You can use a trust to give some or all of the benefits on your protection plan to other people. This means that the benefits you give away would not be part of your estate if you die, and would not be subject to inheritance tax. Inheritance tax is currently payable at 40% on any part of an estate valued over £325,000 If you don’t put your plan in a trust any money it pays out is added to your estate.
Your trusts are flexible, which means you have control over who wil be responsible for making sure that happens. When your 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, for example a payment following a Critical Illness claim.
If you put your plan in trust it allows your Life Insurance company to pay any claim you make more quickly than they could if the plan was not in trust. If you die without putting your plan 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 plan in trust can avoid this delay. We have several trust forms available. We can help you decide which one best suits your circumstance.
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