A non-discretionary trust, also known as a mandatory trust, is a type of trust in which the trustee is legally obligated to follow specific instructions provided in the trust document. Unlike a discretionary trust where the trustee has the discretion to distribute assets, in a non-discretionary trust, the trustee must distribute assets according to predetermined terms and conditions outlined in the trust instrument. This type of trust provides less flexibility to the trustee but offers beneficiaries greater certainty regarding the management and distribution of trust assets.
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This glossary post was last updated: 29th March 2024.
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