Money for Grandchildren

atush

No need for a solicitor othervthan to set. Upnyour will. You can set up now, in consultation. With your husband, some investments for them. I used. Investment trustcsavings plans. You can designate them to the child but they remain your property.

You gift them at an age/time you feel appropriate. And list them in your will.

justme111

atush wrote: »

No need for a solicitor othervthan to set. Upnyour will. You can set up now, in consultation. With your husband, some investments for them. I used. Investment trustcsavings plans. You can designate them to the child but they remain your property.

You gift them at an age/time you feel appropriate. And list them in your will.

p

so what is the point of using specific designated trusts - may as well use plain/ ISAd savings/investments

xylophone

If a bare trust is used, the children have to absolute right to access and control at the age of 18.

If you wish the parents to control when and if the children have access, then you will need a discretionary trust - read links in my post above for guidance on trusts and for the STEP website where you can find a solicitor with specialist knowledge.

Eco_Miser

evergreen wrote: »

Thank you so much for this detailed information. It seems that I would be better gifting this money myself rather than my husband.

I read redux's post as saying that you both should donate using last year's and this year's IHT exempt gift allowance (and next April with next year's allowance). This is assuming that IHT is a factor to consider.

redux

Eco_Miser wrote: »

I read redux's post as saying that you both should donate using last year's and this year's IHT exempt gift allowance (and next April with next year's allowance). This is assuming that IHT is a factor to consider.

It depends which part of my post she was thinking of.

If IHT is not and won't be involved for the couple, then it probably doesn't much matter what the exact details are, but yes, what I tried to suggest is use the annual gift allowances from both

For instance, in detail, using last and this year's allowances

X gives £3000 to A, £3000 to B, £250 to C, £250 to D
Y gives £3000 to C, £3000 to D, £250 to A, £250 to B

And some more from April.

As for larger transfers, the reason I suggested these come from the OP rather than the husband is this gives a better chance for potentially exempt transfers to run for 7 years. Again, this is only if IHT will be an issue eventually.

These gifts could be into trusts (if advice suggests these are suitable), but are still PETs for IHT purposes.

Part of the reason I suggested trusts is for some degree of reservation to protect the OP. One type I already mentioned above, and another involves loaning to the trust, the settlor is entitled to the loan back (unless all or part of the loan is also gifted/waived) and the beneficiaries will have the capital gain.

Proper financial advice needed if trusts are going to be looked at.

atush wrote: »

No need for a solicitor othervthan to set. Upnyour will. You can set up now, in consultation. With your husband, some investments for them. I used. Investment trustcsavings plans. You can designate them to the child but they remain your property.

You gift them at an age/time you feel appropriate. And list them in your will.

Can investment trust schemes or shares on other platforms be in a loan trust or discounted gift trust (or other types of trust), or are those types of device necessarily only an insurance-linked product?

evergreen

Thanks. Not sure if IHT would be involved. Depends on value of our house I suppose. We were thinking about £15000 for each child. Maybe a little more.

xylophone

Do you want the children to have access and control at age 18?

Arthurian

Thanks, Redux, for your helpful link, which then took me to the relevant gov.uk site. I had not realised that “payments to help with another person’s living costs, such as an elderly relative or a child under 18” were exempt from IHT. I wonder if a large one-off payment of several thousands of pounds towards school fees, both now and for future schooling, would be covered by this exemption or if it would have to be regular payments?

redux

Arthurian wrote: »

Thanks, Redux, for your helpful link, which then took me to the relevant gov.uk site. I had not realised that “payments to help with another person’s living costs, such as an elderly relative or a child under 18” were exempt from IHT. I wonder if a large one-off payment of several thousands of pounds towards school fees, both now and for future schooling, would be covered by this exemption or if it would have to be regular payments?

I forgot to mention that part. I think gifts from one's regular income can be free of IHT consideration, but I don't know who arbitrates how much and what is allowed.

I assume that some families who foresee school fees start funding them when the kid is young. I also assume that the richest people are the most expert at having advice on PETs, trusts and so on. IHT seems to be mostly for the people between poorest and richest.

Straying a bit from your question, I remember reading a few years ago a suggestion that if potentially exempt transfers are made, the risk of inheritance tax if the person doesn't survive 7 years can be mitigated by using tapering life insurance to cover it, and even the premiums for this could be gifted from income. I don't know if this is still true.