Trusts
A trust is a legal obligation that binds one or more individuals (trustees) to manage assets for the benefit of one or more individuals (beneficiaries). The trustees act on behalf of the person who set up the trust (the settlor) and whose assets are placed in it. The settlor's wishes and intentions are set out in the trust deed.
Placing one's capital assets within a trust can be a highly effective tax planning strategy, particularly in relation to passing wealth to future generations; however, this is not their only use. Reasons for utilising a trust other than estate planning include the beneficiary being a minor or incapacitated.
The types of capital assets that can be placed within a trust are wide ranging and can include property, shares, personal possessions and pension funds.
There is a broad selection of trusts available. Great care must be taken in selecting the correct trust, as the wrong decision could result in restricted access to capital and taxation implications.
This area is incredibly useful and efficient for many people, but is one that certainly requires professional guidance.
The Financial Services Authority does not regulate trust advice.
