Setting up Trusts
What is a trust?
Setting up a trust lets you transfer your assets to a trustee (an asset holder) for the benefit of your beneficiaries (typically your spouse and children). This reduces your liability for inheritance tax and ensures your assets go to the people you want to inherit your estate.
Trusts are an excellent way to control and protect your assets, especially when the beneficiaries are too young, ill or irresponsible to manage them themselves. You can set up trusts during your lifetime or write them into your Will so they come into effect after you die.
At Richardson’s Wills, we specialise in Flexible Life Interest Trusts and Discretionary Trusts.
“Dealing with these types of formalities is always easier and less formal at home, and you were able to answer our questions with ease and confidence.”
Jane & Philip Grant (Cadbury Heath)
Flexible Life Interest Trust
With a Flexible Life Interest Trust, a beneficiary is given a life interest in your estate. This means they’re entitled to receive all income and capital from your assets.
Setting up a Flexible Life Interest Trust allows you to:
- Protect your estate even if the beneficiaries go into care or declare bankruptcy.
- Ensure your estate doesn’t affect the size of your beneficiaries’ estates, which would increase their inheritance tax.
- Give the life tenant the power to make gifts during their lifetime to reduce payable inheritance tax.
Rather than passing your estate onto your spouse or children, a Discretionary Trust allows assets to skip generations. This lets you put assets aside for grandchildren who might not otherwise benefit.
Setting up a Discretionary trust allows you to:
- Avoid leaving your inheritors with a large inheritance tax bill, which might affect their other benefits.
- Protect your beneficiaries against additional tax from assets that are expected to increase in value.
- Lower the taxable value of your home by splitting ownership between your beneficiaries and the trustee.
Set up a trust with Richardson’s Wills
Trying to set up a trust without detailed legal knowledge might mean that your assets don’t reach your chosen beneficiaries. But the knowledgeable and experienced legal professionals at Richardson’s Wills make the process simple and tax efficient. We listen closely to your wishes to give you the best legal advice possible, and save you time and money by completing the trust registration.
To discuss which trust would be most appropriate for your assets and beneficiaries, contact us today for a free consultation.