We have three different trust deeds your clients can use with a general investment account (GIA) on the Aegon Platform - the Bare Gift Trust, the Discretionary Gift Trust and the Discretionary Loan Trust.
Our trusts - features at a glance
A bare trust may be suitable for people who don’t expect their family circumstances to change. This is very important as once the bare trust is set up, you can't change the beneficiaries or their shares.
Adult beneficiaries (over 18 in England, Wales and Northern Ireland or over 16 in Scotland) can demand their share of the trust assets at any time – the trustees have no control over when payments are made.
The value of a gift into a bare trust is classed as a potentially exempt transfer, often referred to as a PET for inheritance tax (IHT) purposes.
The assets in a bare trust are treated as being owned by the beneficiary for IHT purposes. This means that IHT may be due on the beneficiary’s estate (not the client's who created the trust) if the beneficiary dies.
If a bare trust meets your client's needs, you could consider using our Bare Gift Trust(Opens new window) deed.
Discretionary Gift Trust
A discretionary gift trust gives some flexibility over who the beneficiaries will be and when they can benefit from the trust.
A gift into such a trust will be a chargeable lifetime transfer for IHT purposes.
The growth on the underlying trust fund is outside the settlor’s IHT estate from the start.
The settlor can’t benefit from the trust.
If a discretionary gift trust meets your client's needs, you could consider using our Discretionary Gift Trust(Opens new window) deed.
Discretionary Loan Trust
This trust may be suitable for someone who wants to reduce their IHT liability but needs to keep access to their capital.
This trust allows a client to make a loan to trustees who are then able to invest into our Aegon GIA.
The trustees are instructed to repay the loan on demand to the client - who can supplement their income through regular or specified withdrawals from the underlying GIA.
The outstanding loan remains within the settlor’s IHT estate but reduces as the settlor takes loan repayments and spends these.
The growth is outside the settlor's IHT estate from the start.
How to set up a trust and GIA
Step 1: After your client has taken their own legal advice around the suitability of the trust your client needs to set up and complete the relevant trust deed. Copies of the trust deeds are available above.
Step 2: Download the relevant application form and any other documents specific to the trust that suits your client's needs.
- Aegon General Investment Account for trusts application form
- Aegon General Investment Account re-registration application form for trusts
- Trust and identify verification form
Step 3: Make sure your client reads the documents and is aware of the impact setting up the trust has on their investment. They should then complete the necessary documents.
Step 4: Send the application and any other documents including payment to us.
Things to remember
Setting up a trust investment in a GIA - where the trustees invest in a GIA, it will be registered in the name of the trust, with the trustees as authorised signatories.
Trust application forms - when setting up a trust investment, please use the relevant form(s) provided at 'How to set up a trust' above.
Trust verification forms - use the Trust and identity verification form and send us a certified copy of the trust deed or will and probate.
All references to taxation are based on our understanding of current taxation law and practice in the United Kingdom, which may change.
Trusts establish legal rights and entitlements and might have material financial and tax implications for the settlor, trustees and beneficiaries. We aren't authorised to provide legal advice, so your clients should take their own legal advice before setting up a trust, to make sure that it meets their requirements. Our trusts have been drafted for use by UK domiciled individuals only.
The value of any tax relief depends on the individual circumstances of the client.