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What is a Trust?
There are 2 main types of Trust. A Trust can either be created during your lifetime or upon your death.
Examples of when a LIFETIME TRUST would be appropriate:
- You wish to remove asset value from your estate to avoid Inheritance Tax (IHT); and/or
- You would like to make a gift to someone and ensure that such gift cannot be considered in any future divorce settlement of the recipient; and/or
- You are concerned that your assets may be diminished if used to pay for your care in the future; and/or
- You wish to minimize the possibility of someone contesting your Will because you do not wish to provide for that person or those people.
Examples of when a TRUST UPON DEATH would be appropriate:
- You wish to ensure that your surviving spouse cannot accidentally or intentionally disinherit your children after your death; and/or
- You are concerned that your assets may be used to fund your surviving spouse’s care needs after your death and, as a result your children may not benefit from your estate (The quality of your surviving spouse’s care will not suffer because you protect your share of the joint estate from being assessed for their care fees); and/or
- A beneficiary of your Will is vulnerable (e.g. illness, addiction, learning difficulties, etc.) and you wish for their inheritance to be permanently administered by an appropriate person or people of your choosing; and/or
- You are worried that a beneficiary of your Will could be subject to unwarranted third-party pressure after they inherit, and you wish to prevent this.
Please note that some of the above examples are interchangeable between Lifetime Trusts and Trusts upon Death.
As there are various types of Lifetime Trusts and Trusts upon Death and creating most of them must be undertaken by a suitably qualified solicitor, the costs can vary. However, TRF uses a firm whereby the overall cost to create a Trust would rarely be more than £1,000 (inclusive of VAT).
These costs do not apply when creating your Will and are only relevant if you arrange a Trust during your lifetime or if one is created as a result of your death.