Asset Protection Trust

A Trust established by a Settlor during their lifetime in which to shelter property and cash from the time of its assignment to the Trust subject to Inheritance Tax rules. It is appropriate for protecting the value of a home from other parties and ensuring it passes to nominated beneficiaries. Our Lifetime Trust documents are drafted for each client by a barrister owned company that has a wealth of experience in consumer related legal matters.

What is a TRUST?

A Trust is a way of managing assets and can be created during someone’s lifetime or on their death. There are three parties involved with the creation of a Trust, the Settlor, the Trustee and the Beneficiary. The Settlor (the original owner of the assets and the person setting up the Trust) will transfer their assets to the Trustee (the person or persons trusted to look after the asset) who will be instructed to hold and manage these assets on behalf of the Beneficiary (the person or persons the Settlor would like to benefit from the assets). This can be useful when the Settlor would prefer not to gift their assets outright to their Beneficiary. All the terms, conditions and details are outlined in a Trust Deed created by the Settlor.

What is a TRUSTEE?

The Trustee is the person or persons named in the Trust Deed to look after and manage the assets held in the Trust. The Trustees will have certain powers provided by law to allow them to manage the assets in the Trust effectively for the benefit of the Beneficiaries and the Settlor will also be able to provide power in the Trust Deed. Beneficiaries can be appointed as Trustees but this can often create a conflict of interest and it is usually advisable to appoint independent Trustees, who have no beneficial interest in the Trust. You will need to choose your Trustees wisely and be satisfied that they have the capacity to undertake this role and the responsibilities which accompany it.

What must the TRUSTEES DO?

Trustees must follow certain statutory rules and as well as any terms outlined in the Trust Deed. Most things which a person should or would want to do with their money or assets can be done by the Trustees.

For example, Trustees can open and operate a Trust bank account, invest money and buy and sell property. However, the Trustees should always seek appropriate advice before making any of these decisions.

The role of a Trustee should not be undertaken lightly. Trustees can be held personally liable for any mistakes they make and it is worth noting that a Trust will often continue for a number of years (to maximum of 125 years) which is known as the Perpetuity Period. For these reasons, Settlors will often choose to appoint professional Trustees.