Trusts and tax planning
Trusts, although a medieval invention, are widely used in the modern world. For example, pension funds are trusts. They are also often used for tax and estate planning, as the following examples indicate:
- Grandparents wishing to skip a generation for IHT purposes and provide for their grandchildren's maintenance or education will often use a trust
- Parents wishing to pass assets to a son or daughter prior to marriage, in a way that protects the capital in the event of divorce, will use a trust
- Families with landed estates will often use a trust to pass it down the generations
- Someone wishing to set up a charity will often use a trust
- Many IHT saving schemes use trusts.
Trust law is complex and careful planning is essential if the desired object is to be achieved. If you are interested in pursuing trusts as a means of protecting your income, please outline your situation using our Enquiry Form
LMG has produced a guide to personal taxation. To receive your own free copy, please click here.