Will Trusts

A trust is a legal arrangement where you (the "settlor") transfer ownership of assets to trustees, who manage those assets for the benefit of your chosen beneficiaries according to rules you set.

Think of it like this: instead of giving someone a gift directly, you put it in a locked box with instructions on when and how they can access it. The trustee holds the key and follows your instructions.

The three key roles in every trust:

1. The Settlor (you)

The settlor must own 100% of the assets being placed into the trust.

• Creates the trust
• Decides what goes into it (property, money, investments)
• Sets the rules for how it operates
• Chooses the trustees and beneficiaries

2. The Trustees

• Legal representatives of the trust
• Manage the assets according to your instructions
• Have a legal duty to act in the beneficiaries' best interests
• Cannot benefit personally from the trust unless they are a named beneficiary

3. The Beneficiaries

• People who benefit from the trust
• Don't own the assets directly until the settlor has either passed away or the trust is dissolved
• Receive benefits according to the trust terms (income, capital, or both)

How trusts work in practice

Let's use a Buckinghamshire example. John from Olney owns a £400,000 house. He creates a trust in his will. When he dies:

• The house doesn't pass directly to his beneficiaries
• Instead, it transfers to his trustees (perhaps his wife and adult son)
• The trustees manage the property according to John's instructions
• His wife can live in the house for her lifetime (beneficiary of the trust)
• When she dies, the house passes to John's children (remainder beneficiaries)

This achieves something a simple will cannot: John protects his wife during her lifetime whilst guaranteeing the house eventually goes to his children, even if his wife remarries.

For most Buckinghamshire families, a straightforward will is perfectly adequate. Trusts are powerful tools, but they're not necessary for everyone.

You probably DON'T need a trust if:

• You're in a first marriage with straightforward family dynamics
• You're leaving everything to your spouse, then your children
• Your children are responsible adults with stable lives
• Your estate is under £1 million (for a couple)
• You have no concerns about beneficiaries' ability to manage money
• Your family gets along well with no disputes

For this situation: A standard mirror will for £350 does everything you need.

You MIGHT benefit from a trust if:

Scenario 1: Second marriages and blended families

You're married (or in a relationship) but have children from a previous relationship. You want your current partner to be secure, but you also want to protect your children's inheritance.

Olney example: Sarah remarried at 60. She has two children from her first marriage. If she leaves everything to her new husband in a standard will, and he then remarries after she dies, her children could get nothing. A life interest trust lets her husband live in the house but ensures her children inherit it eventually.

Without PPT trust: Everything → Husband → His new wife → Her children (your children get nothing)

With life interest PPT trust: Husband lives in house → When he dies → Your children inherit

Scenario 2: Protecting vulnerable beneficiaries

You have a child or family member who:

• Has a disability and receives means-tested benefits
• Has substance abuse or gambling problems
• Is financially irresponsible
• Is in a failing marriage (risk of divorce settlement)
• Has mental health issues affecting decision-making

Milton Keynes example: A couple have three children. One has autism and receives PIP and Universal Credit. If he inherits £100,000 directly, he loses his benefits. A vulnerable persons / discretionary trust lets trustees provide for his needs without affecting his benefit entitlement.

Scenario 3: Inheritance tax planning

Your estate exceeds the inheritance tax threshold. For 2025/26:

• £325,000 nil-rate band per person
• £175,000 residence nil-rate band (if leaving home to direct descendants)
• Total: £500,000 per person, £1 million per married couple

If your Buckinghamshire property alone is worth £600,000, plus savings and pensions, you're potentially in the inheritance tax zone (40% on everything above the threshold).

Certain trusts can help legitimately reduce inheritance tax, but this requires specialist advice.

Our honest assessment: If your estate is over £2 million, you need a specialist tax advisor or solicitor, not a will writer, which we also have in house. If you're between £1 million and £2 million, we can probably help with relatively straightforward trust planning. We can advise accordingly.

Scenario 4: Young beneficiaries

Your children are under 25 and you're concerned about them inheriting large sums too young.

A simple will leaves everything to them at 18 (or whenever you die if they're already over 18). A trust can:

• Hold inheritance until they are 25, 30, or whatever age you choose
• Release funds in stages (25% at 21, 25% at 25, remainder at 30)
• Give trustees discretion to advance money for education, property deposits, etc.

Newport Pagnell example: Parents of an 18-year-old created a trust releasing funds in thirds at ages 25, 30, and 35. The son inherited the first third just after university and used it for a house deposit. The second third came when he was established in his career. The final third arrived when he was mature enough to invest it wisely. We can also advise on an 18 to 25 persons trust.

