Asset Protection Trusts (APTs) are important estate planning tools for those who wish to protect their assets from many concerns including:
- Protection from care home fees
- Protect inheritance for vulnerable and disabled beneficiaries
- Protect beneficiary’s eligibility to claim means tested state benefits
- Inheritance tax (IHT) planning
- Ensuring your inheritance wishes are carried out
- Protection from sideways disinheritance
- Protection of assets from creditors
Without an APT; vulnerable and disabled beneficiaries could be left unprotected, assets may be sold off to pay for residential care, your family could lose 40% of their Inheritance to IHT, or some beneficiaries may not inherit at all.
What is an Asset Protection Trust?
An Asset Protection Trust can be set up during your lifetime or in your Will to come into effect on your death. ‘Asset Protection Trust’ is a catch all term for any trust designed to protect your beneficiaries who would otherwise be left worse off. This could be because of inheritance tax, long term care fees, or because the beneficiary themselves is not in a situation conducive to receiving an inheritance directly (e.g. they are disabled, they are bankrupt, they are about to get divorced, etc).
Should you be taken into a care home your Local Authority will only contribute if all your savings and assets total less than £23,250. This forces you to pay for care that could cost thousands of pounds every month and as a result many people have to sell their homes to fund the care they require. The Local Authority are obliged to leave you with only £14,250 regardless of the value of your estate and an Asset Protection Trust can offer protection against this happening.
Almost any asset can be placed into an Asset Protection Trust examples include property, savings, insurances, and investments.
We can advise, implement, and administer a number of different forms of Trust including:
- Flexible Life Interest Trust (FLITs)
- Discretionary Trust
- Vulnerable Persons’ Trusts
- Bereaved Minors Trust
- Nil Rate Band Discretionary Trust
- Disabled Person’s Trusts