A life interest is some form of right, usually under a trust

Trust law

In common law legal systems, a trust is a relationship whereby property is held by one party for the benefit of another...

, which lasts only for the lifetime of the person benefiting from that right. A person with a life interest is known as a life tenant.

A life interest ends when the life tenant dies.

An interest in possession trust

Interest in possession trust

An interest in possession trust is a form of legal arrangement which gives a person a "present right to the present enjoyment of something". At least one of the beneficiaries of this type of trust will have the right to receive the income generated by the trust or the right to enjoy the trust...

is the most common example of a life interest trust. In a typical interest in possession trust, the life tenant receives all the income

Income

Income is the consumption and savings opportunity gained by an entity within a specified time frame, which is generally expressed in monetary terms. However, for households and individuals, "income is the sum of all the wages, salaries, profits, interests payments, rents and other forms of earnings...

 from the trust

Trust law

In common law legal systems, a trust is a relationship whereby property is held by one party for the benefit of another...

 for the rest of his or her life. On the life tenant's death

Death

Death is the permanent termination of the biological functions that sustain a living organism. Phenomena which commonly bring about death include old age, predation, malnutrition, disease, and accidents or trauma resulting in terminal injury....

, the trust comes to an end, and the capital

Financial capital

Financial capital can refer to money used by entrepreneurs and businesses to buy what they need to make their products or provide their services or to that sector of the economy based on its operation, i.e. retail, corporate, investment banking, etc....

 of the trust is paid to another person, known as the remainderman

Remainderman

A remainderman is a person who inherits or is entitled to inherit property upon the termination of the estate of the former owner. Usually this occurs due to the death or termination of the former owner's life estate, but this can also occur due to a specific notation in a trust passing ownership...

, as specified by the trust document.

One form of life interest is a life estate

Life estate

A life estate is a concept used in common law and statutory law to designate the ownership of land for the duration of a person's life. In legal terms it is an estate in real property that ends at death when there is a "reversion" to the original owner...

, an ownership interest in property which lasts for the life of the party to whom it has been granted. Unlike the beneficiary of a trust, the owner of a life estate in property has the right to actual possession of the property itself, and may use it as any other owner, subject only to a duty to avoid waste

Waste (law)

Waste is a term used in the law of real property to describe a cause of action that can be brought in court to address a change in condition of real property brought about by a current tenant that damages or destroys the value of that property...

 of the property value affecting parties with a future interest

Future interest

In property law and real estate, a future interest is a legal right to property ownership that does not include the right to present possession or enjoyment of the property. Future interests are created on the formation of a defeasible estate; that is, an estate with a condition or event...

.