Trusts

Flexible Life Interest Trust (FLIT)

This Trust is incorporated as part of a Will and is usually created on the death of the first spouse, this will be advantageous to couples who own their own property and have additional savings or shares that they wish to incorporate.

The trust has a number of benefits:

  • This Trust may affect what part of the home is assessed should the owner require care.
  • The Trust preserves assets for the nominated beneficiaries.
  • The Trust protects against beneficiaries being declared bankrupt.
  • The Trust can guarantee an appropriate distribution of assets where couples each have children from other relationships.
  • The Trust cannot be contested or challenged by potential relatives, unlike a Will.The Trust is flexible and can be changed to another type of trust should personal circumstances or changes in legislation dictate.
For more information about Flexible Life Interest Trusts


 Protective Property Trusts

A Protective Property Trust is a process which enables you to safeguard your property for future beneficiaries, normally the children. The Trust is Inheritance Tax neutral; it is activated on first death and has the following benefits:

  • This Trust may affect what part of the home is assessed should the owner require care.
  • The Trust gives the surviving spouse control and security of tenure in the property for their lifetime.
  • The Trust protects against any potential beneficiary being declared bankrupt.
  • The Trust can guarantee an appropriate distribution of assets where couples each have children from other relationships.
  • The Trust cannot be contested or challenged by potential relatives, unlike a will.
For more information about Protective Property Trusts


Lifetime (Family Protection) Trust:

These are  set up during the lifetime of the owner. With the Trust having several unique advantages:

  • This Trust protects the WHOLE of the property
  • The Trust provides additional protection and allows control and rights over the property compared to giving the property away whilst still alive.
  • Property placed in Lifetime Trust is not formally part of the estate on death and is therefore not subject to the probate process saving time, money and reducing administration at a difficult time.
  • The Trust is Suitable for a single owner.
  • This Trust may affect whether a home is assessed should the owner require care.
  • The Trust preserves assets for the nominated beneficiaries.
  • The Trust cannot be contested or challenged.
  • If a beneficiary is deemed unreliable, the trust  has the flexibility to allow access to funds at an age where the beneficiary is viewed as reliable.
  • Additional Trusts can be added to a Lifetime Trust to help mitigate Inheritance Tax.
For more information about Lifetime Trusts

 

Discretionary Trusts

Discretionary Trusts are a particularly useful tool when considering Inheritance Tax (IHT). This is particularly beneficial to unmarried couples.

  • The assets that would otherwise have been passed on to the surviving partner or spouse are instead placed in trust. The surviving partner can be made a beneficiary. Trustees must be appointed.
  •  Under the terms of the Trust, the beneficiary does not have absolute entitlement to the assets and therefore cannot demand income or capital as they please.
  • As a result, the assets placed in trust are not treated as part of that individual’s estate for tax purposes.
  • A Letter of Wishes is provided alongside the Will. The letter states the express wishes of the deceased and also ensures that adequate provision is made for the surviving partner.

Disabled Discretionary Trust

These Trusts are set up by parents or other relatives as a way of safeguarding the inheritance of a disabled child or relative. This ensures that the monies left to disabled beneficiaries by their parents are not eroded or set against any assessment or entitlement to state benefits.

It is usual for other siblings to be the alternative beneficiaries to these Trusts.

Findon Legal Consultants can be contacted for more information on these or any other trusts.