This is a slightly longer Will than some of the other templates, due to the inclusion of a trust.
It is difficult to predict life’s circumstances – therefore, leaving your estate in a discretionary trust is one way to create flexibility. It allows your trustees to pay out income and/or capital to whichever of the beneficiaries are in most need.
The trust gives complete discretion, so the Trustees do not have to pay out anything to any individual. It is usually helpful with this type of Will to draft an accompanying Letter of Wishes, explaining how you would like the trust to be managed.
There may be tax implications of leaving the assets in trust, depending on the size of your estate. However, if the entire estate is paid out within 2 years of your death, the payments are written back into your Will as if you made them yourself, avoiding ongoing Inheritance Tax charges.
- Clause 1 identifies you as the Testator by your name, address and date of birth.
- Clause 2 confirms that the document is your Will, covering your assets worldwide.
- Clause 3 cancels any previous Will or Codicil you have made.
- Clause 4 is for your funeral wishes.
- Clause 5 appoints Executors and Trustees who will collect in your assets, pay your debts and manage the balance.
- Clause 6 establishes the discretionary trust with everything that is left, after debts and expenses have been paid.
- Clause 6.1 sets out who the beneficiaries of the trust will be. The template suggests spouse and children, but you can alter this to benefit whoever you like.
- Clause 6.2 states the trust period to be 125 years (the maximum permitted by law).
- Clause 6.3 gives the trustees power to pay income and/or capital to any beneficiary, with absolute discretion.
- Clause 6.4 permits the trustees to instead add income to the capital, rather than paying it out (but if they don’t add it to the capital, they MUST pay it out).
- Clause 6.5 confirms that the trustees do not need to distribute your assets equally – they have absolute discretion.
- Clause 6.6 requires that your entire estate is distributed within 125 years to avoid adverse tax consequences.
- Clause 7 incorporates STEP’s standard provisions into the Will, giving your trustees a range of powers they will need to administer the estate and manage the trust effectively.
Following Clause 7, you will see the attestation clause where the Testator signs in the presence of two independent witnesses.
I make no representation as to the suitability of this Will for your goals and circumstances.