Trusts

Make your wishes clear

When arranging protection policies such as Life Insurance it's important to consider the benefits of placing your policy into a Trust.

This may sound complicated and involve extra paperwork but it is relatively straightforward to do and we can guide you through the process. In fact, we can put policies in Trust for our clients at no additional cost.

When you place a protection policy in Trust, it basically means that you nominate one or more Trustees who will ensure any monies paid out on your death go to the people you wish it to go to. If you don’t place a policy in Trust, the money will go into your estate on your death and be paid out after the estate is settled.

Speed

If a policy is on a single life basis, the policy will not pay out until probate (or confirmation in Scotland) is granted on the estate. This can sometimes take months. If, however, the policy had been written in Trust, the funds do not go into your estate and the Trustee can make a claim for the proceeds to be paid immediately.

Inheritance Tax

When a policy has not been placed in to Trust, the proceeds as described above, go into your estate. This could increase the Inheritance Tax liability. If a policy is written in Trust, then the proceeds can be paid directly to the Trustee for the benefit of the beneficiaries - without going into your estate, thus avoiding a potentially increased tax liability.

Certainty

When a Trust is set up, you ensure that who you wish to receive the benefits of a policy (on your death) definitely does, because the proceeds don’t go into your estate, they are paid directly to the Beneficiaries via the Trustee. This can be extremely important in circumstances where someone may have been married before or have particular wishes for the policy proceeds should they die. You will either be asked to name the Beneficiaries in the Trust deed or give a “Letter of Wishes” to the Trustee so they know who you wish the proceeds to go to on your death.

In Summary

If we told you about a product that:

• Was free
• Could save your loved ones 40p in every £1
• Could save months of legal wrangling

Would you be interested??? If the answer is YES – then that product is a Trust. As placing your plans/policies in trust:

• Is free
• Avoids Inheritance Tax
• Avoids any probate delay

Trusts are an important area for you to consider and we would be happy to talk this through with you for new or any existing policies you may have.

Trusts are not regulated by the Financial Conduct Authority.