For some, thinking about a trust is like imagining it as a safety deposit box.
Sounds straightforward doesn’t it?
Setting up a trust isn’t always a straightforward process but it can be crucial depending on your family circumstances.
If you’re worried about what the future may hold after you die then you should consider a life interest trust. This should be drafted into your will. It’s also a way of eliminating inheritance tax should you meet the threshold and want your spouse to benefit in your will.
It’s especially useful if you have children from a previous relationship whom, along with your current partner, you want to provide for.
Maybe you are concerned about your home having to be sold for fees should your partner have to go into residential care – or worried that your estate may pass to the children of a new relationship should your partner remarry.
It’s not easy to think about these things when you are making a will, but experience shows, legal protection is needed.
That means you can keep your assets safe until a time you want them to be distributed.
What is a life interest trust?
A trust is set up to ensure a beneficiary has rights to receive the income.
Your beneficiary is referred to as a life tenant and this usually lasts all their life.
A life interest trust helps:
- Blended families – you can provide for your spouse and your children, rather than your assets passing to their new partner’s children
- Family businesses – hold shares in the trust to head off problems in the future
- Care home worries – protect your home from being sold off to pay for your spouse’s care
The trust can ensure your spouse can remain in your property for the remainder of their life, but the capital can ultimately go to your children once your surviving spouse dies.
Types of trustee
You can choose your loved-ones or independent trustees according to your own circumstances.
- If you would like to get the most up to the minute advice about what should be in your lifetime interest trust and an expert team to guide you through the process, we can help. Contact us for more details of our confidential service.
