Asset Protection and Trusts

Commercialista8

A trust is a legal instrument with the objective of safeguarding property and assets. There are many possible uses of a trust:

  • Asset Protection: a trust is often set up to protect property. One of the consequences of a Trust is the segregation of the allocated assets so that they will be immune to any detrimental event that personally involves one or more figures involved in the Trust. Because of this very useful feature, a Trust is increasingly used to separate and protect personal assets from company assets or to protect subjects whose assets may be compromised by risky professions (doctors, lawyers, civil servants etc.) or simply by reckless personal behaviour (gambling, drugs and alcohol, etc.).
    Furthermore, through a Trust, the problems that arise for unmarried couples, for whom Italian law provides no defence mechanisms, can be remedied.
  • write-593333_1920Discretion: the provisions of a Trust may be reserved, and this can be a sufficient reason for establishing one.
  • Protection of minors and persons with disabilities: often, as has been seen, testamentary provisions stipulate that minors have limited enjoyment of possessions until they reach the age of majority, or that persons with disabilities may make use of possessions in Trust without being full owners of them.
  • Protection of assets for successional purposes: often, a trust is established with the aim of protecting an asset in an intergenerational transfer or from squandering by persons unable to administer it.

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