Let”s keep this simple.
1. A Trust is an arrangement whereby persons (trustees) hold and administer property or money for the benefit of others (the beneficiaries)
2. Where the beneficiaries do not have the right to demand payment of the trust money, payment is within the ‘discretion’ of the trustees. Including how much when and how often. The creator of the trust defines the powers of the Trustees.
3. A Discretionary Trust is a vehicle for protecting the interests of a disabled child or grand child. The capital from a simple trust will reduce entitlement to benefits, it’s income. A discretionary trust will not effect benefits. The capital in the Trust is disregarded
4. A Trust is created in a Will or by drafting a Deed. Paul Darnborough Solicitors can taylor a Trust for the exact needs of a dependant child or grand child. Allocating money for the current and future needs of the dependant child. Appointing appropriate trusted Trustees. Give the Trustees sufficiently wide powers to enable the disabled child to be properly looked after. We can provide protection for the Trustees, provided they act honestly.
5. W e advise you leave a Letter of Wishes, which although not legally binding can direct in your own words how you want the Trustees to respect your wishes
6. Since 2006 Tax Law has been extended to benefit Trusts for disabled persons. A trust is still the most tax efficient vehicle to protect your child.
7, Speak to us in total confidence in this most stressful area of life and thereafter. Do the right thing.
So you know. Paul Darnborough is s Trustee in a discretionary trust for his disabled nephew. We know about this area of law from real life not a book. Contact us now in total confidence.