Scenario 5: Business owners

We also draft business wills, ensuring trustees continue to operate the business or allowing them to dissolve it. This allows the trustees and executors to claim Business Property Relief (BPR).

You own a business and need succession planning to:

• Ensure the business continues if you die suddenly
• Protect the business from inheritance tax
• Provide for non-business-involved family members whilst preserving the business

This usually requires specialist business trust planning that we provide.

The honest decision framework

Ask yourself:

1. Is my family situation straightforward? (First marriage, adult children, everyone gets along)
2. Is my estate under £1 million (£325,000 per person or per settlor)?
3. Are all my beneficiaries capable of managing an inheritance?
4. Do I trust everyone to do the right thing?

If you answered YES to all four: You probably don't need a trust. A standard will is fine.

If you answered NO to any: Book a consultation and let's discuss whether a trust would help your specific situation.

At Maple Wills, we'll always tell you honestly if a trust is unnecessary for your circumstances. We'd rather have your trust and confidence that you are advised correctly than your money.

Trust costs vary significantly depending on the type of trust, complexity, and whether it's created in your will (will trust) or during your lifetime (lifetime trust).

Will Trusts (PPT) — created in your will, active after you die

Simple life interest trust PPT (for couples in second marriages):

• £850 to £1,995 for mirror wills with life interest trusts
• This is our most common trust will for Buckinghamshire couples

Discretionary trust for vulnerable beneficiaries:

• £950 to £1,400 depending on complexity
• Includes detailed trust deed and letter of wishes

Flexible nil-rate band discretionary trusts (for IHT planning):

• £1,200 to £1,800 for couples
• Complex tax planning and detailed documentation

Lifetime Trusts — created and funded during your lifetime

Property protection trust (FAPT+):

• From £4,500 for the trust deed (this is a bespoke service we provide)
• Plus legal fees for transferring property into trust: £500 to £1,000 inclusive
• Plus Stamp Duty Land Tax considerations (normally non-payable)
• Plus a single fee of £175 for trust registration

Discretionary gift trusts:

• £800 to £1,500 depending on assets and beneficiaries

Bare trusts (simple trusts for children):

• £400 to £800

Our pricing at Maple Wills

We're transparent about costs:

• Mirror wills with life interest trusts: £950 (most common for blended families)
• Discretionary trust wills: From £1,100
• Property protection trust deeds: £1,800 (including consultation and drafting)

This includes:

• Initial consultation to assess if you need a trust
• Detailed explanation of how the trust works
• Drafting the trust deed or will
• Guidance on choosing trustees
• Letter of wishes (setting out your intentions for trustees)
• Storage of documents

What's NOT included:

• Asset transfers (property, shares): these require solicitor conveyancing
• Ongoing trust administration after your death (trustees can hire accountants or solicitors if needed, paid from trust funds)
• Tax return preparation for the trust (if required)

Beware of hidden costs

Some providers advertise low headline costs but charge separately for:

• Home visits (we include these free of charge)
• "Trust registration services" (unnecessary at setup for most will trusts)
• Annual "trust review fees" (often £150 to £300 per year — you do not need this)
• Storage and membership fees for trust documents (Maple Wills provides storage for just £3 per month)

Ongoing costs after the trust is created

Will trusts (PPT) — active after you die:

• Usually no ongoing costs until death
• After death, trustees may need an accountant for trust tax returns: £300 to £800 annually (if trust has income over £500)
• A solicitor for complex trust administration: £150 to £300 per hour (only if needed)

Lifetime trusts:

• Trust registration with HMRC (free but time-consuming)
• Annual tax returns if trust has income or gains (if it is your main residence, no annual tax return is required)
• Professional trustee fees if you appoint a solicitor as trustee: £1,000 to £3,000+ per year

Most family trusts with family members or beneficiaries as trustees have minimal ongoing costs.

Is it worth the cost?

Let's look at real numbers:

Case study: Newport Pagnell couple, second marriage

• House worth £420,000
• His children from first marriage, her children from first marriage
• Standard wills: £350
• PPT life interest trust wills: £850 to £1,995
• Extra cost: £600

What the extra £600 has bought:

• Peace of mind that his children will inherit his share of the house
• Security for his wife to live there as long as she needs
• Prevention of a potential £200,000+ dispute between the two sets of children
• A clear legal framework that cannot be challenged

Value delivered: Priceless family harmony and protected inheritance.

