When writing your Will, you may include a Trust for certain portions of your estate, such as cash gifts or property. Alternatively, you may be acting as an Executor or Trustee for a Will that includes a Trust.
One type of Trust is a Nil Rate Band Discretionary Trust (NRBDT). This blog will answer frequently asked questions about this type of Trust, Nil Rate Bands, and Discretionary Trusts in general.
What is a Nil Rate Band Discretionary Trust?
A Discretionary Trust is one where the Trustees named in the Will have power over how the allocated inheritance is spent. The details of their involvement will be laid out in the Trust document; in the case of a Will Trust, the Will becomes this document. Many people don’t understand that the Will is the Trust document and go looking for other documentation.
Depending on the wishes expressed in the Will, Trustees may be able to decide:
What gets paid out (e.g. whether the total amount will be paid in full or in instalments)Which beneficiary receives the inheritance – if, for example, ten beneficiaries are named in the Trust, the Trustee(s) may only choose to pay some of these, or they may pay all of them equally. It’s completely at their discretionHow frequently payments are madeWhether there are any conditions as to how the money will be spent
