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A B C D E F G H I J K L M N O P R S T V W Y

Trust formation and administration

Trust formation and administration

A Trust is a holding device which involves a division of ownership between trustees and beneficiaries. The trustees hold the property for the beneficiaries on the terms imposed by the Trust Deed.

There are many reasons for creating a trust, the most common being asset protection and tax planning:

Wealth Protection

Protecting wealth for future generations is important for many clients. Beneficiaries of a well drafted trust cannot squander the trust property and it is not at risk from creditors in the event of future divorce or financial difficulties. The decision making process is taken away from the beneficiaries and left to people you can trust which is particularly reassuring if the beneficiaries are young or financially irresponsible.

Inheritance Tax Planning

You may want to take the value of the property and any future increase in value outside your estate to reduce your estate liability to Inheritance Tax. A trust can provide a flexible means of removing property from your estate while still retaining control of it, for example business owners may wish to benefit future generations while still retaining control of their company.

Pension Death Benefit Trusts are useful to receive the lump sum death benefit of a pension scheme member or proceeds of a life policy. A surviving spouse can have all the benefits of the trust without it forming part of his or her estate which has benefits for Inheritance Tax purposes.

We can also advise on the creation of charitable trusts which can be a tax efficient means of providing charitable gifts over a number of years.