What is a domestic trust?

A domestic trust is a legal arrangement established under the laws of a specific country, typically where the grantor (the person creating the trust) resides. It is designed to manage and distribute assets for the benefit of designated beneficiaries, such as family members or charities. Domestic trusts are subject to the tax laws and regulations of the country in which they are established, impacting how income and gains are taxed. Essentially, they provide a framework for asset management and estate planning within the jurisdiction's legal system.