Setting Up a Trust for Your Children in Your Will

Emma and James had £480,000 in assets between their home, life insurance, and savings. When Emma died unexpectedly at 37, their two children were 6 and 9. Under Emma's will, her share went directly to the children when they turned 18.

At that age, their daughter Olivia inherited £120,000. Within six months, she'd spent £40,000 on a car, holidays, and loans to friends she never saw again.

"I thought 18 was old enough," James said. "I was wrong."

This scenario plays out more often than you'd think. When under-18s inherit money, it's automatically held in trust until age 18 under UK law. But is 18 mature enough to handle a substantial inheritance?

According to recent data, 49% of UK adults don't have a will, and intestate estates rose 17% to 51,140 in the last year – a five-year high. Of those who do make wills, many don't understand that trusts can provide additional protection beyond age 18.

This article will explain when trusts for children genuinely make sense, which type suits your family, and how to avoid the costly mistakes that catch many parents out.

Do You Actually Need a Trust for Your Children?

The first question isn't "which trust?" but "do I need one at all?"

Many parents think they need a complex trust when the automatic bare trust provisions are sufficient. Others genuinely need a trust but don't realize it until it's too late.

Here's what happens by default: UK law automatically creates a statutory trust when you leave inheritance to children under 18. This protection lasts until they turn 18, then they receive everything with no restrictions.

You should consider setting up a specific trust in your will if any of these apply:

Large inheritance: Your child will inherit more than £50,000 (substantial enough to cause harm if mismanaged)
Vulnerable children: Concerns about learning difficulties, addiction tendencies, or susceptibility to manipulation
Age 18 concerns: You believe 18 is too young for your children to handle their full inheritance responsibly
Complex family: Blended families, stepchildren, or situations requiring flexibility in distributions
Inheritance tax planning: Estates over £325,000 (or £500,000 if leaving your home to children) where trust structures can help manage tax

You probably don't need a specific trust if:

Modest estate: Total inheritance per child under £30,000
Straightforward family: Married couple, biological children, no complications
Confidence in age 18: You're comfortable with your children receiving everything at 18

Consider Sarah, a single parent with £850,000 in assets. Her two children, aged 8 and 11, would each inherit £425,000. Sarah chose a discretionary trust with distributions at ages 25, 28, and 30. She wanted trustees to assess each child's maturity and financial responsibility before releasing funds.

Compare this to Tom, who has £120,000 in savings and a straightforward family. His will leaves everything to his wife, then to their two children. The default statutory trust until age 18 provides sufficient protection for his situation.

The key is honest self-assessment: What's the inheritance size? What's your family structure? How mature will your children be at 18?

How Children Automatically Inherit Under UK Law (Without a Trust)

Understanding what happens without intervention helps you decide if you need to do anything different.

When you leave money to children under 18 in your will, sections 31 and 32 of the Trustee Act 1925 automatically create a statutory bare trust. Trustees (usually parents or guardians) hold and manage the money until the child turns 18.

At age 18, the child receives full access to both capital and income. No restrictions. No conditions. No questions asked.

The trustees can use the money for the child's benefit before age 18 – education, living expenses, healthcare. But they must act in the child's best interests and keep records.

If you die without a will (intestate), children still inherit through a statutory trust, but the distribution percentages follow intestacy rules. For example, if you're married with children and die intestate, your spouse receives the first £322,000 plus half the remainder. Children receive the other half when they turn 18.

According to Ministry of Justice data, intestate estates rose to 51,140 in the last year, up 17% from the previous year. This means tens of thousands of families are relying on statutory trusts and intestacy rules by default.

The critical limitation: Once your child turns 18, they can spend every penny however they choose. Some 18-year-olds are financially mature and responsible. Others aren't.

David discovered this when his son inherited £95,000 at 18. Within a year, most of it was gone – spent on a failed business venture with friends, a financed sports car, and a deposit on a rental apartment he couldn't afford. "He wasn't ready," David reflected. "Another five years would have made all the difference."

The Four Main Types of Trusts for Children

If you've decided a trust makes sense for your family, you need to understand the four main options. Each serves different purposes and has different legal and tax implications.

Bare Trusts

A bare trust gives the beneficiary (your child) an absolute right to the trust assets at a specific age – typically 18, 21, or 25. The trustees hold legal title, but the child has the beneficial interest from the start.

Bare trusts are the simplest option. You specify the age, appoint trustees, and they hold the assets until that birthday arrives. The child knows they'll definitely receive the inheritance at that age.

