Telephone: +44 (0)161 241 9400


Address: 13 Cobden Street, Chadderton OL9 9LE


Trusts can be created to take effect immediately during your lifetime by way of a settlement or on your death through a Will Trust.

There are a variety of trusts which may be created. The most common trusts include:

Discretionary Trusts

These Trusts are common when you wish to preserve assets from divorce, care home fees or potential Inheritance Tax.  Assets in the Trust are disregarded from financial assessments as none of the beneficiaries have a right to the Trust fund.  Therefore, if they are created correctly, they can prove effective.  However, you must be aware of the pitfalls of the Trusts, namely the tax consequences relating to Inheritance Tax, Capital Gains Tax and also Income Tax.  Unless you are adequately advised, you may find that the downside of the Trust far outweigh the benefits you wish to attain.

These types of Trusts are often referred to as Property Protection Trusts. They are the same.

Life Interest Trusts (Interest in possession Trusts)

These Trusts are created for a number of reasons, the common one being where a person is worried about re-marriage.

The Trust allows the income to be paid to the person during their lifetime or perhaps they may have a right to live in the property during their lifetime.  Upon their death, remarriage or stated circumstance, the Trust ends and the funds are paid to your nominated beneficiaries.

If a person is on means tested benefits or receive Local authority care, then the income from the Trust is taken into account.

Disabled Persons Trusts

 If you have a child suffering from mental or severe physical disability, then this type of Trust can be extremely beneficial.  They are however very specialist Trusts and thus it is important that you understand how they operate.  Most practitioners advise on a Discretionary Trust (above), however, Disabled Persons Trusts carry their own advantages.

To complicate matters, these types of Trusts can follow either Discretionary-style Trusts or Interest in possession style Trusts.  If you are wishing to preserve means tested benefits then the former serves as a better option.  However, the latter allows for a constant stream of income.  The tax regime relating to these Trusts vary to those mentioned above and therefore before taking the decision of straightforward Discretionary Trusts, you should discuss whether these Disabled PersonsTrusts are a suitable alternative.

There are also less talked about trusts including:

•Bare Trust
•Protective trusts
•Charitable trusts
•Personal Injury trusts
•Pilot trusts

Whatever your reason, when creating any type of Trust, it is important that you have advice from a suitably qualified person.

Trusts are a complex area of law and it is important that your advisor is able to guide you on different types of Trusts and their related tax consequences.  We here at Touch Solicitors will look at your individual circumstances and what you are trying to achieve.  We will then tailor a Trust that will abide by the Law and achieve your desired result.


Mr and Mrs Wood“ Very knowledgeable and explained the complexities very well”