Testamentary Trust

A trust created by a will and which takes effect upon the death of the testator.

A trust which is to take effect only upon the death of the settlor and is commonly found as part of a will.

An executor of a will is a trustee.

There are virtually no wills that do not entail the existence of a testamentary trust. An executor will always need some time to collect the assets of the deceased and to distribute them to the beneficiaries; and during that time period, a testamentary trusts exists.

Many wills explicitly create trusts by demanding of the executor that he/she invest any money destined to a minor and to hold that money "in trust" and to not distribute it to the minor until the minor attains the age of majority, or some other age as chosen by the testator.

Trusts which take effect during the life of the settlor are called inter vivos trusts.

Canada's Income Tax Act defines a testamentary trust as arising "on and as a consequence of the death of an individual".