Put Your Trust in Barnet Wills to Protect Your Assets and Save Time, Money and Stress
Many Will writers shy away from using trusts because they can be complex and require a high level of expertise to draw up and manage, but they can be extremely effective when it comes to protecting your property and other assets.
At Barnet Wills, we have a wealth of knowledge that can help you and your loved ones to protect your estate and make significant cost and tax savings in the future.
What is a ‘trust’?
A trust is an obligation binding a person (which can be an individual or a company) called a ‘trustee’ to deal with ‘property’ in a particular way, for the benefit of one or more ‘beneficiaries’.
What is a Trust and how do they work?
To find out more about trusts, and how they work, watch this video
What is a ‘trustee’?
Trustees are the legal owners of the trust property. They are legally bound to look after the property of the trust in a particular way and for a particular purpose. Trustees administer the trust and, in certain circumstances, make decisions about how the property in the trust is to be used. The trust can continue even though the trustees might change, but there must normally be at least one trustee.
The property of a trust can include:
• land or buildings
• other assets, such as jewellery, paintings etc.
What is a ‘beneficiary’?
Anyone who benefits from the property held in the trust is a beneficiary. There can be one or more beneficiaries, such as a whole family or a class of people, and each may benefit from the trust in a different way. For example, a beneficiary may benefit from:
• the income only, or
• the capital only, or
• both the income and capital of the trust.
What is a ‘Settlor’?
A Settlor is a person who has put property into the trust. Property is normally put into the trust when it is created, but it can also be added at a later date.
How are trusts created?
Normally a trust is created by a deed. A Settlor might ask a professional adviser to draw up a trust deed, which then sets out the terms of the trust. A trust can be created under the terms of a Will, when someone leaves instructions that when he or she dies some or all of the estate is to be placed in trust. A trust can also occur if a person dies without leaving a Will.
Sometimes the courts will create a trust when, for example, deciding how to deal with property for the benefit of a child or an incapacitated person who cannot manage his or her own affairs.
Trust law and the taxation of trusts can be complicated, so if you want to create a trust you should seek professional advice from an expert, who can then draw up the trust deed for you, and give advice on related legal matters.
For objective, professional advice regarding all aspects of trusts, call Eli Pressman at Barnet Wills on 020 3189 1737 or email email@example.com
What are my responsibilities as a trustee?
Your responsibilities depend on the type of trust and the terms under which the trust is created. The Settlor may have given instructions that trustees carry out various functions, and trust law may impose further obligations, including:
• notifying the Inland Revenue that tax is due within six months of the end of the tax year for which it is due
• keeping records of the income and capital gains of the trust
• completing and sending back any tax return issued to you
• paying any tax due on the income or capital gains of the trust
• supplying certificates or vouchers to the beneficiaries to show how much income they have received from the trust in the tax year and how much tax the trustees have deducted. (Inland Revenue Trusts can supply forms for you to use)
Can trusts reduce or eliminate the amount of tax I pay?
Many people now look to using trusts as a means of mitigating tax which would otherwise be payable, and there are four types of tax that could affect you and your estate:
• Corporation Tax
• Capital Gains Tax
• Inheritance Tax
• Income Tax.
So whether you own your own business and your concern is Corporation Tax, own property or hold other forms of assets which would fall prey to Capital Gains Tax, or believe Inheritance Tax will become an issue for your intended beneficiaries, Barnet Wills Limited can provide you with the correct type of tax planning to ensure as much tax as possible is saved.
What happens when a trust ceases to exist?
If a trust is wound up, the Trustees should notify the Inland Revenue Trusts Office and complete a tax return for the period up to the date the trust is wound up.
Remember, you will need to make provision for any tax that may be due, and consider whether the ending of the trust gives rise to a capital gains tax liability. If the property of the trust is distributed before any outstanding tax is paid, then you might have to pay that tax out of your own pocket.
For expert advice and guidance regarding all aspects of trusts, call Eli Pressman at Barnet Wills on 020 3189 1737 or email firstname.lastname@example.org