Revert to Settlor Trust

The Revert to Settlor Trust is available for use with existing Regular Savings Plans. It ensures that any benefits payable in the event of the settlor's death are held outside the settlor's estate for his or her chosen beneficiaries, while the maturity benefit (and any critical illness benefit payable under the plan) is held for the settlor.

Key benefits

  • For use with existing Regular Savings Plans only.
  • Discretionary trust for wide class of beneficiaries.
  • Regular premium payments usually exempt gifts if made out of surplus income.
  • Death benefits held outside settlor's estate for inheritance tax purposes.
  • Maturity benefits and critical illness benefits (if any) held for the settlor with no gift with reservation issues.
  • No scope for settlor to access funds prior to policy maturity date.
  • Joint or single settlements.

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Key details

Eligibility
  • The settlor must be 18 years or over and of full mental capacity.
  • We will not normally accept trusts created under a power of attorney.
  • Joint or single settlements available.
  • Only for use in conjunction with existing Regular Savings Plans.
Features
  • Death benefits payable to remaining trustees for onward distribution to trust beneficiaries without the need for probate.
  • Death benefits outside settlor's estate for inheritance tax purposes.
  • Provides settlor with unfettered access to maturity benefits, if living at the plan maturity date, and to critical illness benefits in the event of a critical illness.
Inheritance tax (IHT)
  • Regular premium payments usually exempt gifts, for example, if made out of surplus income but will otherwise be chargeable.
  • Death benefits held outside settlor's estate for inheritance tax purposes.
  • Maturity benefits and critical illness benefits (if any) held for the settlor with no gift with reservation issues.
IHT reporting
  • IHT100 reporting requirements and inheritance tax charges may apply every 10 years (periodic charges) or when trust capital is paid to beneficiaries (exit charges).

Key documents

Revert to Settlor trust form (PDF)

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Other information you need

  • The Revert to Settlor Trust is suitable for clients with existing Regular Savings Plans who:

    • would like to receive any benefit payable either on maturity of the policy or in the event of a critical illness; but
    • wish to ensure that any death benefit payable under the policy passes to their chosen beneficiaries free of inheritance tax.

    Not for your client?

    Take a look at our other trust options

  • The Revert to Settlor trust is available for use with existing Regular Savings Plans.

  • Before you proceed

    Before proceeding further you should ensure that your client wishes to set up a Revert to Settlor Trust. 

    The process

    Step 1

    Complete the Revert to Settlor Trust form (PDF)

    You will then need to print the form and ensure it is signed by all the relevant parties.

    Step 2

    A copy of the trust form should be sent to us at the address below, so that records can be updated to show that the plan is now under trust.

    Scottish Widows
    PO Box 28117
    15 Dalkeith Road
    Edinburgh
    EH16 9AN

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