Recent media coverage has highlighted the difficulties being faced by former clients of McClure Solicitors, which went into administration in spring 2021. McClure made arrangements for the assets of many of their clients to be transferred into ‘Asset Protection Trusts’, leaving some of their clients concerned about the management of the trusts going forward. If you are one of these people, we hope to set your mind at ease by explaining how our legal services can help you.
Can Asset Protection Trusts be beneficial?
When set up correctly, a trust can prove to be an effective way of planning your estate. They can be advantageous in a number of different circumstances, for example:
- A trust can be a useful way to plan for and minimise potential Inheritance Tax liabilities. When assets are held in trust, they do not usually form part of an individual’s estate and therefore may not form part of an Inheritance Tax assessment, depending on the individual circumstances.
- It can also protect assets of young or vulnerable beneficiaries as the assets are looked after and managed by the trustees for the beneficiary.
- Trusts can also be set up with a view to protecting assets for future generations.
What are Asset Protection Trusts?
A trust is a legal arrangement where an individual transfers assets (for example property, cash or an investment) to trustees who are appointed to manage the assets for the benefit of beneficiaries nominated by the person who set up the trust. The person creating the trust sets out in the trust deed the terms on which the assets will be managed. Once the trust has been set up and the assets transferred to it, the assets are owned by the trustees and no longer form part of the individual’s estate.
Professional trustees are often appointed as trustee, but family members can be appointed as trustees too.
How can we help?
If you have concerns about an existing trust or estate planning measures, we would be happy to review your existing arrangements and advise on the best way forward. This might involve updating the trust to assume new trustees and requesting the existing professional trustees resign. We can also advise on the tax implications of the trust and any regulatory requirements, such as the requirement to register the trust with HM Revenue and Customs.
We are already actively assisting several of previous McClure Solicitors’ clients. Our experienced team of trust solicitors is accredited by the Society of Trust & Estate Practitioners and our head of personal law, Lindsay Maclean, is regional director for Solicitors for the Elderly. We can also assist you with setting up the most appropriate trust for your set of circumstances and can assist with ongoing trust management and administration. You can find more information on the practicalities of administering trusts and the different types of trusts in our previous blog post: A Simple Guide to Trusts and Trust Administration.
The content of this page is for information only. It is not intended to be construed as legal advice and should not be treated as a substitute for specific advice. Gibson Kerr Ltd accepts no responsibility for the content of any third party website to which this webpage refers. Gibson Kerr Ltd is regulated by the Law Society of Scotland.