Inheritance planning / APTs (asset protection trusts)

ey143

Ok noted. But nobody here has given an indication of cost that I can see. What is an average and top end cost range?

Mattygroves2

Top end London specialist would be £500 an hour maybe more. If you budget for £1,000 for the setup of one Trust you'd probably be OK. The trick is to use the lawyers to draft the deed but do the transfers into the Trust yourself (except for property where you'll need conveyancing) and to avoid using a professional as Trustee. You'll need four Trustees so you'll need two friends as well as yourself and your wife.

Assuming you want a Discretionary Trust decide who you want the Trustees to be, who the beneficiaries will be, what you want the Trustees to be able to invest in, what restrictions you want to place on their discretion, whether you want to give Trustees the right to charge for their time, whether you want to give them the ability to borrow and any other restrictions that you want to place. Then when you speak to the lawyers you will save a lot of time.

There are some good HMRC pages that deal with the taxation of Trusts so read them carefully if you're not prepared to pay for an accountant's advice. Also worth trying to find a summary of the Trustee Acts of 1925 and 1932 which cover a Trustee's responsibilities.

You are thinking about setting up a vehicle and transferring assets into a new legal body and if you get it wrong as Trustee you are opening yourself up to legal action by the beneficiaries. If you do it and then decide you don't like it you need another deed to break the Trust which will be another £500 to £1,000. So better to spend the money upfront getting it right.

On an ongoing basis you could probably do the Trust tax returns so long as you're prepared to read the HMRC guidance.

ey143

Hi

I meant a simple trust for life assurance and death in service benefit rather than other assets. Surely not £1k for that?

Thx.

Your_Hero

ey143 wrote: »

Hi

I meant a simple trust for life assurance and death in service benefit rather than other assets. Surely not £1k for that?

Thx.

The DIS you can do yourself. It is paid out by a sort of discretionary trust arrangement so you can just change the nominations. However, it is not a binding agreement and trustees have total discretion to how it is distributed so there are no guarantees it will be paid out to your children as it will most likely be paid to your spouse first.

You may be able to put your existing life insurance into trust by contacting the provider who may have trust templates/forms ready to use at no additional cost.

As for setting up a new life insurance, probably won't cost you as much as £1,000, but it does depend on the size of the premium and complexity of advice. Life insurance is one of the few policies that still pay commission. The amount of commission received by the firm can be used to offset the total fees due.

Mattygroves2

ey143 wrote: »

Hi

I meant a simple trust for life assurance and death in service benefit rather than other assets. Surely not £1k for that?

Thx.

If you just want the DIS and life assurance to pay out to your children then all you need to do is complete the nomination form provided by your pension trustees and the company the life assurance is with. Be aware that the DIS is discretionary and the pension trustees can refuse to pay it but wouldn't if you want it to go to blood relatives. At my old employer partners ( rather than spouses) were excluded for example unless they could prove financial dependence.

You could set up a full discretionary Trust for the life assurance proceeds which is a deed so at least £500 but given the policy ceases after another couple of years that seems to be overkill.

RickyC_IFSWP

ey143 wrote: »

Hi

No, my life insurance policy nor my death in service benefits are pointing to any Trusts. I took out a policy when I was 20 to cover some large debts I had (now cleared) and left the policy running for 20 years (£8 pm month) and it expires in a few years time.

I now trade complex investments etc, including my own SiPP so can probably arrange a DIY Trust setup if anyone can pointe in the right direction.

Thx.

As YourHero mentioned, contact your insurance provider and ask them for a discretionary trust document. That should be your first port of call. Come back if they don't provide any.