he or she may be entitled, while at the same time ensuring that the beneficiary will be properly provided for. Because the entitlement to family benefits depends, in part, on the value of the disabled person’s assets, the terms of a classic “Henson” trust are structured so as to provide the trustee with absolute discretion in the payment of either income or capital to or for the beneficiary. The completely discretionary nature of the trust ensures that the beneficiary is at no time entitled to compel the trustee to make payments to him or her. Since no interest in the trust assets vests in the beneficiary unless and until discretionary payments are made, the Henson decision confirms that such an entitlement does not affect the calculation of the beneficiary’s assets. As a result of the amendments introduced by the Ontario Disability Support Program Act 1997, a testator or settlor may set aside $100,000 in trust capital during the lifetime of the beneficiary. All the income from which may be paid to the beneficiary for disability-related expenses without jeopardizing the entitlement to government benefits.

Advantages of a Trust company acting as a corporate Executor and Trustee:

  • Full attention to your estate needs.
  • Continuity of service during the full period of estate administration.
  • Accessibility to the Trust Officer in charge and ready to assist your beneficiaries.
  • Impartiality ensures fair and tactful treatment of each beneficiary.
  • Even Hand Rule ensures proper protection of both the Trust Assets and the beneficiaries.
  • Confidential nature of estate business.
  • Skill and experience allows the highly trained professionals to administer estates efficiently and economically.
  • Accounting procedures in place to prepare acceptable court statements.
  • Knowledge and specialization dealing with Trusts, investments, tax matters, and insurance.
  • Group judgment and the experience of senior officers.
  • Financial responsibility of a well established Trust institution.