Tax treatment is straightforward: Income and gains are taxed as the child's, usually at lower rates. However, if you (the parent) are the settlor and income exceeds £100 per year, special parental trust rules apply and the income is taxed as yours.

The main limitation: No flexibility. Once established, the age is fixed. If circumstances change – your child develops addiction issues, gets into debt, or simply isn't mature at the specified age – you can't adjust the trust from beyond the grave.

Discretionary Trusts

Discretionary trusts give trustees full control over when and how much to distribute. You can specify guidance (like "consider distributing at ages 25, 28, and 30") but trustees have the legal power to adapt to circumstances.

This flexibility is powerful. If one child is responsible at 23, trustees can distribute early. If another child is struggling with debt at 30, trustees can delay or provide structured support.

Discretionary trusts can extend well beyond age 18 – to 25, 30, or even later. You can also include multiple beneficiaries and allow trustees to treat them differently based on their needs.

The downsides: More expensive to set up (£1,000+ with a solicitor for proper discretionary trusts), more complex tax treatment, and greater administrative burden on trustees.

Tax is where discretionary trusts get complicated. Income retained in the trust is taxed at 45% (or 39.35% for dividends), though beneficiaries can reclaim tax when distributions are made. There are also potential inheritance tax charges every 10 years and when capital is distributed.

Bereaved Minor Trusts

Bereaved minor trusts are a specific type for children who've lost a parent. They have special inheritance tax advantages if assets pass to the child by age 18.

Under sections 71A of the Inheritance Tax Act 1984, bereaved minor trusts face no inheritance tax charges at 10-year anniversaries or on distributions – a significant benefit for larger estates.

To qualify, the trust must be set up by a parent for their child or stepchild, and the child must become absolutely entitled to the assets by age 18.

These trusts work well when you want the tax advantages but your child is young enough that 18 seems far away. By the time they reach 18, they may be more mature than you feared.

18-to-25 Trusts

An 18-to-25 trust is a middle ground. The child must receive the assets by age 25, but trustees can delay distributions between ages 18 and 25.

Like bereaved minor trusts, 18-to-25 trusts have favorable inheritance tax treatment. Exit charges apply between ages 18 and 25, but the rates are much lower than standard discretionary trusts – a maximum of 4.2% if the child inherits at 25.

This option suits parents who want some extended protection beyond 18 but don't need the full flexibility (and complexity) of a discretionary trust.

Here's a comparison of all four types:

Trust Type	Control After 18	Flexibility	Tax Treatment	Best For
Bare Trust	None – fixed age	Very low	Simple – taxed as child's income	Straightforward families, confidence in specific age
Discretionary Trust	Full trustee control	Very high	Complex – 45% trust rate, 10-year charges	Large estates, vulnerable children, flexibility needed
Bereaved Minor Trust	None – must distribute by 18	Low	Favorable – no IHT charges	Young children, want IHT benefits, comfortable with age 18
18-to-25 Trust	Moderate – must distribute by 25	Moderate	Favorable – low exit charges	Extended protection without full discretionary complexity

Bare Trusts vs Discretionary Trusts: Which One is Right for You?

Most parents choosing a trust for children face this decision: bare trust or discretionary trust?

A bare trust is like setting a financial timer. You choose the age (21, 25, 30) and when that birthday arrives, your child receives everything. Simple. Certain. Inflexible.

Advantages of bare trusts:

Low cost – can often be included in a standard will for under £100
Straightforward tax treatment – income and gains taxed as the child's
Certainty for your child – they know when they'll inherit
Minimal administrative burden on trustees

Disadvantages of bare trusts:

No flexibility – can't adjust to changed circumstances
Child receives everything at specified age regardless of maturity
Can't protect vulnerable children beyond the specified age
Doesn't allow for different treatment of multiple children

Discretionary trusts are like appointing a financial guardian with wisdom and judgment. Your trustees assess each situation and make decisions based on what's actually happening, not what you predicted years earlier.

