ESTATE PLANNING
Protecting your children's inheritance, often referred to as Estate Planning or Bloodline Planning ensures your estate reaches your children, grandchildren and other relatives.
Without The Correct Bloodline (estate) Planning:
Assets Not Protected by a Trust Face Attack From:
-
Your spouse or partner may not inherit your share of the business
-
Some or all of your children's or grandchildren's (bloodline) inheritance could be lost
- Assets distributed to beneficiaries exposes those assets to risk
- Have you considered what might happen if your surviving spouse were to remarry? How would this affect your own children if he/she later changed their Will in favour of the new spouse and any subsequent children?
- For those of you who already have children from a previous marriage, how do you ensure that they would get their fair share?
-
The divorce or separation settlements of future generations
-
Creditors or bankruptcy claims
-
Their Care Costs and Further inheritance tax bills
-
What if your children are very young or have special needs? How can you ensure that they are fully provided for?
-
There may also be a business you have worked hard to build up. Surely you would want to protect this for your family too?
What To Do!
There are a number of ways in which your home, savings and business are vulnerable to attack (see Advice section below for more details). We’re here to safeguard these hard earned assets for you and your family, using simple but effective strategies (also covered in Advice section below).
Irrespective of your age or the value of your estate, making a Will, creating trusts and putting your affairs in order is one of the most important tasks that you are likely to undertake. We are happy to meet you in our office, or if you would prefer, we will arrange to visit you in the comfort of your own home, to assess your current situation, answer your questions and provide peace of mind for the future.
Our estate planning solutions are tailor-made to suit every set of personal circumstances and every pocket.
Looking after you, your family, and the generations to follow.
"If you have not yet made a Will, or any of the above applies to you then contact us today for a FREE no Obligation Chat"
ACT TODAY!
Advice
Asset planning in your lifetime
Some estate planning can be made whilst you are alive. Assets could potentially be gifted to Beneficiaries before your death. This could prove extremely Tax efficient in terms of Inheritance Tax, as assets gifted away are fully outside of the Donor’s estate seven years after the gift is made.
However, rather than gifting assets absolutely, as this would mean that these assets will again be potentially at risk from Divorce, Creditors and Long Term Care Costs, as well as adding value to the recipient’s estate, it would be wise to consider gifting with the aid of Discretionary Trusts. The Discretionary Gift Trust means that, although you make a Gift to your children and grandchildren, the asset need not enter theirown estate, thus protecting these assets from any possible claims on them in the future.
By Gifting to a Trust, the Donor retains full control but, cannot have access to the funds. Even if the Donor never received any benefit, but potentially could, the Gift is classed as a ‘Gift With Reservation of Benefit’ (GWR) and the full value is deemed to be in the Donor’s estate at death for Inheritance Tax purposes, not just the initial Gift. The Gift Trust ensures that a spouse, children, grandchildren and any other named Beneficiaries can benefit at the Trustee’s discretion.
Access to protected assets
We recommend a Discretionary Trust called a Probate Trust which, while still protecting assets from attack from Care Costs, allows the Settlor access to the assets held in the Trust. The Trust has a memorandum of wishes where the Settlor is also a Beneficiary. The purpose for utilising this Trust will be for ‘Bloodline Planning’ and not Inheritance Tax Planning, as a transfer of asset by the Settlor would be a GWR.
The main uses for a Family Probate Trust are the assignment of Investment Bonds to ensure it will pass to those intended without the need to wait for Probate. In addition, for a single/ widowed client, a proportion of the main
residence can be conveyed into our Probate Trust, which can protect the house from Care. Individual advice would be required as to whether this is an appropriate course of action.
Utilising Trusts for ‘Bloodline Planning’
It has been established that your children/ grandchildren’s future inheritance can beat risk from a number of issues. Taxation is one, but inheritances can be impacted from a number of other more emotional issues such as Care Costs, where an estate can be reduced significantly in value to pay for these costs. Family homes may have to be sold, and income and investments drained, seriously reducing any subsequent inheritance.
Family circumstances can also be a concern
It may be that there are some family members you would wish to benefit and some that you wouldn't. A classic scenario would be an individual who has married into the family, but who you wouldn’t want to benefit from your estate. Family disputes do occur and Divorce and/or Remarriage can greatly influence who inherits and by how much.
Subsequently, if on inheriting monies, an individual then divorces, that same Inheritance is at risk. Similarly, if an individual inherits assets but then is later subject to bankruptcy proceedings, or has creditors’ liabilities, then the whole Inheritance could beat risk.
The correct Trusts can provide the protection and control of a multitude of assets from those risks noted before. This protection can extend from the family home, to investment products and Family Businesses.
There are two potential scenarios where planning can be made with Trusts. One is during your lifetime and the other is in preparation for death. Wecan utilise a range of Trusts in conjunction with the Will, which will ensure that your hard earned assets are fully protected for your children and grandchildren. The type of planning is very much dependent on individual requirements and the value of the estate.