Trusts can be used as a way of protecting your assets.
They allow for property and assets to be held by trustees for the benefit of one or more individuals - these can be adult or children. These individuals are known as the beneficiaries.
Commonly trusts are set up for assets to be held for the benefit of children until they reach a certain age.
Trusts are taxed independently for income tax, capital gains tax and inheritance tax purposes. This makes them an effective means of separating your estate to avoid tax.
A trust means that you assign responsibility for the finances over to a trustee. Trustees have various duties and powers which are given to them either by the general law, the Trust deed (or Will) or a combination of both. It is essential that a Trustee understands the duties imposed on him and the powers available.
This can be quite a demanding role and you should know what’s involved before agreeing to become a trustee.