Family Trusts UK
A Guide to Protecting Family Wealth Across Generations
Managing family wealth isn't only about today — it's about making sure the next generation is supported, protected and set up to thrive. A family trust is one of the most effective tools in UK estate planning for achieving exactly that, and the peace of mind that comes with it.
What is a Family Trust?
A trust is a legal arrangement in which you (the settlor) transfer ownership of assets to people you trust (the trustees), who manage them for the benefit of your family (the beneficiaries).
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Once assets are placed into the trust, they're no longer owned by you personally. Instead, a trust deed governs them — a bespoke set of instructions that ensures your wealth is handled exactly as you intended, long into the future.
Why Choose a Trust Alongside Your Will?
A will is essential, but a family trust adds a layer of long-term protection a will alone can't provide:
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Asset Protection — keeping property, investments and savings within a secure legal structure for future generations.
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Controlled Inheritance — deciding how and when wealth is released, for example, when a grandchild turns 25 or specifically towards university fees.
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Financial Stewardship — preventing wealth from being spent too quickly or unwisely, so it provides lasting stability.
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Support for Vulnerable Family Members — providing a dependable financial framework for relatives who may be unable to manage their own affairs.
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A trust complements your will rather than replacing it — the two work best together.
Common Family Trust Structures
Choosing the right structure is central to a trust's doing its job. The three most common are:
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Discretionary trust — the most flexible. Trustees decide which beneficiaries receive funds and when, allowing the trust to adapt as family circumstances change.
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Bare trust — a simpler arrangement in which the beneficiary has an immediate right to the assets and is often used for children.
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Interest in possession trust — well-suited to more complex families. One beneficiary receives the income (such as rent) during their lifetime, while the capital (the asset itself) is preserved for someone else later.
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What can you put into a family trust?
A trust can hold a wide variety of assets, including residential or commercial property, cash savings and investment portfolios, private business shares, life insurance policies, and valuable personal belongings such as art or antiques.
A Cautionary Tale: The Murdoch Family Trust Dispute
Trust disputes usually play out privately, which is what makes the recent battle over Rupert Murdoch's media empire such an instructive — and rare — public example of why the quality of a trust's design matters so much. (It's worth noting this is a United States case decided under US law, but the underlying lessons apply universally.)
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In 1999, Rupert Murdoch established an irrevocable family trust holding the family's media interests, with control intended to be shared equally among his four eldest children upon his death. Decades later, he sought to amend those terms to grant sole control to one son, Lachlan. The other children challenged the change — and in December 2024 a Nevada probate commissioner rejected the attempt, with the parties found to have acted in bad faith. The matter remained subject to appeal thereafter.
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The case highlights four qualities that make any family trust resilient:
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Certainty From the Outset – Much of a trust's strength lies in its binding nature – which is precisely why you need to be clear about your long-term intentions from day one rather than expecting to change course later.
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Clear Documentation – Disputes thrive on ambiguity. A detailed letter of wishes provides evidence of your intentions and can help resolve family tension before it ever reaches a courtroom.
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Open Communication – Beneficiaries who feel blindsided are far more likely to litigate. Transparency with your family can defuse the emotional escalation that drives disputes.
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Impartial Trustees – Family members acting as trustees can be accused of bias. A professional trustee owes a duty of undivided loyalty to the trust, and can bring valuable neutrality to difficult decisions.
The Risks of Getting It Wrong
Without these foundations, a trust becomes vulnerable to challenge — including claims that the settlor lacked the capacity to understand what they signed, allegations of undue influence by a family member, or simple drafting errors that lead to unexpected tax charges or, in the worst cases, render the trust void. It's a reminder that a trust is only as strong as the care taken in setting it up.
As an estate planning and inheritance tax specialist for accountants, my journey began by helping business owners simplify complexity and plan for long-term success. Today, I work with accountancy professionals advising high-net-worth individuals, property investors, and business owners on how to preserve wealth, minimise inheritance tax, and structure multi-generational legacies.
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Over the years, I've worked alongside professionals across multiple sectors, authored features for Tax Adviser magazine, and co-authored Inheritance Tax Simplified, a practical guide to navigating the legal and financial complexities of estate planning. These experiences are shaped by the belief that accountants play a pivotal role in their clients' financial future, but they often lack direct access to the technical estate planning tools required to protect that future fully.
Meet Our Managing Director:
Ray L. Best
Ray Best is Managing Director of Wills, Tax & Trusts Ltd, with over two decades of experience in UK estate planning and asset protection. Specialising in discretionary and interest-in-possession trusts, he has helped many families navigate both the financial and the personal dimensions of protecting wealth for future generations.
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Known for a careful, considered and compassionate approach, Ray is co-author of Inheritance Tax Simplified and a frequent contributor to industry discussion on inheritance and long-term wealth stewardship. His latest book, Pension Paradigm, encourages families to seek advice early on the coming merger of pensions with inheritance tax.
Meet Our Managing Director:
Ray L. Best
Ray Best is Managing Director of Wills, Tax & Trusts Ltd, with over two decades of experience in UK estate planning and asset protection. Specialising in discretionary and interest-in-possession trusts, he has helped many families navigate both the financial and the personal dimensions of protecting wealth for future generations.
​
Known for a careful, considered and compassionate approach, Ray is co-author of Inheritance Tax Simplified and a frequent contributor to industry discussion on inheritance and long-term wealth stewardship. His latest book, Pension Paradigm, encourages families to seek advice early on the coming merger of pensions with inheritance tax.
Ready to Protect Your Family's Future?
Every family is different, and the right trust depends entirely on your circumstances and goals. We'd be glad to help you explore what's appropriate for you.