A Protector is a person whose prior consent is legally required ahead of a Trustee (in the case of Trust) or Council (in the case of a Private Interest Foundation) doing certain key things.
For example the Protector’s permission may be required prior to:
- the Trustee/Council adding or excluding Beneficiaries; and/or
- the Trustee/Council making/paying distributions (or changing previous arrangements for the) of income/capital; and/or
- removing or adding Trustees or Councillors etc.
A Protector is usually appointed in writing at the time a Trust or Foundation is established. Additionally subject to the Trust deed or Foundation regulations a Protector (as nominated by the Trust or Foundation creator) may be appointed at a later time.
it is not mandatory to appoint a Protector. Also if one is appointed the matters in respect of which the Protector’s permission are required should be limited and specific otherwise there is a risk that the Protector may be deemed to be controlling the Trust/Foundation from onshore (which could result in the Trust or Foundation as the case may be becoming liable to local taxes).
The type of persons who might be appointed as Protector would include your Financial Adviser, your Lawyer, a senior family member (eg the family matriarch) or your most trusted friend or ally.
Note: You don’t have to appoint a Protector from the start; one can always be added later.
