Trust Assets

[123rob]

Mother and father executed “mirror” Wills in 2003. Each Will provided that a discretionary trust be set up on the first death with survivor to be given such capital as may be necessary. They owned their house as tenants in common. Two sons are the beneficiaries in the trust
Both parents separately have assets below the NRB. Mother died in December 2009 leaving father as survivor
Probate is expected to be granted within the next few days

How do the Executors(Father and one son)/Trustees(both sons) treat Mum's share of the house - do the Trustees arrange for it to be registered in the name of "The Trust Fund of XXXX"

Similarly, Mum's Bank accounts etc - do these have to be put into the name of her Trust

Thanks in anticipation of your help

Rob

[dennywren]

This type of trust was good tax planning in 1993 when it was made as it utilised the nil rate band of the deceased.

This changed about 2 years ago so you may want to consider a deed of family arrangment to cancel the nil rate band discretionary trust and for you father to inherit all your mother assets (no IHT due) and much simpler to arrange.

As such your mother will not use her nil rate band so this unused band will automatically pass to you father when he dies.

So when he dies he will get 2 nil rate bands at the time he dies. So if the nil rate band goes up to £1 million (per conservative view) 2 million will be exepmt from IHT on his estate.

email me if you want me to help you

[123rob]

Thanks dennywren for your reply but as father is now in his late 80's, would not putting all assets in his sole name cause problems if he had to have long term care

Regards 123rob

[Lee Young]

Undoing the trust would cause care fees issues if your father needed care. The best advice would be to see a solicitor who is expert in setting up these arrangements- the trust should ideally be funded by using IOUs and equitable charges, rather than actual assets, but this will depend on the exact wording of the trust provisions and powers. Feel free to contact me directly for such advice.

[Loza]

I agree with Lee that the assets should be kept in the DT given the care home issue, if you need to discuss further feel free to ring on 07790356873