help please with Universal Wealth preservation Trust

edited 30 November -1 at 1:00AM in Savings & Investments
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happyherohappyhero Forumite
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edited 30 November -1 at 1:00AM in Savings & Investments
Hi my mother is fretting over a scheme she has just paid for, one of those things where they tell you to take out a trust to protect yourself from inheritance tax so that that you can pass on more to your family rather than the tax man. She thought it was great at first but is now having doubts as to whether it is worth the money and does she really need it etc. I went to the first seminar with her and was with her for when they came round to arrange the trust she needed. She picked stage 2 and it came to £4000.

Has anybody got any experience of these people or similar schemes?

Once in the trust your property and savings/investments are protected from tax and any other attack basically.

Both the seminar talker and the guy who came round have a bunch of qualifications in finance/investment and legal stuff, the seminar talker was a non practicing solicitor, i.e he used to be a solicitor before he did this.

I like to think I am not easily swayed or taken in and both guys seemed nice genuine people plus I felt what they said made sense. I understood it all but my mother was worried that she did not. She feels all control will be taken away as they put the house and everything in trust whereas the way they do it is protect it in the trust and my mother becomes the boss for want of a better word and makes the decisions as to what will happen with everything, i..e who inherits what etc. Plus this way the property cannot be taken for things like care fees.

I thought it was a good thing but my mother is now thinking of backing out and I must admit if she keeps being against it it does start to make me have doubts even though I was sure about it up till now.

Can anybody tell me what they think or what would be brilliant if somebody has had this for a while and what their experience and thoughts of it are?
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  • jimjamesjimjames Forumite
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    If it was done for the specific reason of avoiding care fees then it could well be invalid.

    I'd also ask why she wants to avoid being able to choose the right care home if she should need it. I'd much rather have a choice that costs me than be forced to use one that I hate as it was chosen by the council.
    Remember the saying: if it looks too good to be true it almost certainly is.
  • antrobusantrobus Forumite
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    happyhero wrote: »
    ...Once in the trust your property and savings/investments are protected from tax and any other attack basically........

    What is a Universal Wealth Preservation Trust (WPT)

    [FONT=&quot]The Wealth Preservation Trust (WPT) is a ‘life interest trust’. When you protect your assets with a WPT you grant yourself a life interest in the trust and the settlor is known as the ‘principle beneficiary’. This means that you have the right to reside in any trust property (which may be your matrimonial home or normal residence) or you are entitled to the income if the trust fund consists of cash or investments. After your death, the WPT becomes a ‘discretionary trust’ and as such those assets are held on trust for your chosen beneficiaries through a letter of wishes. The WPT is a form of Asset Protection as it is a trust set up during the lifetime of the settlor. [/FONT]

    http://universalwealthpreservation.blogspot.co.uk/2013/11/what-is-universal-wealth-preservation.html

    I don't think that kind of arrangement will protect against IHT (see gift with reservation) or indeed a LA seeking payment of care home fees (see deprivation of capital). And discretionary trusts are actually subject to an almost penal level of taxation these days.

    Get proper professional advice from an independent solicitor or accountant.
  • edited 16 March 2017 at 11:11AM
    ColdIronColdIron Forumite
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    edited 16 March 2017 at 11:11AM
    {Text removed by MSE Investigator}

    Interestingly in their FAQ the answer to the question "Should I Seek An Opinion From My Financial Or Legal Adviser?" the answer is a roundabout No
  • happyherohappyhero Forumite
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    Thanks, although this trust is supposed to protect against the home being taken to fund the care fees we are all adamant in the family that we are going to avoid either my mother or step father going into care unless it becomes absolutely necessary i.e severe medical problems so she did not take it out for this reason. Also they have told us "as long as the trust is taken out at a time that you could not have foreseen going into care" that the money or property cannot be touched, i.e. to deliberately take out the trust to avoid paying care home fees results in the trust not being able to protect anything.

