Trust Solicitors

There are many different types of trust that can be set up depending on how you want to control your assets.

Bare Trust

This is the simplest Trust and gives all assets to the beneficiary as long as they’re 18 years old or over (in England and Wales).

Assets in a Bare Trust are held in the name of a trustee. However, the beneficiary has the right to the contents of the Trust at any time if they’re 18 years old or over (in England and Wales). This means the assets set aside by the settlor will always go directly to the beneficiary.

Bare Trusts are often used to pass assets on to young people – the trustees look after them until the beneficiary is old enough.

Interest in Possession Trust

The beneficiary can get income from the Trust straight away but cannot control the assets that provide the income. The beneficiary has to pay income tax on the money they receive.

It’s common for a settlor to give their partner access to this kind of trust in their lifetime, with any assets passing to the settlor’s children after their partner dies.

Discretionary Trust

The trustees have complete control over the assets and the income they generate, deciding how and when to give them to the beneficiaries.`

People may set up this kind of Trust for their grandchildren, making the grandchildren’s parents trustees.

Mixed Trust

This combines elements from different Trusts. For example, it might give the beneficiary a right to the income (called an interest in possession) of half of a Trust Fund.

Trust for a vulnerable person

If the only beneficiary is vulnerable, for example someone who is disabled or an orphan, they will pay less tax on the income from the Trust.

The legal wording of a trust needs to be precise and there are different type of Trusts which can be set up in life or in your Will for after you die.

Always get specialised legal advice as there can be tax and legal ramifications of setting up a Trust.

We can set up and advise about:-

• Lifetime Trusts to place assets in now and or to receive assets in the future
• Wills Trusts to be set up following your death and which leave assets to Trusts that you or another person have already set up
• Ongoing advice to trustees regarding their role as trustees and their options
• Changing trustees, adding new beneficiaries where the Trust permits and updating letters of wishes.

We do not advise about Trusts where the person setting them up lives abroad and/ or where the assets to be held in Trust are abroad.

We do not advise about Charitable Trusts.  We can advise about non-charitable, Trusts which include charities or charitable organisations as potential beneficiaries.

Trusts are set up for a number of reasons, including:

• To control and protect family assets
• When someone’s too young to handle their affairs
• When someone cannot handle their affairs because they’re incapacitated
• To pass on assets while you’re still alive
• To pass on assets when you die (a ‘Will Trust’)
• Under the rules of inheritance if someone dies without a Will (in England and Wales)

Different kinds of assets can be put in Trust, including:

•  Cash
•  Property
•  Shares
•  Land

A Trust is a legal relationship created (in lifetime, or on death) by a settlor (the person who sets up the Trust) when assets are placed under the control of a trustee (the person who manages the Trust) for the benefit of a beneficiary (the person who benefits from the Trust), or for a specified purpose.

A Trust has the following characteristics:

• The Trust assets constitute a separate fund and are not a part of the trustee’s own estate
• Legal title to the Trust assets stands in the name of the trustee, or in the name of another person on behalf of the trustee
• The trustee has the power and the duty, in respect of which he is accountable, to manage, employ or dispose of the assets in accordance with the terms of the Trust and the special duties imposed on him by law
• The reservation by the settlor of certain rights and powers, and the fact that the trustee may himself be a beneficiary, are not necessarily inconsistent with the existence of a Trust.