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What is a Trust?
There are different types of trusts.....one example being:-
 
DISCRETIONARY TRUSTS
A Discretionary Trust enables assets to be given away without actually giving to any individual.They have been a feature of UK Trust Law for
very many years, and much of the aristocratic wealth in the UK is held in such Trusts.
The assets are held by Trustees who have discretion to give the assets, or the income from the assets, to any person or persons named in the
Trust Document.
These people are called the beneficiaries and the class described in the Settlement Deed is normally very wide - often expressed as the
descendants of grandparents, but a spouse cannot be included while the donor is alive. It is in order to have a widow as a beneficiary.
The Trustees have complete discretion on how the assets and the income are to be dealt with amongst the named beneficiaries. It is therefore
important to choose the Trustees with care, although it is perfectly in order for the donor, i.e. the person putting the assets into the Trust, to be
one of the Trustees.
The Trust will have a perpetuity period of 80 years, and is allowed to accumulate income for 21 years. The Trust Deed is a legal document, and the
Trust has a status independent of the person who put the asset into Trust and the people that can benefit from the asset.
 
Inheritance Tax 
After a lifetime of hard work and sensible money management you might be planning to pass your wealth to close family and friends.
But unless you have planned for it, Inheritance Tax (IHT) may take a large bite out of what you leave them.
 
Currently everyone is allowed to leave up to 325,000 to his or her beneficiaries without incurring any IHT. This amount is known as the nil rate band.
Any amount exceeding 325,000 could be taxed at 40%. Normally the passing of assets between spouses does not give rise to an Inheritance Tax
liability.
 
You may think IHT won't affect you; that it is the rich man's tax. However, if you add up the value of all your assets, you might be surprised to find
the total does in fact exceed the nil rate band.
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