Tax planning opportunities with 'bare' and 'secret' trusts

As its name implies, a 'bare' trust is closely akin to naked ownership. A bare trust is 'no trust at all' and the beneficiary of a bare trust has an absolute interest in the property held under the bare trust. Certain individuals, such as minors, cannot legally own property because of a deficiency in their legal personality. Therefore, a gift made to a minor must be held in the name of a person who can legally own the property acting as a bare trustee for the minor. In the UK, bare trusts have been widely used by parents and grandparents for school and university fees planning. If the p...