Get in touch with me, Trevor Smith, today. Whether you have questions about setting up a trust, arranging a Power of Attorney or simply want clear, friendly advice on protecting your assets, I’m here to help. Reach out by phone, email or by using the contact form on this page—I’ll get back to you as soon as possible.
trevor@assetprotectionoffice.co.uk
0800 824 7004
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What does it mean?
How you own your property is so important. 99% of people own their home jointly and severally, so a married couple would own the property 100%.
Changing joint ownership to tenants in common is a legal process that alters the way two or more people co-own a property. Under joint ownership (also known as joint tenancy), all owners hold the property equally, and if one dies, their share automatically passes to the surviving owner(s) — this is known as the right of survivorship.
In contrast, tenants in common each own a distinct share of the property, which can be equal or unequal. Importantly, when one co-owner dies, their share does not automatically pass to the others. Instead, it forms part of their estate and is distributed according to their will or under intestacy laws.
In the context of the financial assessment for Care Home Fees what value is half a house?
Changing ownership structure can have significant legal and financial implications. Common reasons for switching to tenants in common include:
Estate planning: Ensures your share of the property goes to a specific person or beneficiary (e.g. children from a previous marriage).
Asset protection: Can help protect your share of the property from being automatically transferred to others on death.
Care home fee planning: A person's share may be considered separately when assessing assets for care fees.
Unequal contributions: Reflects unequal financial input from co-owners — for example, if one person paid a larger deposit.
Separation or divorce: Useful in formalising individual ownership in the event of a relationship breakdown.
To convert a property from joint ownership to tenants in common in England and Wales, follow these steps:
Complete a ‘Form A restriction’: This is submitted to HM Land Registry to register a restriction on the title that indicates the property is held as tenants in common.
Sign a deed of severance: A legal document that formally severs the joint tenancy.
Notify the other owner(s): All co-owners must be informed of the severance.
Update your will: Once you own a specific share of the property, it’s essential to have a valid will to control what happens to your share after death.
Changing from joint ownership to tenants in common is a relatively straightforward process, but it requires legal and/or financial knowledge. Here at the Asset Protection Office, we have the knowledge and experience to deal with this for you.
What is an NRB Discretionary Trust?
An NRB discretionary trust is a type of trust used in estate planning to make use of an individual's Nil-Rate Band (NRB) — the threshold up to which no inheritance tax (IHT) is payable. In the 2024/25 tax year, the NRB is £325,000 per person.
This kind of trust is typically set up in a will and activated on death, allowing the deceased’s NRB allowance to be used in a flexible and tax-efficient way — without immediately passing assets outright to beneficiaries.
Discretionary nature: The trustees have full discretion over who receives what, when, and how much — among a defined class of potential beneficiaries (e.g. spouse, children, grandchildren).
Uses the NRB allowance: The trust is usually funded with assets up to the NRB to avoid triggering inheritance tax at the point of death.
Asset protection: Trust assets do not automatically become part of a beneficiary’s estate, which can help protect them from divorce, bankruptcy, or means-testing.
Delayed distribution: Beneficiaries don’t have automatic entitlement, which gives trustees time to assess family circumstances and tax implications.
There are several strategic reasons to include this type of trust in your estate planning:
Maximise inheritance tax efficiency: It uses the NRB effectively, particularly in estates where spouses have substantial assets of their own and don’t need the inheritance immediately.
Protect vulnerable beneficiaries: Assets can be managed for young, disabled, or financially vulnerable family members without giving them direct control.
Preserve family wealth: Keeps family assets within bloodlines and can avoid potential claims from in-laws, creditors, or local authorities (e.g. for care home costs).
Adapt to changing circumstances: Trustees can delay decisions until the tax and family position is clearer after death.
Include it in your will: The most common way to set up an NRB discretionary trust is to include appropriate provisions in your will. This will specify:
The amount (usually up to the NRB).
The trustees.
The class of potential beneficiaries.
Choose trustees wisely: Trustees will manage and distribute the trust assets at their discretion, so it’s vital to appoint people who are competent and trustworthy.
