Discounted Gift Trust

For those who wish to make a gift but require a regular fixed income stream from the trust.

Transferring assets into a Discounted Gift Trust enables the settlor(s) to reduce the value of their estate for inheritance tax (IHT) purposes, and still have access to the assets by way of regular capital payments. The trust is intended for individuals who have a liability to IHT and are happy to make substantial gifts, but need access to regular payments to maintain their standard of living.

Summary of benefits

  • Immediate reduction in the settlor's estate by way of a discount for IHT purposes.
  • The trust enables the settlor to make a substantial gift and the beneficiaries to enjoy tax efficient growth on the investment.
  • The settlor has the right to receive fixed regular cash payments during his lifetime or until the death of the surviving settlor if joint settlors.
  • The option to have joint settlors (spouses/civil partners) assuming both are UK-domiciled.
  • Discounted Gift Trust – absolute and discretionary versions available