Trusts

Trusts are essentially a means of gifting assets to individuals or a range of individuals in a tax-efficient way with the opportunity for the donor to retain a degree of control over the assets. They can be set up during an individual’s lifetime or under an individual’s Will.

There are two main kinds of trusts:
  1. The Interest in Possession Trust under which a specified beneficiary has a right to income but not to the underlying capital which can be set aside for the benefit of a further range of beneficiaries.
  2. The Discretionary Trust which allows a range of potential beneficiaries to be chosen and the Trustees to use their discretion to benefit certain beneficiaries from that range as circumstances vary over time.
There have been a number of varied and dramatic changes to the taxation of trusts in recent years, most particularly as a result of the Finance Act 2006. This means that now more than ever is the right time to take specialist advice on how to create new trusts or deal with existing trusts in a way which will be tax- efficient and which will avoid any risk that the Trustees may fall foul of the ever-changing tax regime.

We provide specialist and detailed advice on the tax and other advantages of creating trusts and are very happy to consider the appropriateness of offshore trusts as well.