{"id":259,"date":"2017-03-09T16:27:53","date_gmt":"2017-03-09T16:27:53","guid":{"rendered":"http:\/\/minddigital.net\/step\/?p=259"},"modified":"2026-05-12T11:28:17","modified_gmt":"2026-05-12T11:28:17","slug":"can-use-trust-avoid-inheritance-tax","status":"publish","type":"post","link":"https:\/\/advisingfamilies.org\/uk\/information-portal\/planning-ahead\/can-use-trust-avoid-inheritance-tax\/","title":{"rendered":"Can I really use a trust to avoid inheritance tax?"},"content":{"rendered":"

Last updated: May 2026<\/strong><\/p>\n

Trusts are occasionally seen as devices to avoid paying tax. In reality, you would never set up a trust just to gain tax advantages.<\/p>\n

When you set up a trust you are giving up ownership of the assets it holds. This is a dramatic move, and will normally only make sense if you have clear objectives about what you want to achieve with your assets. Tax should really be a secondary issue.<\/p>\n

In most cases any tax advantages or exemptions given to trusts are tightly targeted at those that are seen as doing social good \u2013 such as charitable trusts, trusts for disabled or vulnerable people<\/a>, etc.<\/p>\n

In many cases the trust may avoid one type of tax, but will be caught by another.<\/p>\n

A lot of people think that if you put your money in a trust it will be exempt from inheritance tax. However, trusts are largely subject to three separate inheritance taxes: an entry charge; an exit charge; and a ten-year charge.<\/p>\n

Let\u2019s look at these in detail.<\/p>\n

Entry charge for a trust<\/h2>\n

The entry charge is paid when you transfer assets into<\/em> a trust. These may include buildings, land or money and can be either:<\/p>\n