Setting up a trust allows you to keep control of the money rather than giving it away outright, and can help to avoid inheritance tax.
The simplest type is a bare trust, useful if you are giving away relatively small amounts of money. You effectively create a bare trust when you hold a unit trust, OEIC or investment trust in a designated account for a child. If you want to be sure the trust will work properly, it is best to make a formal declaration of trust. Any money put into a bare trust will be taken out of the inheritance tax net provided you survive for seven years after making the gift.
There are many forms of trusts each designed for a specific purpose. Due to the complexity of this area of financial planning, we strongly suggest you seek our help and guidance when you are considering the use of trusts in your financial planning.
Contact us for further information.