At Turcan Connell,we aim to provide you with expert advice on the most tax-efficient methods of preserving wealth in the interests of your family's future.
Family Trust Funds (Family Partnership)
Trusts are used as a means to transfer wealth down the generations but in a way which controls how and when the intended beneficiaries receive income and capital. They also protect the Trust Fund from claims by creditors or in the event of divorce.
The changes introduced to the inheritance tax legislation in the 2006 Finance Act make it extremely difficult to transfer assets worth more than the prevailing nil-rate allowance into a trust, unless such assets qualify for either business property relief or agricultural property relief at 100%.
Choosing a Family Partnership could eliminate some of the tax-related charges.
Would a Family Partnership work for you?
Family Partnerships can be structured in such a way as to secure controls - similar to those achieved by a trust - over what a partner (the beneficiary) receives byway of income and capital, but also as a measure of protection for the Partnership assets.
The benefit of a Family Partnership structure is that assets can be transferred to the intended beneficiary as a potentially exempt transfer, so no inheritance tax is payable, regardless of the amount involved, so long as the transferor survives the transfer by seven years, but the gifted asset is not owned outright by the recipient.