An advantage of this BC agreement allows the legitimate ownership of real estate to change ownership without attracting capital gains taxes as long as the economic beneficiary remains the same, since the transfer of the property is not a „tax“ for income tax purposes. Another widespread use of bare trusts was the prevention of the payment of property transfer tax (TTP). Since BC`s PTT structure attracts ptT only when the right is transferred to a new owner, the parties are able to avoid paying PTT entirely by applying cash fiduciary agreements to separate the legal and economic property reserve from the property. As long as only the useful interest in the bare trust property is transferred, there is no PTT to pay. The ability to transfer advantageous interest to real estate and avoid ptT was a powerful tool for planning real estate and tax in PRE JESUS CHRIST. Regardless of the underlying purpose of a trust and regardless of the value and extent of the assets that directors hold for beneficiaries, all trusts share three essential characteristics: the NDP government announced last fall that it would use bare trusts for the specific purpose of circumventing the land transfer tax 1. A trust is a particular type of legal relationship, often established in writing, that allows a responsible person (the „agent“) to hold property in the name of one or more other persons (the „beneficiaries“). Trusts are often created or „populated“ by a person (the „Settlor“) by establishing a document of trust during that person`s lifetime (an Inter Vivos Trust) or by a will with certain conditions that must apply after the death of the will craftsman (a „Testamentary Trust“). Inter Vivos and Testamentary Trusts are used as means of controlling the management and distribution of assets and are an instrument to minimize taxes, minimize disputes between family members and restrict access to funds for certain beneficiaries through the establishment of a means of control.
These particular types of trusts are considered separate entities and must therefore file their own annual income tax returns. In other cases, a trust can be used more easily to express an advantageous division of ownership, and there are no separate tax returns required (this is a „trust“). Trusts can also be created through the application of the law („constructive trusts“). There are two aspects of owning real estate (real estate or other) (1) legal property (which is called as owner); and (2) the economic beneficiary (who receives the financial benefits and expenses of the property).