Lifetime Trusts

Lifetime Trusts for Bloodline Planning and Asset Protection

Asset Protection Trusts are used to ‘ring fence’ assets providing peace of mind that they are protected to provide for chosen beneficiaries. Asset Protection Trusts are a lifetime settlement used to provide for a surviving spouse and future generations by protecting the assets from third party creditors. The trust works by transferring the legal ownership of the trust asset to the Trustees for them to hold for the eventual enjoyment of the chosen beneficiaries. Placing assets into an APT protects them from sideways disinheritance and potential claims upon the divorce or bankruptcy of a beneficiary. Furthermore, probate fees can be mitigated or avoided altogether as the assets within the trust are not treated as part of the estate for probate purposes. An APT also affords protection against any potential claim under the Inheritance Family Provisions legislation following the death of the settlor. The settlor can transfer assets into an APT whilst continuing to enjoy the use and benefit of the asset for the rest of their life. In the case of the family home, the settlor and their spouse can still retain a right to reside in the trust property. The equity of a property which is subject to a mortgage can be placed within a trust and secured by a restriction against Land Registry title. In certain circumstances, an APT provides flexibility for the Trustees, at their discretion, to maintain one or more beneficiaries with income or capital depending on their individual needs.