vunrable perons trusts

[palamino]

Hi

I hope someone could help with a simple answer, as I have read many Web pages and tax pages, but have become more confused.

My husband is disabled on DLA , with bi-polar, I am looking for a way to help him protect his assets , as the illness results in him being unable at times to control his finances. Whilst I am here this is not a problem.
However i am worried (as we are both in our mid/late 60s and his illness is progressing), for the future.
I have considered transfering a rented property he owns to a trust, which I pressume would be An Asset protection trust.
But would it be allowable as a qualifying trust ?, as the assets are his ,which means he and only he as the settlor would be receiving benefit from the trust and the vunerable tax rates would not apply.

There fore the tax on the trust some 50% .

Any help would be gratefully received.
Thanks
Jean

[tax_schmax]

From what you say, it would appear that a power of attorney might be more appropriate. The protection a trust offers could be that the trustees are required to have the beneficiaries best interests at heart at all times. You could achieve this by carefully selecting the attorney. You should check with a lawyer the details around your husbands capacity to confer the power upon the attorney. It may be necessary for the Court of Protection to become involved.

[palamino]

Hi .
Thanks for the reply , put having already got an LPA and it having been registered at the court of protection in the past it proved useless in stopping , a person with a high in bi polar , being able to borrow money. At the same time under the mental health act they would not be classed as not having capacity. This was proven when he managed to have it de-registered.

[tax_schmax]

It would appear that a trust would perhaps be most suitable. The high taxes might be less damaging than having a useless Power of Attorney.

It is probably worth pointing out that if you are primarily concerned about borrowing being arranged against bricks and mortar, adding you as an owner of a small fraction of the property would stop lenders being able to register the charge on the property and therefore making them unwilling to lend, at least as far as mainstream lenders are concerned.

If you feel the trust would be the best option ,there are things that can be done to reduce the taxes in certain cases.