The Estate Planning Team at Wilford Smith provides highly personalised legal advice that reflects our clients’ circumstances. Depending on the nature of your estate, it may be in your interest to pursue legal arrangements that will reduce your liability for inheritance tax, or to protect your home from being sold in order to cover your care costs in later life.
You may have young children or grandchildren to whom you intend to leave assets, but not until they have reached a certain age, or you may have vulnerable family members who would struggle to manage a large sum of money if they were to inherit a large portion of your estate. In circumstances such as these, it may be advisable to set up a trust in order to best manage and protect your assets. With many years of experience in advising on estate planning, our team of solicitors know how important it is for our clients that their legacy is protected in a way that suits their individual circumstances and offers the greatest benefit to their family.
What is a trust?
A trust is a legal arrangement whereby a person, a group of people or a company take control of money or assets and use it for the benefit of another person or group of people. The people who are given control of the money or assets when the trust is set up are called trustees and the people who receive money or assets from the trust are called beneficiaries. You can set up a trust independently during your lifetime or incorporate one as part of your Will, meaning that one will be created when you die.
The terms of the trust will generally be written down, providing rules on how the trust will operate, who will act as a trustee and who the beneficiaries will be. Once the trust deed has been drafted, trustees must use the trust funds in the way you have instructed in the terms of the trust deed. You can put money, property, investments or any other assets you own into a trust in order that this can be passed to the intended beneficiaries at a later time. While it is possible to set up a trust as a simple agreement between two or more people, you should create a legal document, known as a trust deed, so that your intentions regarding the use of the trust are made absolutely clear.
Why should I set up a trust?
People choose to set up trusts for a great number of reasons, but the most common are for the benefits of tax and family planning. By setting up a trust, an individual can move assets from their possession into the trust, and as such reduce their liabilities for inheritance tax on these assets when they die. In relation to family planning, transferring money, property or investments into a trust means you can decide when members of your family, such as children or grandchildren, will inherit these. This also means that these assets will not be lost in the event of a divorce or litigation.
You may also wish to set up a trust in order to put in place financial arrangements if you become ill later in life, allowing you to decide who will look after your property and money if you are not able to do so yourself. You might want to leave money to someone for a particular purpose, for example to cover the costs of university education, and this purpose may be set out in the trust deeds. If you have a life insurance policy, you may wish to set up a trust in order that any proceeds will remain separate from your estate for tax purposes.
Why should I instruct a solicitor in relation to a trust?
Solicitors are able to give valuable assistance to people looking to set up a trust, providing guidance on the most appropriate type of trust for your needs. In order that your intentions are carried out in the way you wish, it is important that the wording of the trust deed is accurate. A solicitor is best placed to prepare this paperwork on your behalf, as well as to keep you informed on any tax implications that may arise in the setting up of a trust. You may also wish to take legal advice before appointing trustees to ensure that your intentions are carried out in the way you wish.
If you have been appointed as a trustee, a solicitor can give guidance in relation to your responsibilities and duties. They will also be able to advise on investment and management of trust funds, accounts and taxation, and when to pass on assets to beneficiaries.
Solicitors can also act as a trustee of your trust, carrying out roles such as trust management, distributing trust assets and corresponding with trustees.
Contact our Trusts Lawyers Sheffield
Wilford Smith’s Estate Planning Team offers a comprehensive service in all areas of estate planning. We provide expert legal advice on the setting up of a trust, guidance for those appointed as trustees, as well as the administration of trust matters on your behalf. As a full-service firm, our Estate Planning Team is able to work with legal experts in other areas, such as our Property and Tax Solicitors, to guarantee that your assets are protected. With a wide-ranging client base we are experienced in managing estates of all sizes, including large estates and those that are international in scope. Whether you are looking to make arrangements in regards to savings, property or a business, our Estate Planning Solicitors will provide you with a high-level professional service tailored to your needs.
Get in touch with our specialist Estate Planning Team today on 01709 828 044 for assistance.