Quilter 5 What is a trust? A trust allows an individual (‘the Settlor’), to transfer money out of their estate (‘the gift’) and entrust it to ‘the trustees’ they have chosen. This gift becomes the ‘trust fund’. The responsibility of the trustees is to manage the trust fund for the benefit of ‘the beneficiaries’. There are two main types of trust – discretionary trusts and bare trusts. A discretionary trust, such as the Lifestyle Trust, has flexibility as to who can potentially benefit. Generally there is a class of beneficiaries specified, typically groups of people such as grandchildren or other family members. No beneficiary is entitled to any benefits until the trustees exercise their discretion to provide benefits for a particular beneficiary. The potential beneficiaries therefore have no control over if or when they might receive anything from the trust fund. A bare trust has named beneficiaries who cannot be changed and who become absolutely entitled to the trust property at age 18. The trustees on a bare trust have no discretion over if or when the beneficiaries will receive their benefits. For more information about trusts, please visit: https://platform.quilter.com/platform- and-products/trust-planning/ The Lifestyle Trust The Lifestyle Trust is a discretionary trust. It is a tax-efficient * solution for leaving wealth to future generations. Any growth on the gift into the trust is immediately outside the Settlor’s estate for inheritance tax purposes and, if they survive for seven years after the gift is made, its original value will not be liable to inheritance tax. * The value of any tax relief will depend on the client’s individual circumstances and may change. Who is the Lifestyle Trust suitable for? A client who: requires access to their gift into the trust requires flexibility over how they access it requires control over who benefits from their wealth and when is concerned about the IHT position of their estate and wants to take action.