Will trusts made clear: Which trust is right for you?

When writing a Will, it’s not just who you leave assets to that matters it’s how you leave them. A will trust can be a powerful planning tool, offering control, flexibility and protection for your beneficiaries, alongside potential tax advantages.

A will trust is created on death through your Will. Instead of assets passing outright to beneficiaries, they are placed into a trust and looked after by trustees, who manage them in line with your wishes and trust law. The right trust structure will depend on your family circumstances, your objectives, and the level of protection or control you want to put in place.

Examples of Wills Trusts include:

• Bare Trusts
• Interest in possession (life interest) trusts
• Discretionary trusts
• Disabled person’s trust

The most common types of trusts used in these circumstances are life interest trusts and discretionary trusts.

Interest in possession (life interest) trusts – balancing different needs

A life interest trust gives a named beneficiary (the life tenant) the right to trust income or to occupy trust property for their lifetime or a fixed period. When that interest ends, the underlying capital passes to other beneficiaries (the remaindermen).

These trusts are commonly used where the deceased has been married previously, or they would like to protect their estate from future remarriage. They can provide financial security or a home for a surviving spouse, while ensuring that capital ultimately passes to children from a previous relationship.

In certain cases, life interest trusts for spouses or civil partners can qualify for the inheritance tax spouse exemption, meaning no inheritance tax is payable on the first death.

Discretionary trusts – maximum control and protection

Under a discretionary trust, trustees have full discretion over who benefits, when, and how much they receive. No beneficiary has an automatic entitlement.

This flexibility makes discretionary trusts particularly useful where there are concerns about beneficiaries being too young, vulnerable, financially inexperienced, or exposed to external risks such as divorce or creditors. They can also adapt to changing family circumstances over time.

From a tax perspective, discretionary trusts sit within the relevant property regime, meaning there may be periodic inheritance tax charges. However, for many families, the added protection and control justify this.

Choosing the right trust

There is no one‑size‑fits‑all solution. The most suitable will trust depends on your priorities, whether that is simplicity, flexibility, asset protection, tax efficiency, or balancing the needs of different family members.

Professional advice is essential to ensure your Will and any trusts within it are tailored to your circumstances and achieve the outcomes you intend.

If you are the trustee of a will trust which has now come into existence on death, and you require any assistance please contact a member of our trust team.