A trust is a legal document in which trustees appointed by you hold assets for the benefit of “beneficiaries”, commonly one or more named individuals. It can hold most types of assets, such as property, money or investments.

The most common reasons to consider a trust are:-

You may wish to make monies available for children and grandchildren, but you don’t want them to have direct access to this. By setting up a trust, you can place monies into it and have discretion to decide when and who receives the monies, giving you flexibility and also protecting your families’ interests;

If you have a vulnerable or disabled beneficiary that may not be able to manage the assets themselves. Placing assets into a trust will protect the monies for that beneficiary, preventing the need for an attorney or Court appointed Deputy to manage it;

If you leave monies outright to someone, it is theirs immediately and is taken into account for means tested benefits, care fees and divorce. By placing assets into a trust this can protect them from this.

When you place assets into a trust, you are no longer their owner, as the trust will own them. The assets are therefore assets of the trust and after 7 years the value will drop out of your estate when considering inheritance tax.

You can set up a trust at any time, or write one into your will. However the laws surrounding trusts are complex, and you should discuss these with a solicitor and financial advisor before putting one in place.