Trusts
Trusts can allow you to pass on your property or other assets to your loved ones with clear terms and assurance that those you wish to benefit actually do so.
A trust exists when two or more people (Trustees) look after property or other assets for the benefit of one or more other people (Beneficiaries).
Trusts in wills are most commonly used to provide for children under the age of 18 years, to protect property or to take care of vulnerable loved ones. Trustees have a legal and binding obligation to act in the best interests of the beneficiaries at all times.
Trustees should be people you trust implicitly who are financially responsible with good administrative skills. They may be friends or family or you may choose to appoint a professional trustee to undertake this role.
Trusts are a very specialized area of law but are accessible to all and provide benefits such as:
• Children who inherit when under the age of 18 can have their financial interests managed by a nominated trustee who may also be their guardian or other individual
• You could avoid your children being accidentally disinherited in the event of your surviving partner remarrying by including a trust within your will
• Ensure that a beneficiary in receipt of disability benefits inherit via a trust so their benefits are not compromised
• Manage business assets in the event of your death to ensure business continuity
When we meet with you to assess your requirements, we will guide you through the trust options that you may wish to consider and will support you every step of the way.
Frequently Asked Questions
1. What is a Trust?
A trust is a legal arrangement for managing assets where property is held by one party (the Trustees) for the benefit of another party (the Beneficiaries). Once assets are placed in a trust they are owned by the trust and the trustees and this may happen after someone has passed away in the case of a Will Trust or during lifetime in what is known as a Lifetime Trust. The beneficiaries may receive gifts or income payments from the Trust but ordinarily, the capital amount is preserved within the terms of the trust.
2. I want my children to receive some of their inheritance when they reach the age of 18 years and the remainder when they reach 21 years, do I need a trust?
The simple answer is yes! Without a trust within your will your children will automatically inherit at the age of 18 years. Without a will, your children’s inheritance could be subject to a statutory guardianship order of the court who will manage your children’s finances. Creating a trust within your will ensures you appoint someone to manage your children’s financial interests until they reach the specified age of inheritance.
3. I’ve heard I can create a trust within my will which will ensure I won’t have to sell my home if I go into care?
It is illegal to deliberately deprive the state of assets i.e. to try to avoid paying care fees. However, you can make provision for your surviving spouse and children within your will by means of a trust that passes the first spouse to dies’ share into trust for the benefit of their children or other nominated beneficiaries. A Property Protective Trust ensure the surviving spouse can remain living in the family home but preserve the deceased’s share for their intended beneficiaries.
4. My child is in receipt of disability benefits, should I make a gift to them via a Trust?
A Disabled Discretionary Trust could be a good option in this circumstance. The trustees can support the beneficiary in managing their expenditure without compromising any means tested benefits they may be in receipt of.