Asset Protection in Harrow
covering Wembley,Ruislip,Pinner,Northwood,Brent,Edgware,Stanmore,Hillingdon and parts of South Hertfordshire
Setting up Trusts in your Will
Establishing a Trust in your Will can be extremely valuable in Estate Planning terms for a number of different reasons. When it comes to protecting assets and controlling the distribution of your Estate, Trusts are essential and we provide a variety of different solutions depending upon your objectives. Despite changes in Taxation policy in October 2007 there are still very valuable reasons for establishing Trusts in your Will and there are still Inheritance Tax benefits. Furthermore having certain assets ring fenced in a Trust environment can ensure that your children are not disinherited through remarriage after your death, and ensure that they are protected from subsequent divorce settlements too. Should a surviving partner become infirm and need to go into long term care funds in Trust would not feature in terms of Local Authority means testing.
In terms of saving Inheritance Tax,
by putting funds into a Trust on your death you can ensure that your children benefit without running the risk of the fund creating an additional Inheritance Tax burden in the future. Often the solution to many a complex situation can be with the use of a Trust, which can be created as a stand alone document that is set up whilst still alive and comes into force immediately, or if written into your Will, is effected upon your death. A Trust can be a simple clause in a Will that protects the money for a minor child until they reach a specified age, or you might want to protect a beneficiary’s inheritance for a short period until a bankruptcy has been discharged. A more complex Trust would be required if you wished to make provision in your Will for a disabled child who is unlikely to be able to manage their own financial affairs.
Popular Trusts Some of the more common Trusts utilised in modern Wills are used for protecting your property after your death. You may wish to leave your property to your children but by using a Trust this will allow you to provide for your spouse or partner for the rest of their life. Avoiding inheritance taxes legally can be a minefield but the one guaranteed route, wholly endorsed by the Inland Revenue, is by way of a Discretionary Trust either set up in your lifetime or within your Will to be effected on the first death of a couple.
How They Work The Settler leaves specific assets ‘Trust Property’ to the Trustees on Trust to hold the assets on the terms of the Trust Deed. The money or property is left so that beneficiaries can have the use of the property or the income from the money, either for the rest of their life or a specified number of years. You can determine specified payments to be made to the beneficiary or allow the Trustees to determine how much and when.
• The Settler = the person who establishes the Trust.
• The Trust Deed = the written document, which sets out the terms of the Trust, set up by the Settler.
• The Trustees = the person or persons charged with holding the trust property on behalf of the beneficiaries.
Trusts for Disabled If there is someone in your family with a learning disability, you may be concerned about how they will cope in the future when you’re no longer there to care for them. But how do you provide financially for someone who may find it difficult to manage his or her own affairs? And how do you leave money to secure the future of a loved one without reducing their entitlement to DSS benefits or local authority funding of residential care? If you leave them your estate the money could go to the social services to pay for their long-term care without any improvement to their lifestyle. If you don’t leave them your estate their appointed legal representatives could make a claim under the “Provision for Family and Dependants Act 1975” and your estate could end up with the social services anyway. We have experience in writing Wills for people in this situation.
Setting up a Protective Property Will allows clients to protect their property from the Community Care Act of 1990. Last year, 70,000 homes (200 every day) were taken by Councils throughout the UK to recover Long Term Care costs. A protective Property Will could have prevented this action. Should a person having total assets in excess of around £23,2500 (For the financial year 2013/14, the upper capital limit for the means test in England) go into care, without a Protective Property Will, that person is liable for their care costs. Having exhausted any money available, the Council would then look to recover its costs by selling the home. There are things you can do to ensure their benefits are not reduced or your estate is not taken to pay for long-term care costs. However, all circumstances are unique and each case should be considered carefully before making a decision.