When you make a will and decide your family’s inheritance you make it based on current information about the relationships within your family. Most wills then are set up to distribute the assets ‘absolutely’. The potential issue with this is that these assets are therefore considered part of the beneficiary’s estate – not a problem if the situation remains the same.
Were things to change however, you could find that the money you leave is subject to unwanted influence. So how can you ensure your will goes to the right people after a divorce, re-marriage or financial/business issues? Should the recipient need care you may also be able to protect against care costs.
Use Bloodline Planning to ring fence will funds
You can use bloodline planning to ensure funds are ‘ring-fenced’ or protected and stay within your bloodline as you define it. It’s a thorough procedure as it accounts for a number of possible situations within your family:
- Care Costs
- Further inheritance tax bills
- Bankruptcy/creditor claims
You can plan it to take effect during your life or it can be made in preparation for death – but of course it’s advisable to finalise plans when you can to protect against unforeseen circumstances.
If you decide to gift assets before your death it can be very effective in reducing the reach of inheritance tax. After 7 years such gifts are completely outside of your estate. Do so using a discretionary gift trust and the gift will not become part of the beneficiary’s estate – therefore it is protected against future claims.
Contact Prestige Tax and Trust Services
If you feel that this may be suitable for you please contact one of our skilled trust advisors. No hard sell, just clear-cut advice. We can arrange to visit you in your home to discuss your options.
For help with other elements of planning for the future using wills and trusts contact us via our website or on 0845 388 3454.