A discretionary trust is also known as a family trust. This is signiﬁcant because the beneficiaries are all, or predominantly, members of the same family. The name ‘discretionary trust’ is derived from the role performed by the trustee.
Using a discretionary trust enables income to be distributed to companies and trusts associated with family members. A discretionary trust enables income with different tax characteristics to be streamed to family members individually. The structure can also be applied to non-family beneﬁciaries.