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About the Inheritor Trust Collection

The Inheritor Trust Collection features three extremely flexible copyrighted worded trust precedents, designed and used effectively for over 20 years with gifting of over £200m of client assets into more than 1,500 personal Trusts, the savings in IHT because of these gifts have been extraordinary.

The three strategies are:

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1. WAY Inheritor Gift Trust

The principal trust in use for the majority of our settlors is the WAY Inheritor Gift Trust. This Trust permits assets to be gifted into a flexible trust allowing (but does not oblige) the trustees to revert a portion (specified by the settlor at the outset) of the trust value on anniversaries of the initial gift. Any full or partial reversions not returned to the settlor can then be deferred by the trustees for distribution at one or more future anniversaries.

Of course, potential reversions are normally deferred but should the settlor have any unanticipated need for financial support, be it some kind of personal crisis or a health or long-term care need then the trustees will seek to support those needs as appropriate. At the same time funds can be made available to your family – at the discretion of the trustees following prior reference to you and/or your Letter of Wishes.

2. WAY Inheritor Loan Trust

In situations where you do not wish to restrict your own access to such funds or where you have no available NRB to absorb a gift, WAY offers the WAY Inheritor Loan Trust, which puts loaned assets into an independently managed trust on a repayable on demand basis (thereby covering the ability to recall money as necessary). In this situation any growth immediately occurs outside of the lender’s estate and, where large loans are made over long periods, this can represent sizeable savings.

Of course, the flexible trust also allows the trustees, in conjunction with the settlor and in the light of any returning availability of the NRB (or the lender waiving partial or full repayment) to gift assets on to an Inheritor Gift Trust and/or to support members of the family in need.

3. WAY Inheritor Gifts from Income Trust

Some clients are in the fortunate position of enjoying a sometimes, restricted period of surplus earnings (including successful entrepreneurs, City traders, sports people, entertainers and so forth) where they have surplus after-tax earnings for several years, or more modest surpluses for longer periods. Gifting such regular surplus income into the WAY Inheritor Gifts from Income Trust immediately puts those assets into a fully IHT exempt environment.

The same flexible trust precedent lies at the heart of this arrangement so that assets can be returned to the settlor or appointed out to beneficiaries as needed over future years – again at the discretion of the trustees having referred to you and/or your Letter of Wishes.

Trusts can offer many more benefits to you and your family both during your lifetime and beyond including:

• Allowing trustees to make urgently needed funds immediately available to family, including after your demise, without the need to wait for probate (which can take several months and in more extreme cases years).

• Permanently protecting family assets so that they are not inadvertently dispersed following a marriage breakdown for example.

• Differentiating between beneficiaries in post death support for your spouse (or civil partner) and children (whether natural, adopted or step) in line with your ongoing wishes.

• Offering financial security and support to you in the event of failing health and/or the need for care later in life.

• Mitigating Inheritance Tax on an inter-generational basis.

WAY Trustees become impartial guardians of your funds as independent professional trustees and we will use your guidance (both initially and as circumstances change) on how you would like assets to be used for you and your family on an ongoing basis.

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