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ontrary to their reputation, trusts are not just a tax-free ticket for the super-rich. In fact, it is the moderately wealthy who can best use them to shield their assets if they know how to navigate the rules.
Interest in trusts has boomed since it was announced last year that most pension pots will be included in an estate for inheritance tax purposes from April 2027. Lawyers and accountants say that their clients are nervous of a further raid on their estates by the chancellor, Rachel Reeves, in the budget on November 26.
Rachael Griffin, the head of tax and trusts at the wealth manager Quilter, said: “Every other call we get is from clients who were not concerned about inheritance tax, but now very much are, especially in light of the pension changes. And trusts are featuring early on in those discussions.”
When used correctly, putting assets in a trust can reduce an inheritance tax bill, or avoid one altogether; can make provision for family members and help with estate planning, particularly for families with complicated affairs.
