This guidance note explains the key reasons why people use trusts during their lifetime and on death.
Trusts are mainly used to pass assets and wealth down through the generations. Trusts have been used for many years to protect assets, control their management and to control how, when and if the assets are transferred to beneficiaries. Tax is also an important factor and trusts can be used as part of IHT planning.
For an explanation of the parties to a trust and the terms used when talking about trusts, see the What is a trust? guidance note. The Creating a trust guidance note sets out further details of how a trust is established.
Often the settlor of a lifetime trust will appoint themselves as a trustee and thus enables them to retain control over the assets. Alternatively, they may appoint a friend or relative or a professional in lifetime or in their Will alongside a letter of wishes detailing how they would like the assets dealt with.
Using a trust allows
**Free trials are only available to individuals based in the UK, Ireland and selected UK overseas territories and Caribbean countries. We may terminate this trial at any time or decide not to give a trial, for any reason.
Foreign tax reliefIncome and gains may be taxable in more than one country. The UK has three ways of ensuring that the individual does not bear a double burden:1)treaty tax relief may reduce or eliminate the double tax2)if there is no treaty, the individual can claim ‘unilateral’ relief by deducting
Taxation of dividend incomeIntroductionA dividend is a distribution of profit by a company to its shareholders.A dividend is not only a payment in cash. It can be the issue of new shares in exchange for forfeiting the right to a cash payment (a stock dividend). For more detail, see the Cash
Research and development expenditure credit (RDEC)This guidance note provides information on how research and development expenditure credits (RDEC) are calculated and utilised. The Qualifying expenditure for R&D tax relief guidance note provides information on what expenditure qualifies for