Discretionary Will Trust
Impartial advice about Discretionary Will Trusts
Its EASY to make a Discretionary Will Online - for further
information click here
A Discretionary Will Trust is a way by which married couples and civil
partners can minimise or even eliminate their inheritance tax liability simply by making and implementing a
pair of correctly worded Wills - know as Will Trusts and sometimes referred to as Nil-Rate Band Discretionary
Wills. Discretionary Will Trusts work by making use of the Nil rate Tax Band of BOTH spouses, rather than just
that of the surviving spouse as is the case with a "normal" will.
By using the simple method of a discretionary trust will you can save up to
£120,000 in Inheritance Tax.
Any couple whose total joint estate exceeds £600,000 should make a discretionary
trust with their will. With the huge rise in house prices in the UK many will have estates in excess of
£600,000 when you add up the value of houses, investment, life insurance and personal
You do NOT need to incur the costs of using a Solicitor - you can make a
discretionary will trust ONLINE in minutes. For further information, visit our Online Discretionary Will
Trust page here
Why Make a Discretionary Will Trust?
The main reason is that it is a simple method of reducing Inheritance
The first slice of any individual's estate, including gifts which they have made
in the last seven years, is generally free of inheritance tax. This slice, referred to as the 'nil rate
band', was increased to £300,000 from 6 April 2007. Inheritance tax is charged at 40% on the amount which
exceeds the nil rate band.
A majority of couples choose to leave all of their estates to the surviving spouse
on the first death, i.e. they make a will stating "I leave all of my estate to my wife/husband" provided that
she survives me...".
Transfers between spouses or civil partners including transfers on death are
exempt from inheritance tax (subject to a limit of £55,000 if the surviving spouse or civil partner is not
domiciled in the UK). Thus, there is no tax to pay when the first spouse or civil partner dies if all of that
spouse's assets are left to the survivor.
However, the combined estate is then taxed in full on the death of the 2nd spouse.
Where all of the estate is left to the surviving spouse or civil partner, the
deceased's nil rate band is not used, except to the extent that the individual made certain gifts during his
or her lifetime.
This means that by simply making a "Discretionary Will" you can save 40% of
£300,000 or £120,000.
It is therefore far more tax effective to use up the nil rate band of both spouses
or civil partners by creating a discretionary will.
Many people believe that making a discretionary will is complicated or expensive.
This is not the case!
Who should make a Discretionary Will?
Anyone married couple or civil partnership whose combined estates exceed
What is the best way to make discretionary will trusts?
You can make a Discretionary Will Online quickly and without the expense of a
solicitor. For further information about making a Discretionary Will Online visit our online page