Our specialist estate planning and trust lawyers are increasingly asked this question by individuals, anxious to provide for dependents after their deaths.
The ‘baby boomer’ generation in 2016 is asset rich, as a result of having lived in an era of affordable property ownership. However, as a generation, it is also dealing with ‘blended families’ as a result of increased divorce levels, the probability of having to find money to provide for the care of vulnerable/ageing relatives (1 in 4 will need the services of a care home), concerns that their children cannot afford housing, or to educate grandchildren. There are others concerned that their children may not be able to manage large amounts of money.
The answer is to consider the option of setting up a trust, which is the formal transfer of assets (e.g. property, cash, shares) to identifiable individuals, or perhaps a trust company to hold the assets for the benefit of those individuals.
You must take suitably experienced legal and tax advice from the very beginning of the process, because the consequences of a badly drafted trust deed or will trust can be horrendous, and the only possible beneficiaries in that situation would be litigation lawyers, accountants, and HMRC!
You must choose trustees, understand what the duties and discretionary powers of those trustees are to be, ensure that legal and beneficial ownership is separated, and that your wishes or any conditions that you want to have attached to the trust fund are clearly stated.
You must decide what type of trust that you wish to set up, because there are different types of trusts, for example discretionary trusts, and fixed interest or life interest trusts.
There may be property in another jurisdiction, perhaps where the legal doctrine of ‘forced heirship’ governs the division of assets upon death, a doctrine which does not prevail in England and Wales.
Contact Lewis Nedas Law Expert Estate Planning and Trust Lawyers
If you would like to speak to our specialist team headed by Myles Reback about this issue, please contact us on 020 7387 2032 complete our online enquiry form here.
