How to Use Trusts to Reduce Inheritance Tax

Trusts can be a powerful way to pass on wealth, protect the people you care about and potentially reduce your family’s future Inheritance Tax bill. But they can also seem complicated.

This guide explains how trusts work, the different types available and when they might form part of a wider Inheritance Tax planning strategy.

This guide covers:

How trusts work, including the roles of the settlor, trustees and beneficiaries, and why assets placed into a trust may no longer form part of your estate for Inheritance Tax purposes.
The main types of trusts used in Inheritance Tax planning, including bare trusts, discretionary trusts and interest in possession trusts, and the situations where each may be appropriate.
How trusts can help protect family wealth, giving you greater control over who benefits, when they receive assets and how wealth is passed between generations.
What to consider before setting up a trust, including tax rules, reporting requirements, ongoing administration and the importance of structuring a trust around your individual circumstances.