Trusts & Estate Planning (UK)
Clear guidance on Property Protection Trusts,
Business Trusts and other trust arrangements
for individuals, families and business owners
in England & Wales.
What is a trust?
A trust is a legal arrangement in which
trustees hold and manage assets for the
benefit of one or more beneficiaries
according to the terms of the trust.
In simple terms, a trust allows you to
separate legal control of an asset from
the person or people who are intended to
benefit from it.
A trust can be created to hold assets such
as property, money, investments or business
interests.
The person creating the trust is commonly
known as the settlor.
The people responsible for managing the
trust are the trustees,
and the people who benefit are the
beneficiaries.
The three main parties to a trust
| Person | Role |
|---|
|
Settlor |
Creates the trust and transfers assets
into it. |
|
Trustees |
Legally manage the trust assets in
accordance with the trust terms. |
|
Beneficiaries |
The individuals or organisations who
may benefit from the trust. |
Do I need a trust?
Not everyone needs a trust.
A straightforward Will may be sufficient
for many people, but a trust may be worth
considering when you want greater control
over how property, business interests or
inheritance are managed and passed on.
Whether a trust is appropriate depends on
your assets, family circumstances and what
you want your estate plan to achieve.
You own a property
You may want to provide for a surviving
partner while preserving part of the
property for other beneficiaries.
You own a business
Your estate plan may need to address
what happens to shares or business
interests after your death.
You have a blended family
Trust planning can help balance the
needs of a current partner with children
or beneficiaries from an earlier
relationship.
You want to protect an inheritance
A trust can allow assets to be managed
rather than passing everything outright
to a beneficiary immediately.
A beneficiary is vulnerable
Some beneficiaries may benefit from
additional protection or flexibility
rather than receiving assets outright.
Your estate is more complex
Trusts can form part of wider planning
involving different assets, beneficiaries
or succession objectives.
What types of trust are available?
Different trusts are designed for different
purposes. The appropriate trust depends on
the asset being protected, who should benefit
and how much flexibility you want the trustees
to have.
What is the difference between a Will and a trust?
A Will records what should happen to your
estate after death. A trust is a legal
arrangement under which trustees hold and
manage assets for beneficiaries according
to specific terms.
| Feature | Will | Trust |
|---|
|
Main purpose |
States how your estate should be
distributed. |
Controls how particular assets are
held or managed. |
|
Who manages it? |
Executors. |
Trustees. |
|
Who benefits? |
Beneficiaries named in the Will. |
Beneficiaries defined by the
trust terms. |
|
Flexibility |
Usually distributes assets according
to specified instructions. |
Can provide ongoing control or
trustee discretion depending on
the trust. |
How does a trust work?
A trust works by transferring legal
responsibility for specified assets to
trustees, who must manage those assets
according to the terms of the trust for
the benefit of the beneficiaries.
The exact process depends on the type of
trust being created.
Some trusts are created during a person's
lifetime, while others are created through
the terms of a Will and only take effect
after death.
The trust document normally sets out the
trustees' powers, the beneficiaries,
how assets may be used and when capital
or income may be distributed.
How much does a trust cost?
Trust costs depend on the type of trust,
the assets involved and the complexity of
the planning required. Xwills offers
fixed-fee Property Protection Trust Will
options from £445.
More complex trust arrangements may require
additional drafting, tax advice or specialist
professional input.
We recommend establishing what you are
trying to achieve before deciding which
trust structure, if any, is appropriate.
Key Takeaways: Trusts
-
● A trust separates legal management of
assets from the people intended to benefit.
-
● Not everyone needs a trust; a standard
Will may be sufficient for many estates.
-
● Trusts can be used in planning involving
property, business interests and family
inheritance.
-
● Trustees have legal responsibilities and
must follow the terms of the trust.
-
● The appropriate trust depends on your
assets, beneficiaries and objectives.
Frequently Asked Questions About Trusts
Do I need a trust if I already have a Will?
Not necessarily. A Will may be sufficient
for many people. A trust may be useful where
you want additional control over how specific
assets are held or distributed.
Can I put my house into a trust?
Certain trust arrangements can be used in
estate planning involving property.
The appropriate structure depends on how
the property is owned, who should benefit
and your wider circumstances.
Can a business be placed into a trust?
Trusts can form part of succession and
estate planning for some business owners.
Business structure, ownership, tax treatment
and beneficiary arrangements should all be
considered.
Who should I appoint as trustee?
Trustees should be people or professionals
you trust to manage assets responsibly and
follow the terms of the trust. The right
choice depends on the complexity and duration
of the arrangement.
Can a trust be changed later?
Whether a trust can be changed depends on
the type of trust and its terms. Some
arrangements provide flexibility while
others may be difficult or impossible to
amend once created.
Not sure if you need a trust?
Speak with Andrew Walters MSWW for a
no-obligation discussion about your
circumstances and the options available.
Book Your Free Trust Review