    The house they live in is worth about £500,000 and obviously will go up slowly and between them they have about £300,000 in investments (my stepfather was a keen investor but no longer trades as his mind is not up to it any longer) and this means there will be a potential for significant inheritence tax. The trust promises to protect the property and investments from IHT and on googling this it does seem to be the case with trusts Plus there is a facility to pass money to your children by way of a special type of loan thus protecting this money from divorce for example as debts have to be paid off first, before pay outs for any other reason.

    I'm probably not explaining it the best but it offers lots of protection basically in different ways and if someone had had it for a few years it would be great to help us to know their experiences with it all, good or bad.
  • bigadajbigadaj Forumite
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    Such arrangements are often challenged, it's normally the case that you don't get something for nothing and so have to give something up to exclude it from your estate.

    The other thing is that with two allowances to use up the total assets aren't radically above the iht limits, particularly as you'd expect capital to be run down over time, and potential for downsizing or similar.

    It's rarely good to let the tax tail wag the dog, whether that be in benefits, investment or avoidance of taxes or care.
  • edited 16 March 2017 at 11:17AM
    jimjamesjimjames Forumite
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    edited 16 March 2017 at 11:17AM
    {Text removed by MSE Investigator}

    {Text removed by MSE Investigator}

    Who are they regulated by? Solicitor body? Tax body? FCA? Accountant professional body?

    None of these are mentioned so it would seem you have no recourse to any complaint procedure if they don't deliver what is promised.
    happyhero wrote: »
    I like to think I am not easily swayed or taken in and both guys seemed nice genuine people plus I felt what they said made sense.
    From their website it appears they are more salespeople than anything else - they pay introducer fees for other people to pass business on.

    {Text removed by MSE Investigator}
    happyhero wrote: »
    I thought it was a good thing but my mother is now thinking of backing out and I must admit if she keeps being against it it does start to make me have doubts even though I was sure about it up till now.

    If she isn't confident then you should suggest she takes proper advice. Otherwise she could be £4000 out of pocket and not have any benefit from spending that.
    Remember the saying: if it looks too good to be true it almost certainly is.
  • Just been reading up on this company, is there anyone out there that has actually used their services, if so how did they rate them?
    I was considering allowing a rep into my home following a recent seminar, it sounded impressive but I would like to hear of any actual impartial recommendations -or otherwise.
  • jimjamesjimjames Forumite
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    Loony_tune wrote: »
    Just been reading up on this company, is there anyone out there that has actually used their services, if so how did they rate them?
    I was considering allowing a rep into my home following a recent seminar, it sounded impressive but I would like to hear of any actual impartial recommendations -or otherwise.

    Before you allow them in why not ask your solicitor or financial advisor what they think?

    No way would I invite someone from a company like this into my home. It's bad enough being at a seminar but why would you let them come to you?
    Remember the saying: if it looks too good to be true it almost certainly is.
  • I went to a seminar 2 or 3 years ago similar to this although it was to protect against care home fees not IHT.I was quite taken with it but didn't proceed,it was around 3k per couple and included the cost of probate and they stated that they would fight the L A if they tried to counter it at no cost to ourselves.It was organised by an IFA firm and they even had Justin Urqhart Stewart as a guest speaker.Im speaking from N E Scotland so the laws probably a bit different in our case.
  • xylophonexylophone Forumite
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    With regard to deprivation:-


    http://www.ageuk.org.uk/Documents/EN-GB/Factsheets/FS40_deprivation_of_assets_in_the_means_test_for_care_home_provision_fcs.pdf?dtrk=true

    Disposal of assets is not necessarily carried out to avoid a charge for accommodation or to gain assistance sooner than would otherwise have been the case. The local authority or Pension Service has to show that this intention was there before it can take transferred capital into account.

    There is no law to prevent people from (legally) arranging their affairs to pay as little Inheritance Tax as possible?
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