Future requirements
We are seeing growing demand from clients for inheritance tax planning solutions with greater flexibility that can adapt to their changing needs. More flexible trusts are entering the market, such as lifestyle trusts, where people can choose whether to take withdrawals from the trust depending on their circumstances at the time. With the increase in life expectancy and growing care costs, it is becoming more difficult for people to predict what their income requirements might be in the future.
It is important to remember that trusts do not just offer taxation benefits, they can help provide ways to navigate complex family situations. Trusts give people the opportunity to gain greater control over the distribution of wealth on death – a scenario such as the recent Ilott case, where a lady challenged her mother’s will after it was left entirely to charities, would unlikely occur as the Inheritance Act does not apply to trusts. Also, distribution of trust assets against the terms of a trust would be a breach and could be legally challenged. An added bonus is that trusts are confidential, so unlike wills, they do not become public knowledge.
Phil Carroll is proposition director wealth for Intrinsic
