Desmond O'Donnell, senior associate from our family department and Stuart Price, solicitor from our private client department, speak with Spear's about pre-nuptial agreements for wealthy families.
Desmond and Stuart said, "Pre-nups are still prevalent in the HNW world as a useful tool to protect assets in the event of the breakdown of a marriage, but families who are increasingly concerned about the fallibility of the institution are looking for a more foolproof alternative".
"New research by Investec has found that a third of parents are unwilling to provide financial help or leave an inheritance to their married (or soon to be married) child, and that around 13 per cent of survey participants have now considered setting up discretionary trusts instead".
"Subject to previous gifting, each parent may gift up to £325,000 into a discretionary trust without an immediate Inheritance Tax (IHT) charge. If each parent survives for seven years from the date of the gift, the assets will be outside of the combined estate for IHT purposes. The parents will normally appoint themselves as the trustees and they will have complete control of the trust assets. They will also decide who the discretionary beneficiaries of the trust will be. They might choose their children and grandchildren at the outset, with trust provisions allowing further discretionary beneficiaries to be added later".
The full article is available to read online, first published by Spear's on 16 February 2017: Are trusts the new pre-nups for wealthy families?