Case study: Milton Keynes family with disabled child

• Estate worth £680,000
• One child receives means-tested disability benefits (£18,000 per year)
• Standard will: Direct inheritance of £226,000 → Loss of all benefits
• Discretionary trust will: £1,200 → Benefits protected, inheritance managed by trustees

What the £1,200 bought:

• £18,000 per year in benefits protected for potentially 40+ years = £720,000+ in lifetime benefit value
• Professional management of inheritance for vulnerable beneficiary
• Protection from financial exploitation

Value delivered: £720,000+ in protected benefits, plus appropriate care for vulnerable child.

The upfront cost of a trust is almost always significantly less than the problems it prevents.

The main difference is timing: when the trust is created and when it becomes active.

Will Trusts (Testamentary Trusts)

• Created: In your will document
• Active: Only after you die
• Funded: With assets from your estate after death

How they work:

You write provisions into your will saying "when I die, certain assets should be held in trust rather than passing directly to beneficiaries."

During your lifetime:

• The trust doesn't exist yet
• You retain full ownership of all your assets
• You can change or remove the trust provisions any time by updating your will
• No tax implications or registration requirements

After your death:

• The trust automatically comes into existence. HMRC trust registration is required, and conveyancing documentation will be drafted
• Your executors transfer the specified assets into the trust
• Trustees begin managing those assets according to your instructions
• Annual minutes will be required

Most common will trusts we create:

• Life interest trusts: Spouse benefits during lifetime, children inherit afterwards
• Age-contingent trusts: Children inherit at specified age (often 25 or 30)
• Nil-rate band discretionary trusts: IHT planning for larger estates
• Disabled beneficiary trusts: Protecting means-tested benefits

Advantages of will trusts:

• No immediate cost or complexity during your lifetime
• You can change your mind any time before death
• No registration with HMRC required until after death
• Assets stay in your control while you're alive
• Simpler and cheaper to set up than lifetime trusts

Disadvantages of will trusts:

• No benefit during your lifetime
• Cannot protect assets from your own care fees (only active after death)
• Depends on executors properly implementing the trust
• Less flexible than lifetime trusts for tax planning

Lifetime Trusts (FAPT) — Inter Vivos Trusts

• Created: While you're alive, through a trust deed
• Active: Immediately upon signing documents
• Funded: You transfer assets into the trust now

How they work:

You create a separate legal document (trust deed) establishing the trust. You then transfer ownership of assets (property, money, investments) to the trustees, including the settlors. The trust exists and operates immediately.

From that point:

• The trustees legally manage the assets (not you)
• You no longer personally own what you've put in the trust, and it sits in the settlor and trustee names (typical example: mother, father and children)
• The trust operates according to the rules you have set
• Must be registered with HMRC Trust Registration Service
• Annual minutes are required

Most common lifetime trusts we create:

• Property protection trusts: Transferring your share of property to potentially protect from care fees
• Gift trusts: Giving assets away to reduce IHT, but retaining some control
• Asset protection trusts: Protecting wealth from business risks or divorce
• Grandparent trusts: Setting aside money for grandchildren's futures
• Vulnerable persons trusts
• Legacy trusts

Advantages of lifetime trusts:

• Immediate asset protection benefits
• Potential IHT savings (if you survive 7 years after funding; this applies to settlors exclusion trust)
• Trustees have full control for care fee assessment (in some circumstances)
• Active during your lifetime when you might need protection

Disadvantages of lifetime trusts:

• More expensive to set up (£4,000+)
• You give up legal ownership of the assets
• Must be registered with HMRC (bureaucratic burden)
• Difficult to unwind if circumstances change
• Potential tax implications, although this does not apply to your main residence (IHT, CGT)
• Cannot easily change your mind once funded

The Buckinghamshire decision framework

Choose a WILL TRUST (PPT) if:

• You want to control what happens after you die
• You're concerned about second marriage inheritance issues
• You want to protect young beneficiaries
• You need IHT planning but don't want to give up assets now
• You want maximum flexibility to change your mind
• You have blended families or want to ensure unequal shares to the beneficiaries

Choose a LIFETIME TRUST (FAPT) if:

• You need family asset protection now
• You're concerned about care fees in the relatively near term
• You want to make gifts but retain some control
• You're doing sophisticated IHT planning and can afford to gift assets
• You have specific business or divorce-related asset protection needs

Our recommendation for most Olney and Milton Keynes families

Start with a PPT (will trust). They're cheaper, simpler, and give you flexibility. You retain ownership of everything during your lifetime. If your circumstances change (health deteriorates, care becomes likely), you can then create a lifetime trust if appropriate.

Lifetime trusts (FAPT) are powerful tools, but they're permanent decisions with significant costs. Don't rush into them.

The exception:

If you're in declining health and care is likely within 2 to 3 years, a lifetime trust (FAPT) may be too late (local authorities can challenge trusts created as 'deliberate deprivation of assets'). In this case, accept that care fees are a legitimate cost, or explore other options.

