Solicitor Emily Davidson Offers Guidance on the Issues with Family Protection Trusts and Potential Pitfalls: Key Essentials to Know
“Sold the Dream of a Trust”[1]
For any individual considering who they would wish to benefit from their Estate when they pass, protecting their assets as far as possible is often their main concern.
Trusts can be formed within Wills (“a Will Trust”) or during lifetime (“a Lifetime Trust”) and can offer a range of safeguarding benefits for many individuals. However, depending on the intentions behind the creation of the Trust, certain options may be more suitable for individuals depending on their specific circumstances.
Once they have been created, Trusts are a separate legal entity and are subject to a specific tax regime. Consideration therefore must be given to the implications of potential Inheritance Tax, Capital Gains Tax and Income Tax. There is also ongoing Trust administration responsibilities that must be adhered to.
Unfortunately, due to not having received the essential advice tailored particularly to their circumstances thousands of people have been affected by the creation of the “Family Protection Trusts’[2 Will Writers and Estate Planners offer the creation of Trusts to individuals looking to safeguard their Estate, but often it is the case that those individuals are not advised on the best options for their circumstances or not informed of their ongoing liabilities.
Emily Davidson, Solicitor at Enoch Evans Solicitors shares ‘That whilst Trusts are a useful tool to protect the assets within your Estate, they are unfortunately not a one size fits all and individual circumstances should always be considered and professionally advised on before the creation of any Trust’.
If you are an individual who has been implicated by the creation of a Trust, without having received the requisite legal advice or you are considering creating a Trust to safeguard your Estate, please contact a member of the Wills Tax and Probate Team at Enoch Evans on 01922 687730.