TSEM1032 – Introduction to trusts: bare or simple trusts: giving advice

It is up to the trustees to establish whether a trust is bare. If the trustees have access to legal advice they should ask their legal adviser whether the trust funds have ‘indefeasibly vested’ in the beneficiaries. If they have then the trust will be a ‘bare trust’.

In other circumstances the trustees will need to consider carefully the terms of the trust that they are administering. Does the trust

• impose conditions that must be fulfilled before the beneficiaries become entitled to the trust funds, or
• does it merely defer payment until the beneficiary reaches a particular age?