Wills and probate question posed

A person has asked a wills and probate question regarding letting another having access to their inheritance, which has been answered by a financial expert.

This reader wrote to the Financial Times (FT) saying that they were set to inherit approximately £200,000 and wanted to let a third party, a friend, have access to the income from this money, but not the capital.

The reader said that they wanted the third party to have access to the cash while the friend was alive and wished for it to go back to themselves or their own successors after the third party had died.

In response to this wills and probate question, Tim Gregory, a partner in a private wealth group at a chartered accountants, said that a settler-interested trust will allow an asset to return to the settler of the trust after the death of the beneficiary.

However, any income tax arising from this will be the responsibility of the settler.

In addition, Mr Gregory pointed out that inheritance tax might have to be paid when the trust is created, on each of its tenth anniversaries and when it is closed.

Despite this, people can avoid paying inheritance tax on a portion of their assets by bequeathing them to a charity when they make a will.

Published by Hannah Carr