One of the most common questions we get at Castle Family Legal is: 'Do I need a Will, a Trust, or both?' The confusion is understandable — the estate planning world uses both words loosely, and DIY websites often blur the line. In reality, Wills and Trusts do very different jobs, and most well-planned estates use both.
What a Will does. A Will is a legal document that takes effect on death. It appoints executors, names guardians for minor children, and directs who inherits what. Without a valid Will the intestacy rules of England and Wales apply — which almost never match what people actually want, especially for unmarried couples, blended families and cohabitees.
What a Trust does. A Trust is a legal arrangement where trustees hold assets on behalf of beneficiaries. Trusts can be created during lifetime (a 'lifetime trust' or 'inter vivos trust') or on death through a Will (a 'Will trust'). Because the assets are legally held by the trustees rather than the beneficiary, they can be protected from claims, controlled over time, or held for someone who cannot manage them themselves.
Key difference. A Will only affects what happens on death. A Trust can affect what happens during lifetime, on death, or both. That is why they are complements, not alternatives.
When a Will on its own is enough. A single person or couple with no property, modest savings, no children from previous relationships, no business, and an estate comfortably below the £325,000 IHT threshold usually needs a well-drafted Will and nothing more. Adding a trust here rarely earns its keep.
When a Property Trust Will earns its keep. A married couple or civil partners who jointly own their home benefit substantially from Property Trust Wills. On the first death, the deceased's half share of the home is held on trust — with the survivor able to live in it for life — instead of passing outright. This ring-fences that half share from a future new spouse, from care home fee assessments (subject to the deprivation of assets rules), and from sideways disinheritance if the survivor remarries.
When a Discretionary Trust earns its keep. Discretionary Trusts (either lifetime or through a Will) are the standard tool where a beneficiary is vulnerable, on means-tested benefits, going through a divorce, financially reckless, or a minor. The trustees decide when and how much to pay out, which protects the beneficiary from themselves and from creditors.
When a Bare Trust or Bereaved Minor's Trust earns its keep. Where children under 18 are beneficiaries, a Bare Trust or a Trust under sections 71A/71D of the Inheritance Tax Act 1984 gives structured control until the child reaches an appropriate age (often 18 or 25) — instead of a lump sum landing at 18.
When a lifetime Family Trust or FIC earns its keep. Wealthier families with investment portfolios or business interests sometimes use lifetime trusts or Family Investment Companies (FICs) for succession planning and IHT mitigation. These are complex structures — used well they are extremely effective, used badly they cost more than they save.
The IHT myth. A common misconception is that 'putting your house in a trust' automatically avoids IHT. It usually does not. If you retain the right to live in a property you have transferred, HMRC treats it as a gift with reservation of benefit — the property is still fully in your estate for IHT purposes. Legitimate IHT mitigation using trusts requires proper structuring and, in some cases, giving up genuine control.
Worked example 1 — married couple, £600,000 estate, home worth £400,000. Mirror Property Trust Wills leaving the deceased's half share on life-interest trust to the survivor. On second death everything passes to the children. Uses both nil-rate bands and the residence nil-rate band — likely £0 IHT. Ring-fences £200,000 from remarriage and care fee assessments.
Worked example 2 — single parent, £250,000 estate, one child aged 8. Simple Will with a Bereaved Minor's Trust to age 21. Guardian appointed. Executors and trustees appointed. No lifetime trust needed.
Worked example 3 — business owner, £1.5m estate including a company qualifying for Business Relief. Will with a Business Property Relief planning clause and a Discretionary Trust receiving the business assets on death to lock in the relief. Consider lifetime succession planning separately.
How Castle Family Legal helps. We start every client with a free discovery conversation and only recommend a Trust where it demonstrably earns its keep. Every Will we draft is prepared by a qualified adviser on a fixed fee agreed up front. Contact Greg Stevens for a no-obligation discussion.