Trusts

The Basics

A Trust allows you to give some or all of the benefits from your insurance plan (life / critical illness etc) to other people. This means that the benefits you give away would not be part of your estate if you die and therefore would not be subject to inheritance tax (IHT).

Inheritance tax (IHT) is currently payable at 40% on any part of the estate valued over £325,000 (from 6 April 2009). If you don't put your plan in trust, any money it pays out is added to your estate.

Trusts are flexible

Trusts are flexible, which mean you have control over who will benefit from your cover and who will be responsible for making sure that happens.

When you are setting up a trust, you have control over who will administer any money paid out from a claim (the trustees) and who will benefit from any money paid out (the beneficiaries). You can also make sure you receive any benefits that you want to keep for yourself eg a payment following a critical illness claim.

If you put an insurance policy in trust, it allows the claim to be paid more quickly than if the plan was not put into trust. If you die without putting your policy in trust, your representatives may have to obtain a Grant of Representation before they can deal with your plan. This process can take several months; putting your policy in trust can avoid this delay.

If we at Minerva Financial Services told you that we could offer you a product that:

• was free
• could save you 40p in the £1
• could save you months of legal wrangling

Would you be interested?

That product is a Trust. Putting your plan in trust:

• is free
• may mitigate inheritance tax
• avoids probate delays
• puts the money in the right hands

Note: Will and Trust advice is not regulated by the Financial Services Authority.