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What is an income trust fund?


What is and what's the purpose of an income trust fund?

An income trust fund is set-up for tax planning purposes as they are taxed at a lower rate. In Canada they are generally floated with long-life assets which contribute a steady stream of distributions. Some Income Trusts pay out in excess of 95% of earnings in distributions. Alot of oil and gas companies are setting up Income Trusts and transferring in stable, producing properties and leaving out the exploration and development properties.

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