Life Interest Trust

Common reasons for creating a life interest trust

A life interest trust can allow you to protect your family home in relation to care home fees. People also choose to create this type of trust in order to give a beneficiary a regular income.

As well as deciding who should receive the life interest, you’ll need to consider who will receive the capital. A provision will need to be put in place for when the interest is to come to an end. An example of this would be when someone cohabits, remarries or dies, at least in relation to property.

Advantages of a life interest trust

• You can pay a regular income to your beneficiaries (who will become known as the life tenant)

• A person’s share of a property can be placed into the trust to protect it from potential financial assessments such as when they require care

• It protect your beneficiaries, such as your children if your spouse were to remarry

Why is legal assistance recommended?

Trusts can be complex. Timing, wording, and individual circumstances are very significant when it comes to setting up a life interest trust.

A solicitor can help you with:

• Working out which trust is best

• Deciding what conditions to include

• Determining whether you can save on taxes

• Ensuring your trust doesn’t conflict with your will

• Advising what to consider when it comes to appointing trustees