Letter of wishes: While not legally binding, a letter of wishes can guide trustees on how you'd prefer them to distribute the assets.
Review periodically: Wills and trusts should be reviewed regularly, especially if tax laws or family circumstances change.
Setting up an NRB discretionary trust involves legal drafting and careful consideration of tax implications. Here at the Asset Protection Office, we have the knowledge and experience to deal with this for you..
What is it?
An Interest in Possession Trust (IIP) is a type of trust where a named beneficiary (the “life tenant”) has an immediate and automatic right to the income generated by the trust assets, or the right to use or occupy property held in the trust, for life or a specified period. The capital (or remainder) is preserved for other beneficiaries — often called the reversionary or remainder beneficiaries — who will receive it when the interest in possession ends (typically on the life tenant’s death).
Setting up an IIP can serve various personal, financial, and estate planning objectives:
Provide for a spouse or partner during their lifetime while ensuring the underlying assets ultimately pass to children or other beneficiaries.
Protect family wealth — ensuring capital is preserved while still offering income or use of assets.
Control asset distribution — allowing you to decide how and when different beneficiaries benefit.
Potential inheritance tax (IHT) planning — under certain conditions, IIP trusts benefit from favourable IHT treatment (e.g. if set up before 22 March 2006 or if qualifying under the spouse exemption).
The life tenant has a right to income (e.g. rental income, dividends) or to occupy a property.
The trustees manage the assets and are legally responsible for distributing the income as per the trust deed.
The capital beneficiaries have no right to income but are entitled to the trust capital when the interest in possession ends.
An IIP can be created during lifetime (inter vivos) or by will (on death).
Define your goals: Identify what you want the trust to achieve (e.g. income for a spouse, eventual inheritance for children).
Draft the trust deed: Work with Asset Protection office to define:
The life tenant
The capital beneficiaries
The trust assets
The trustees’ powers and duties
Appoint trustees: Choose individuals or professionals you trust to manage the assets responsibly and impartially.
Transfer assets into the trust: This could include property, shares, cash, or other income-generating assets.
Register the trust: Most trusts now need to be registered with HMRC’s Trust Registration Service (TRS).
Keep accurate records: Trustees must maintain detailed accounts and comply with annual tax and reporting duties.
Income Tax: Income received by the trust is taxed either on the trustees or the beneficiary, depending on how it is distributed.
Capital Gains Tax: Trusts have their own CGT allowance, and disposals of assets may trigger gains.
Inheritance Tax:
If the IIP is created in a will for a spouse, it may qualify for the spouse exemption.
If it’s created during lifetime, it may fall under the relevant property regime, unless qualifying exceptions apply.
Providing a home for a surviving spouse with capital preserved for children.
Allowing one person to live in a property for life, while ensuring it eventually passes to someone else.
Managing family wealth across generations with clear control and protection.
Setting up an Interest in Possession Trust can be a powerful tool for long-term planning, but it involves complex legal and tax considerations. Here at the Asset Protection Office, we have the knowledge and experience to deal with this for you..
With over 30 years of experience in the financial services industry, I have built a career helping individuals and families make informed, confident decisions about their financial future. My expertise spans across consumer finance, commercial finance, residential mortgages, Buy-to-Let portfolios, and later life lending, including Equity Release and Lifetime Mortgages.
Over the years, I’ve advised hundreds of clients — from first-time buyers to seasoned investors — on how to build, grow, and protect their assets. My approach is personal, strategic, and always focused on long-term security and peace of mind.
As demand for robust estate planning has grown, I’ve expanded my services to include Wills, Trusts, and Lasting Powers of Attorney, with a special focus on helping clients protect their family home from threats like care fees, creditors, divorce, and bankruptcy.
Today, I combine financial knowledge with estate protection strategies to help people bulletproof their legacy — using smart tools like Tenants in Common, Discretionary Trusts, and Interest in Possession Trusts.
If you’re looking for trusted, experienced advice on how to structure your finances and estate for maximum protection, I’m here to help.
