Gifting into a trust

Gifts into trusts are more complicated than giving an outright gift, but they do offer some advantages. They can be useful if you want to protect your money from divorce, bankruptcy of the recipient or from irresponsible spending. They can also be useful when providing for vulnerable beneficiaries.

Such transfers are taxable at the lifetime rate of 20% at the time of making the gift, however, only amounts above the NRB and outside the remit of reliefs and exemptions will be eligible to taxation. If the donor dies within seven years of making the gift the balance of the 40% tax due will be collected less any taper relief. With correct use and on meeting certain circumstances, Trusts are available that may be highly effective at removing assets from the Estate of several generations.