A Guide to Setting up a Trust
Trusts are becoming increasingly popular in the UK as an efficient way to pass on assets to the people they’re intended for. Similar to Wills, but with some key differences, a trust can minimise the tax liability of your estate and ensure that as much of your assets as possible go to those you wish them to.
Setting up a trust isn’t difficult but will require specialist input, meaning that you’re rarely able to DIY the process as some people might with a Will. To assist you in the formation of your trust, we are able to act on your behalf to ensure that your trust is as accurate as it needs to be to achieve your aims.
What is a Trust?
There are several different types of trust that you could make use of depending on your aims, but simply put, they are a mechanism for the safe protection of assets until the time comes that they can be inherited by their intended beneficiaries.
It is this element of protection, preventing them from being included as part of your estate and passing through probate which is so desirable.
A trust could be used to;
- Provide for your children or grandchildren if they are still very young and aren’t capable of managing money.
- Provide for an adult who is unable to manage their money for a variety of reasons.
- To ensure that you are taken care of when you’re older and receive the care that you need, with or without appointing Powers of Attorney.
It is even possible to form a trust with the sole intention of providing financial support for a child or grandchild’s education, with the assets in the trust only able to be used for this purpose.
In the process of forming a trust, you will be required to nominate what are known as trustees. It is these trustees who will be responsible for administering the trust and to disseminate assets and funds as required.
You should always make sure that the people you nominate are aware of their responsibility and what the position entails.
The Cost of Forming a Trust
The cost will depend on the scope of the trust and how involved the formation procedure is. The most important factor to focus on is ensuring that the details of the trust are as accurate as possible to avoid legal issues down the line due to ambiguous wording or unclear detail.
Absolute Entitlement and Discretionary Trusts
Both the wording and the type of trust you form will determine just how both the capital as well as any income derived from the trust are treated for the purposes of assessing your suitability for assistance from the State.
If a discretionary trust, only the actual income received would be considered to assess entitlement for provisions such as elderly care.
Heritage Wills: Providing Expertise in the Formation of Trusts
Heritage Wills possess a vast amount of experience in the formation of trusts and can work with you to ensure that the trust you form is suitable for the aims you are trying to achieve.
For more information on the services we provide, speak to a member of our team by calling us on 01603 894500 where we’ll discuss your requirements in detail.