Contact us today to discuss your requirements (evening appointments available): 01732 525800/ info@protectedlifeplanning.co.uk

Estate Planning & Trusts

What is a Trust?

A Trust is a legal method / process of managing your assets (money, investments, land or buildings). There are different types of trusts and they are taxed differently. The key participants are:

the ‘settlor’ – the person who puts assets into a Trust

the ‘trustee’ – the person who manages the Trust

the ‘beneficiary’ – the person who benefits from the Trust

Trusts are set up to:

control and protect family assets and handle the affairs of someone who is considered too young
handle the affairs of someone who is incapacitated
pass on assets while you’re still alive
pass on assets when you die (a ‘Will Trust’)

Will Trusts

Will trusts are mainly used by married couples/joint owners of main residence and civil partners and are set up in conjunction with splitting the ownership of the family home to, ‘tenants in common’, so each partner has 50%.

Tenants In Common – Property Trusts

Will trusts are mainly used by married couples/joint owners of main residence and civil partners and are set up in conjunction with splitting the ownership of the family home to, ‘tenants in common’, so each partner has 50%.

Joint ownership means that property ownership goes to one another at the time of death at 100%. Tenants in Common would severance the deeds of the property and split this 50% to each other (unless otherwise directed). This will be incorporated within your instructions of your Will.

At first death, the Will Trust of the Owner that has passed will transfer into a Family Trust, thereby protecting the 50% of the property, from dis-sideways inheritance and means testing. This and does not mean you are unable to move property and the survivor will have a right to live. There are many more benefits to a Will Trust and this will be explained by the Consultant. For further details of how this would benefit you and your family, please ring for a free of charge appointment.

Guardianship Trusts

If you fail to appoint Guardians in your Will and both parents die before the children reach 18, the courts will appoint Guardians instead, but they won’t necessarily appoint the people that you would have preferred to take care of your children.

Trust fund

Under English law, it is not possible for children to inherit assets until they reach the age of 18. You are able to determine what age you would like them to inherit 18, 21, 23, 25. The age of the child to when they inherit is up to you.

Therefore, even if your will attempts to leave assets outright to your children, there will be an automatic “trust” imposed, so that the executors or trustees of your will remain responsible for the assets until the children reach 18.

Where large sums are involved, ages of 21 or 25 are often chosen, on the basis that the children are more likely to display a greater degree of financial maturity the older they get.