Trusts
Trusts aren’t just for the very wealthy
Often misunderstood as only benefitting the very wealthy, trusts can provide an efficient wealth protection strategy for anyone and, in some cases, they can even help to reduce your capital gains tax and inheritance tax.
When you might use a trust
A trust is a legal arrangement where you give cash, property or investments to someone else (the trustee) so they can look after them for the benefit of a third person (the beneficiary). By setting up a trust, you can ensure that your money will be used according to rules that you set out.
Trusts are often used to help friends or family members after your death, or to pay for your care in later life.
Trusts are commonly used to;
1) support someone who can’t manage their own money. For example, if you have a vulnerable child, you may set up a trust to help them financially should anything happen to you.
2) ensure that your money is used to look after you if you could no longer care for yourself.
Trusts can also be of benefit when considering the handing down of shares in family companies.
Using a trust to reduce inheritance tax
A trust can be a good way to reduce your inheritance tax.
When you place your assets into a trust (provided certain conditions are met), they no longer belong to you, they are owned by the trust. This means that when you die, their value won’t be subject to inheritance tax.
Trusts for wealth planning
Trusts are also used to preserve the existing wealth within a family. With a trust structure, you can unsure that only those whom you wish to benefit from your estate do and you can maintain control of when and how assets are paid.
We can help with your trust
The administration of trusts and estates can be complex and you will need professional advice to get it right.
At PW John and Co accountants in Weston-super-Mare our expert tax team possess a wealth of knowledge relating to trusts and estates. We can help with all compliance matters, such as filing your trust tax returns.
You can call our team on 01934 412097, email or complete the form on our contact page and we’ll be in touch shortly.
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