Trusts come in all shapes and sizes; some can be flexible and can be tailored to your and your family’s needs and some Trusts are deliberately restrictive.
Some Trusts have their own tax regime and some are taxed at the beneficiary’s own marginal rates.
All trusts are taxed in one way or another and sometimes the tax consequences help you decide which trust is best for you.
Trusts are used for all sorts of reasons. These reasons include:
Trusts can be created in your Will and only come into effect when you die. They can also be created now, to be used during your lifetime.
Although lots of different names are used, most are a variation of the following three types:
Trusts are used to benefit Vulnerable or Learning Disabled beneficiaries for a number of different reasons.
There are only two types of Trust that work in these circumstances, a fully flexible Discretionary Trust and a Disabled / Vulnerable Person’s Trust.
Using the right Trust permits the money or assets in that Trust to be disregarded for the purpose of means testing for benefits or care and support packages. The money can be used for the long term benefit of your loved one, for example, paying for services that the State won’t fund or for luxuries like holidays etc. and their various benefits or services remain secure.
The choice between Discretionary or Disabled Persons Trusts – which is right for you?
If you have a Disabled or Vulnerable beneficiary, you might assume that a Disabled Persons Trust will be what you need. But I’m afraid it is not as simple as that.
People often say that getting started is the hardest part of all. Because you are reading this, you should feel encouraged that you have already begun the process, and my job is to help you from here. Simply pick up the phone and call me or drop me a short email.