A Discretionary Trust provides protection for your assets and property after your death should you have concerns about one or more of your beneficiaries.
The reason you may choose to incorporate a Discretionary Trust into your will is if any of your intended beneficiaries fall into any of the following categories.
- They feel uncomfortable handling money or they are not able to because of their current financial circumstances, for example if they are likely to become bankrupt.
- There are relationship issues, for example they are currently going through a divorce or may become divorced.
- They are reliant on means-tested state benefits which would stop should they receive a legacy.
- They do not have the mental capacity to handle money.
- They have issues with recklessness or are irresponsible.
- They have issues with drug or alcohol addiction.
- They are unduly influenced by another person.
When we work with you to create your Discretionary Trust will you will be asked to name up to four Trustees.
The role of these trustees will be to manage the trust’s assets after your death. They will also be responsible for making decisions about when your chosen beneficiaries will receive any benefit. Part of our role is to help you choose Trustees who will be able to carry out these duties responsibly. Further, we will create guidance for the Trustees in line with your wishes on how your estate should be managed after your death.
It is important to note that this is an overview, not a full explanation of a Discretionary Trust Will and should the value of assets being placed into a Discretionary Trust exceeds £325,000 you will also need specific Inheritance Tax advice regarding the tax charges during the lifetime of the trust.
For general informational purposes only, not intended or to be taken as legal advice. To make sure this is appropriate for you please seek advice and contact us.
