Trusts can be immensely useful when putting away money for an individual or cause as they can yield significant savings when tax time arrives, says Brian Cohen, a partner with the Toronto office of Borden Ladner Gervais LLP who has extensive experience in personal taxation, including inter-generational tax-planned gifting.

'For tax purposes, trusts are treated as individuals and are taxed only on their income,' Cohen says. 'So, the trust pays taxes on its income at what’s most likely a marginal rate – like about 17 per cent – instead of that being put upon your income, which is going to be taxed at a much higher rate.'