help for the newly widowed - discretionary trust

Lemonyspencer

Hi,
This is my first post, so forgive me, my ignorance if this has been discussed before. I have recently been widowed and have returned from the solicitor totally bewildered. My husband and I made wills, planned a discretionary trust and became tenants in common in 2004 to benefit our 5 year old son in the event of a death .
Unfortunately my husband died early this year and I am not sure whether to set up the trust for my son or to persuade the trustees/executors to gift the entire sum to me. We included a deed of variation in the will so as far as i am aware this is possible. What I need is a list of pros and cons for both.My son is now 8
Now the inheritance tax laws have changed is it better for me to hold it all?
I remember something about tax if trust lasts beyond child's age 18?
Are the fees expensive for maintaining a trust.
The estate is relatively small - A house £300,000 , no mortgage, £70,000 insurance plus a lump sum from pension- not sure if counted towards estate?
Any help really appreciated , thanks the solicitor was some what evasive

Mikeyorks

Lemonyspencer wrote: »

Hi,
I have recently been widowed and have returned from the solicitor totally bewildered.

Sorry to hear that ... on both counts.

My Mum was horrified to find herself in very much the same position this time last year but, significantly, with a much older family. Dad and her had taken Solicitor's advice leading up to tenants in common / trust several years prior ... and she was quite adamant the implications were fully lost on her.
She left me to sort out Probate and the first thing I did was get the Solicitors (Trustees were Mum + 2 {to be} nominated partners from the Solicitors) to sign a formal Deed of Renunciation. In order I could fully d/w Probate without the problems of 150 mile round trip to Mum with the Solicitors a further 100 miles away.
In essence that left my Father's 50% of the property in Trust ... but with Mum the sole Trustee. All other assets had been left directly to Mum in the mirror Wills.
After Probate - I discussed the matter of my Mum's Will with the senior Partner. And, on his advice, we simply re-drew that to obviate all mention of the Trust (that her 50% of the Property would go into .. on death) - leaving all other detail of beneficiaries etc the same.
Net result is the 50% pertaining to Dad is in Trust - but Mum is the sole Trustee. And the Solicitor's have no interest, now, other than the fact they hold the property Deeds / original of Mums Will. Which means that - on her death it will be a relatively simple (and not Solicitor dependent) matter to resolve the entire estate.

In your case - much depends on the data in the Wills - and how the Trust / Trustees are formed. As your child is relatively young - perhaps you would consider the Trust is the best way to protect his interest?

If he was 'evasive' ....that would worry me that there is consideration of further (highly) paid work in prospect for him. I was fortunate in that Mum's was initiated via an (ex) partner in the firm who was a relative ... and her sole 'get out' costs were drawing up her new Will.

But you really need to clear your head and have a further chat with the Solicitor to determine your best options?

Lemonyspencer

Hi, Thanks for the information
There are four trustees as we had to nominate people who would look after my son if we both died.
They are willing to go along with my wishes . I am just not sure which would be the best. I have asked the solicitor to write down the pros and cons of both approaches and an estimate of costs. .i.e. trust in my sons name or gifted to me.
thanks for your advise I appreciate the help.
I will study the information carefully, thanks again