Property in a trust is managed by Trustees, these are individuals left in charge of how the Trust is run.

The people who are entitled to the benefit of the property in the Trust may be different individuals, referred to as Beneficiaries. The Trustees hold the trust assets in accordance with the terms of the Trust, but they do not own them in their personal capacity.

The Trustees are effectively custodians of the Trust property for the time that the Trust is in existence.

A Trust is an arrangement that determines a specific way of managing assets. It is created either by circumstances or a specific legal document that states how the assets should be managed and by whom.

An estate is the term used to refer to everything which is owned by an individual.

This may comprise bank accounts, shares, investments, household items and property. A person’s estate is everything they own and have the right to benefit from or enjoy.

Gifting your property outright to family members is very risky and does not have any practical benefit, as it does not protect you from care fees or from inheritance tax. In fact, you risk losing your home if the person you gifted it to passes away, loses mental capacity, becomes bankrupt or gets divorced. Instead, Asset Protection Trusts can be more protective and can ensure that your house is used and managed in a way you can dictate within the trust. In a way, Trusts can help you to control how assets are managed after you have given them away. This may have the effect of ring-fencing your property from other assessments (e.g. care fees), but please note this is not always effective and depends on the circumstances. Putting your house into trust is a personal decision which should not be made lightly.

There are disadvantages of doing so, and you must carefully weigh these up before deciding on a way forward. For example, once you put your house into trust, it is held by the Trustees in accordance with the rules in the trust.

If your intention is to avoid paying for care, putting your house into trust may be seen as ‘deliberate deprivation ’, and it may still be taken into account for care funding purposes. Please ensure you talk to one of our specialists if you are considering whether this step is right for you.

Beneficiaries generally have a right to enforce the terms of the Trust and to hold Trustees accountable for their actions.

As a result, Trustees should provide beneficiaries with basic information, such as a copy of the Trust document and Trust accounts.

Please note that beneficiary rights may vary depending on the type of Trust. If you are a potential beneficiary under a Discretionary Trust, for example, you do not have any right to any part of the trust fund as this is at the discretion of the Trustees.

Ordinarily, people tend to choose close family or friends whom they trust the most and consider competent, fair, responsible and honest, although it is sensible to consider appointing at least one trustee who is a generation down from you and whether, by appointing one family member, it would cause animosity within the family.

Whilst it can be helpful to appoint a personal friend or a close family member to act as a Trustee for a number of reasons, there is the possibility that they may not be even-handed, whereas an independent trustee, such as Maple Wills, would make decisions impartially as they would not have a financial or personal interest in the trust or its assets.

If the value of your estate on your death is above the current £325,000 threshold known as the nil rate band, the amount above it might be liable for tax at the rate of 40%. Planning is essential to try and reduce this tax liability, as certain beneficiaries such as charities, spouses or civil partners may be exempt. In addition, leaving your primary residence to children or grandchildren may increase your personal allowance before liable for inheritance tax to £500,000.

Bare trusts can be used to hold assets for children to ensure the funds are not used until they are adults and able to make financially sensible decisions themselves. Funds held in the bare trust can be accessed for the children’s benefit before they turn 18, for example to pay for school fees. Transfers into a bare trust also have the benefit that they may be exempt from Inheritance Tax, as long as the person paying the funds into the trust survives for 7 years after making the transfer.

Trusts are usually considered to be distinct ring-fenced assets, although there are some circumstances where the value of the Trust is included/considered as part of your estate for tax purposes only.

For example, the beneficiary of a life interest trust has the right to benefit from the trust assets during their lifetime. If benefits continue up until that beneficiary’s death, the value of the trust at the date of their death may be added to their own estate value for the calculation of inheritance tax.

A bare Trust (i.e. held directly for the benefit of a specific individual) may also be considered as part of your estate.

Pros – Trusts can be very useful for controlling (to some degree) how assets are managed and used after you have given them away. In some circumstances, Trusts may also protect vulnerable beneficiaries from exploitation (by having someone who is independent control the funds for them) and may allow you to leave an inheritance for vulnerable individuals without impacting their benefit entitlement.

Some forms of Trust may also protect assets for (for example) your children in the case of their own divorce or where you would prefer the money to be given to them in stages rather than all in one go.

Cons – Trusts can sometimes be complex and difficult to understand. Depending on the Trust, we at Maple Wills explain everything step by step; this may also need to be registered with HMRC.

Trust accounts ought to be produced every year; we at Maple Wills provide advice accordingly. This depends on income-producing trusts. Having professional Trustees would certainly have its benefits here.