Not just the preserve of the very wealthy, used appropriately trusts are an extremely useful tool for protecting your assets and passing them on to beneficiaries. Importantly, one of the main benefits of a trust is to ensure that your estate is passed on in line with your wishes.
A trust is an effective way of managing assets (money, investments, land or buildings). They involve three parties – the settlor who puts assets into the trust, the trustees who manage the trust and the beneficiaries who benefit from the trust.
Assets put into a trust may not count towards inheritance tax (IHT). But there are a number of types of trust and some do have to pay IHT in their own right while others have to pay income tax or capital gains tax – choosing the type of trust that’s right for you takes care and skill.
When you put assets into a trust, the trust may be subject to its own taxation rules, so, it is crucially important that the right one is chosen.
Other reasons why a trust might be the best solution for you include:
Passing on assets in line with your wishes
You may want to ensure your partner can live in a property but that when they die any property in the trust will pass to your children.