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Derbyshire Tax Services Ltd

Tax consultants & accountants for Derby, Derbyshire & the East Midlands
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Trust planning
What are trusts? 

  • Trusts (or settlements as they are also known) are often used as a means of distributing wealth within a family group.


  • They are very flexible because the trustees have complete discretion over whether the income and/or capital are distributed from the trust.


  • Generally, the beneficiaries have no legal automatic right to the income or capital held in the trust. 
Why do people use trusts?

  • During the settlor’s lifetime, trusts are often a more practical alternative than an outright gift, particularly in situations where the settlor considers it would not be appropriate to make an absolute gift to someone, e.g. their children or grandchildren.


  • They can also be used in situations where there may be a risk of bankruptcy or to protect against future matrimonial problems.


  • Trusts are also used to minimise inheritance tax by allowing the settlor to progressively transfer assets and wealth out of his or her estate.