Fixed Gift Trust
For Investment Bond
A Fixed Gift Trust can help your client reduce the potential inheritance tax (IHT) due on his or her estate by making an outright gift for the benefit of named beneficiaries. By establishing a Gift Trust on this basis, your client can take advantage of the potentially exempt transfer regime for IHT purposes.
Key benefits
- Mitigate inheritance tax liability by making an outright lifetime gift.
- Joint or single settlements can be made.
- Available with the Investment Bond.
- Further top-up gifts can be made.
- Existing life insurance investment bonds can be assigned into the Gift Trust.
- Not suitable for clients who require flexibility and control.
- Ability to create an absolute (bare) trust.
Key details | |
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Eligibility |
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Features |
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Inheritance tax (IHT) |
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Additional gifts |
Further gifts to the Trust will usually be PETs, but may be immediately exempt from IHT if covered by any of the following exemptions:
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IHT reporting |
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Key documents
Trust deed (PDF, 550KB)
Client brochure (PDF, 63KB)
Important notes on applications (PDF, 66KB)
See all our trust Fixed Gift documents in one place, including forms, guides and brochures.
Other information you need
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The Gift Trust may be suitable for clients:
- who want to take advantage of the favourable potentially exempt transfer (PET) regime
- who want to make an outright, irretrievable gift.
- who are willing to make a decision now on who should benefit from the amount invested.
- who are content that adult beneficiaries could choose to direct the trustees how the funds should be invested and may call for payment of the trust fund at any time
- who wish to avoid delays in distributing the proceeds of their investment.
Not for your client?
Take a look at our other trust options
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- The transfer into the Gift Trust is treated as a potentially exempt transfer for inheritance tax (IHT) purposes and the value of the gift will fall outside your client's estate provided they survive for the next 7 years.
- In addition there is no lifetime IHT payable on the value of the gift, regardless of the amount transferred.
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The Gift Trust is designed for use with the Investment Bond
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- The Gift Trust is not subject to any charges.
- Please see the Investment Bond for charges in relation to the bond.
Important notice
Please note that charges, terms and limits may change. We may change the selection of funds that we make available. There may be restrictions on the amount that can be invested in certain funds. Please contact us for details of any restrictions that apply. Tax treatment depends on the individual circumstances of your client and may be subject to change in the future.
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Before you apply
Before proceeding to the application stage, you should ensure that your client wishes to set up a Fixed Gift Trust (creating fixed trust interests), which is on an absolute basis.
Should they wish to establish the trust on a discretionary basis, please look at our Flexible Gift Trust
Please also ensure your client has read the important notes for applications (PDF, 66KB)
The application stages (new investment)
Step 1
- Complete the Fixed Gift Trust (PDF, 550KB) and the Investment Bond (PDF, 63KB) application forms.
- You will then need to print the forms and ensure they are signed by all the relevant parties.
The following items should accompany the application
- Cheque for investment amount.
- Confirmation of verification of identity of the settlor(s) and all additional trustees.
- Copy of illustration.
Step 2
- Policy documents will be issued to the trustees.
The Gift Trust can also be used for existing polices. Should you require any further information, please speak to your usual sales contact.