Friends Provident International reveals new trusts

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Friends Provident International reveals new trusts

Wed 23rd Aug 2006

Friends Provident International has launched two new trusts designed to help non-UK citizens who are living in the UK to mitigate inheritance tax.

Both trusts are designed to avoid the new, complex tax regime, which was extended to most lifetime settlements by the Finance Act 2006.

The Absolute Discounted Gift Trust is designed for individuals who wish to reduce inheritance tax liability upon their death while continuing to receive an income from their investments.

Meanwhile the Absolute Loan Trust is designed for investors who wish to reduce inheritance tax liability upon their death while still retaining access to the original capital.

Both allow investors to carve out entitlement to a series of capital payments while reducing the value of an estate for inheritance tax purposes.

Brendan Harper, technical services manager at Friends Provident International, said: "The Finance Act 2006 introduced a complex inheritance tax regime that will apply to those who make substantial gifts to lifetime flexible trusts.

"The new FPI Trusts are unaffected by these rules, and are therefore suitable for clients who wish to mitigate inheritance tax on larger lump sums, or who wish to keep their planning as simple as possible."

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