Bluebond Estate Planning
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Will Trust

What is a Will trust?

A Will Trust is usually used as part of your estate planning to create a Lifetime Family Trust (or Discretionary Trust) on your death into which a Nil Rate Band (the value of your estate that is not subject to inheritance tax), can be passed.  Additional assets can be passed into the trust but the inheritance tax will be payable.

When writing a Will, clauses can be added to create both a Lifetime Family Trust on death, as well as the legal instruments to pass assets to it.  This means that no action apart from drafting a Will is taken prior to death.  The clauses are simply written into the Will.

It sounds simple.  Is right for me?

It is unlikely.  A Will trust may only be worthwhile if you think that your total assets will be under one nil rate band (currently £325,000 – 2010/2011) on the death of the second person if you are married or in a civil partnership.

If you are wealthy retired, a small business owner or part of the millionaire asset group with an asset base currently in excess of £1 million, we believe that you should seek professional independent financial advice before proceeding with this option to see if it’s really right for you.  A simple Will can be limiting, for both you, your surviving spouse and your children, and will not make use of some large potential tax savings.

I’ve already got a Will trust written, do I need to do anything?

Yes.  You probably need to relook at your Will as laws around Will trusts have altered.  If you made your Will prior to April 2007, then you definitely need to reassess it, ideally with the help of an experienced financial adviser.

Please also take a look at your expected assets for the future.  If you think that when you (or both of you if you are married) die that your assets will be valued in excess of the current nil rate band, or indeed, in excess of £1 million, then you really should consider alternative Lifetime Family Trusts.  Good financial advice, investment advice and tax advice as part of an overall financial plan are well worth looking into.  An experienced financial planner is essential for this.  Please call us on the number below.

Got more questions on Will trusts?

If you have any questions, please call us or Email us.

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