Having a Discretionary Trust in your Will means assets can be directed into it on your death for the potential benefit of any number of beneficiaries you choose.
Here at TJP Wills, we specialise in will and estate planning, including the option to have a discretionary trust in your will. Based in Norfolk, we are able to work with clients all over the UK to deal with discretionary trusts.
A discretionary trust means that your assets can be directed into it on your death for the potential benefit multiple beneficiaries of your choosing. As with this option your estate can be paid in any amounts to any of the potential beneficiaries at the trustees’ discretion, it is not a case of any one individual having the total benefit from the trust.
Examples where a discretionary trust may be useful may be when a beneficiary has an impending divorce, as it could protect their inheritance so that it is not considered as part of a divorce settlement. Additionally, in the case of bankruptcy, it could help the beneficiary by giving access after the individual has been discharged. Furthermore, if the beneficiary is in receipt of means-tested benefits, it could protect them from the inheritance being considered as part of their assessment of benefit entitlement. It may also be relevant to consider a special disabled discretionary trust.
Another way to use a discretionary trust is also by allowing for various proportions of inheritance to be given to your children, for example, in your lifetime, so that in death, there is flexibility to make decisions of what proportions are to be given. Here, you could write a letter of wishes for the beneficiaries. Finally, if a couple are unmarried and do not have the same tax advantages as couples who are married or in civil partnerships, a discretionary trust could be useful in mitigating inheritance tax.
For more information about discretionary trusts, please get in touch today.