Discretionary trusts give you the flexibility and control to manage your estate, ensuring your specific wishes and changing circumstances are fulfilled.
At Mattioli Woods, we offer clear, tailored guidance to help you establish and manage a discretionary trust that reflects your wishes and adapts to your family’s changing needs.
With dedicated specialist support and regular reviews, we ensure your trust remains compliant, well managed and flexible enough to deliver the long-term protection and control you’re looking for.
This is a legal arrangement where assets are managed by trustees for the benefit of a group of beneficiaries.
Unlike other trust structures, the trustees have complete discretion over how and when to distribute the trust’s assets, providing unparalleled flexibility in both wealth management and succession planning.
Representing one of the most flexible and tax-efficient vehicles for protecting and transferring wealth across generations, a discretionary trust is a powerful estate planning tool.
A discretionary family trust provides a flexible and protective way to manage and pass on wealth, giving trustees the freedom to support beneficiaries according to their needs while safeguarding assets for the future. This makes it a powerful tool for estate planning, family protection and long-term wealth management.
Discretionary family trusts can be used in a range of circumstances where the settlor would prefer there to be an element of control over access to the trust property.
This could mean controlling access until beneficiaries reach a certain age or protecting the assets if they face bankruptcy or divorce.
Find out more about why you should use a discretionary trust.
These trusts can be tax efficient and often help with Inheritance Tax (IHT) planning, as Neil Farndon, Wealth Management Consultant, explains:
“Discretionary trusts allow you to make gifts to a wide range of beneficiaries, including family members and charities. By placing assets or the proceeds of life insurance policies into a trust, these funds may be kept outside your estate, making sure they are protected and available when needed.
These rules can be complex, and the impact will depend on the value of the transfer and your wider estate-planning goals.
Seeking professional advice is essential. An adviser can help you understand the potential tax implications and determine whether a discretionary trust is the right approach for your circumstances.
Over 30,000 individuals and families have partnered with us for expert financial and discretionary family trust planning. Many stay with us for ongoing guidance as their needs evolve.
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Setting up a trust requires specialist knowledge and our team is here to ensure your arrangements are built around your family's specific needs and long-term objectives.
If you’re thinking about setting up a discretionary trust to protect family wealth, support future generations or safeguard assets for your loved ones, speak to one of our specialist advisers.
The meaning of discretionary trust and discretionary family trust is essentially the same thing. The word ‘family’ is purely added when the beneficiaries are predominantly family members of the settlor.
The only significant difference is that a discretionary family trust restricts the pool of potential beneficiaries to family members and their related entities. However, a standard discretionary trust will allow beneficiaries to be friends, employees or even charities.
Discretionary trusts can be a valuable tool for a wide range of individuals and families. They are particularly suitable for those who want to:
Whether you have significant assets or simply want greater control and protection over how your wealth is used, a discretionary trust can offer a flexible and long-term solution tailored to your family’s circumstances.
Yes. Even if you set up a discretionary family trust, a will is still important. A will allows you to handle any assets that are not included in the trust, appoint guardians for minor children and provide instructions for how your estate should be managed after your death.
A discretionary trust can form part of your wider estate planning, but it does not replace a will.
A discretionary trust is established through a structured legal process, involving several key roles that ensure the trust is managed effectively and according to your intentions:
The trustees have control over the trust and its distributions to the beneficiaries, so you should choose individuals or professional trustees you trust to act in line with your intentions and exercise sound judgement.
Ideally, trustees should be reliable, financially aware and able to handle complex decisions over the long term.
Yes, discretionary trusts are considered separate legal entities and must comply with specific legal and regulatory requirements. They need to be registered with the Trust Registration Service (TRS) in the UK, which ensures transparency and allows HMRC to monitor trusts for tax purposes.
Trustees are also responsible for reporting any income, gains or distributions and ensuring the trust complies with relevant tax laws.
There is no limit on the number of trusts an individual can establish, although there are rules relating to reporting and trust-specific taxes. It’s important that the appropriate advice is sought to ensure initial and ongoing compliance.
A discretionary trust can hold most types of assets that have a value. These could include:
It’s important to note that while most assets can be held in trust, there may be tax implications or specific rules. We always recommend you speak to a financial adviser when looking at a discretionary trust.
Yes, we can provide advice on the trust establishment and ongoing investment management, although we recommend you receive independent specialist legal advice on the trust itself.
Yes. We can take on the management of an existing discretionary trust, provided it is registered with the Trust Registration Service (TRS). If you are already working with us, your consultant can guide you through the process. If you’re a new client, you can book a complimentary consultation to discuss how we can support and oversee the trust professionally.
