Trusts & Protection
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The reasons for setting up a Trust fund vary widely. Although the majority of Trusts are created for reasons that closely relate to those shown below, the list is not exhaustive.
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To protect and control family assets
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For astute inheritance planning and transfer of assets to heirs. Placing assets in a Trust might minimise estate and Inheritance Tax (IHT) liabilities. It might also be a means by which someone can provide for a spouse while ensuring that assets are ultimately passed to children, or by which to enable a conditional transfer of assets.
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For proper management of assets on behalf of a minor (child under the age of 18) or someone who is incapacitated.
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To protect against excessive, detrimental, discretionary spending. Creating a Trust is an ideal way of controlling assets for spendthrifts who have a hard time curtailing their compulsive spending habits.
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To serve as a contingency fund to take care of the settlor and to maintain control of the assets should he or she become incapacitated (unable to take care of himself or herself or manage assets due to decline in mental or health fitness).
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Trusts had their origin around 800AD in classical Roman law. English Trust law originated around the 11th and 12th centuries when knights going off to the Crusades transferred their land to a trusted third party.
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Much of the English Trust laws we have today were largely written in the Trustee Acts of 1925 and 2000, with related legislation found in several other Acts.
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There are different types of Trust designed to meet different kinds of needs. The type of Trust you might use will depend on what the intended purpose is, who the beneficiaries are, what the assets are, and how and when you want the assets to be distributed.
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Trusts can be included in Wills and also be stand-alone, depending on the type of Trust.
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We and our partners have extensive knowledge and expertise in advising on and preparing Trusts.
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Trusts are not necessarily suitable for everyone and every situation and it's important to ask us for advice.