Putting house in trust - how to guide

kenzie123

I keep reading that it’s best to put your home asset in trust in order to protect finances for your children -
can someone explain this process?

What are the pros and cons and how do you go about it?
What will it mean when the homeowner passes away?

current situation is I have a home to pass on to my children - my will states this but not sure if putting it in trust will make the financial process easier for them?

Any advice appreciated - I’m not an expert in this area so may come back with further questions

flaneurs_lobster

Do you "keep reading" this advice on social media sites?

Is it by any chance advertising the services of companies that will perform the necessary legals for a modest fee?

Hopefully someone can post a link to some independent thoughts on this subject.

RAS

There are lots of posts here about houses put into trust that cost the children a lot of time and money to sort out when the parent(s) die. It has been a great source of income for some companies.

There are a few occasions when it can be useful.

The starting points are:

Are you married, widowed, divorced or single?

Are you the sole owner of the house, or do you own it jointly?

If you died tomorrow, what would the total value of your assets be? And how much is the house worth?

elsien

Also how old are you and are you in good health? Is this an attempt to make things easier for your children, or an attempt to avoid possible future care costs -what other assets do you have?

poseidon1

No one here is going to provide you with a speculative guide to putting either your own home or parent's home into a trust created during lifetime.

Ninety nine times out of 100 such trusts are a truly stupid idea by the person doing it, and normally result from unscrupulous companies ( or sometimes solicitor) selling the concept to an unsuspecting consumer on the basis of scaremongering tactics. These companies often use social media platforms such as Facebook and YouTube to ply their dubious wares.

The only trusts related to one's home worth considering ( in certain circumstances) are IPDI trusts created under the terms of one's Will which only comes into effect on the death of the first spouse.

The following article outlines the key rationale behind such trusts and where they can be particularly beneficial such as in the case of 2nd marriages and the blended families that can result therefrom -

https://www.pardoes.co.uk/blog/protective-property-trusts-explained#:~:text=The%20life%20tenant%20can%20move%20to%20a,property%2C%20with%20the%20approval%20of%20the%20trustees.

Yorkie1

Parents put their house and other assets into trust (not one where the surviving spouse gets to live in the house after the first person's death). Nightmare. Trust registration. IHT charges after every 10 years. Decisions needed as to who the trustees should be (if individual solicitors, there's a cost to change them when they move firm, retire or - in our case - were struck off!; no such issues for individuals such as you); impossibility to insure the property if the trustee of the trust is the solicitor's trust corporation.

Most estates will not be in IHT territory (unless the property is quite valuable, and/or from 2027 (I think) a pension will be included in the IHT calculation.

It will be an appropriate route in very few circumstances.

Keep_pedalling

Will it make things easier - No

Will it complicate things - Yes

Will it reduce taxation - No (look up gift with gift with reservation of benefit)

Will it increase taxation - Possibly (CGT)

Will it avoid care costs - No (look up deliberate deprivation of assets)

All the above also applies if you gift your home.

Dead_keen

https://forums.moneysavingexpert.com/discussion/6661787/putting-house-in-trust-how-to-guide

Have a read of this: https://taxpolicy.org.uk/2026/03/13/mp-estate-planning-trust-misselling-investigation/ It's a long read but you can skip to the "The pitch and the reality" first. Once you've read that bit, you could explain to us why you still want a trust.

buddy9

Researching ‘victims of Mcclure Solicitors action group’ might also offer good background.

Grumpy_chap

https://forums.moneysavingexpert.com/discussion/6661787/putting-house-in-trust-how-to-guide

Is your Estate likely to be subject to IHT?

Do you have adequate provision (financially) to meet all of your life wishes, including care needs should it be required?

Are you an UHNWI?

If the answer to all three of the above is "yes" it may be appropriate to consider establishing a family trust and your regular professional advisors will be best placed to answer any queries arising.