Advantages of discretionary trusts:

Full control – trustees decide when and how much to distribute
Can extend well beyond age 18 (to 25, 30, or later)
Protects vulnerable children from poor decisions, exploitation, bankruptcy, or divorce
Can adapt to circumstances you couldn't predict
Allows different treatment of children based on their individual needs

Disadvantages of discretionary trusts:

More expensive – typically £1,000+ with a solicitor for proper setup
Complex tax implications – 45% income tax rate, potential 10-year IHT charges
Greater administrative burden – trustees must keep records, file tax returns
No certainty for children – they don't know when they'll inherit
Can create family tension if children feel treatment is unfair

Here's a decision framework:

Choose a bare trust if:

Your estate is modest (under £500,000)
Your family is straightforward
You're confident in a specific age (21 or 25)
You trust your children will be mature enough at that age
You want simplicity and low cost

Choose a discretionary trust if:

Your estate is substantial (over £500,000)
You have concerns about a child's vulnerability
You want maximum flexibility to adapt to unknown futures
You have complex family circumstances (blended family, special needs)
You're willing to pay for professional setup and ongoing administration

Consider Mia, whose 15-year-old daughter was academically focused, financially responsible, and planning to study medicine. Mia chose a bare trust with distribution at age 25 – after her daughter would finish medical training but young enough to use the inheritance for a home deposit.

Contrast this with Aiden, whose teenage son was showing early signs of addiction issues. Aiden chose a discretionary trust, giving trustees the power to provide for his son's needs while protecting him from himself. Trustees could fund rehabilitation, provide housing, or give a modest income – but never hand over lump sums that could fuel addiction.

One critical warning: If you set up a discretionary trust for your own minor children and you're still alive, it becomes a "settlor interested" trust. Under HMRC rules, any income distributed to your minor children is taxed as your income at your marginal rate – potentially 45%. This harsh treatment is designed to prevent income splitting for tax avoidance.

This rule applies to trusts you set up while alive. Trusts created in your will and taking effect after your death don't face this problem, though parental trust rules still apply if income exceeds £100 per year.

Choosing the Right Age for Your Children to Inherit

One of the most common questions parents ask: "What age is right?"

The legal minimum is 18 in England and Wales, 16 in Scotland. Beyond that, you're making a judgment about maturity, financial literacy, and life experience.

Common ages parents choose:

Age 21: University completion. Your child has finished education and is entering the workforce, but still young enough to use the inheritance to start adult life (home deposit, career investment). However, many 21-year-olds still lack financial maturity.

Age 25: Career establishment. By 25, most people have several years of work experience, understand budgeting, and have made (and learned from) financial mistakes with smaller amounts. The average first-time buyer in the UK is now 34 years old, so 25 still allows time to use inheritance for a home.

Age 30: Mature financial judgment. At 30, brain development is complete (the prefrontal cortex, responsible for impulse control and planning, develops until about age 25). Most 30-year-olds have established careers, stable relationships, and demonstrated financial responsibility over years.

Staggered distributions: Many parents choose to split the inheritance: 25% at 21, 50% at 25, 100% at 30. This gives your child multiple opportunities to demonstrate financial responsibility. If they mismanage the first distribution, they still have future portions to learn from that mistake.

Research on brain development supports waiting. The prefrontal cortex – responsible for planning, impulse control, and assessing consequences – doesn't fully develop until the mid-20s. This explains why 18-year-olds often make impulsive financial decisions even when they intellectually understand the risks.

Financial independence is also arriving later. The average first-time buyer in England is now 34 years old, up from about 31 a decade ago. Many young adults aren't financially independent until their late 20s, suggesting that inheriting large sums earlier may not align with their readiness to manage money.

James and Sophie had three children: 16, 14, and 11. They set up a discretionary trust with guidance for trustees to consider distributions at age 25 for each child. But they included a provision: trustees could treat children differently based on their individual circumstances.

When the oldest turned 25, he'd completed an apprenticeship, saved a deposit, and demonstrated financial responsibility. Trustees distributed his full share. The middle child at 25 was still struggling with debt from poor decisions. Trustees provided a modest income and agreed to revisit when she turned 30.

This flexibility – only possible with a discretionary trust – meant each child was treated fairly based on their needs, not identically regardless of circumstances.

One warning: Setting the age too high can backfire. If you specify age 40 or 45, your adult children may resent the lack of trust and could potentially challenge the will. Courts generally respect testamentary freedom, but extremely late distribution ages without clear justification (like severe disability) may be questioned.

Who Should You Choose as Trustees?

Trustee selection is one of the most critical decisions you'll make. These people will control your children's inheritance and make life-changing decisions on their behalf.

Legal requirements first: You must appoint at least two trustees if the trust includes land or property (which most do – your home equity often forms part of the inheritance). You can appoint more than two for broader perspective.

Key qualities to look for:

Financial competence: Trustees need to manage money, make investment decisions, and understand basic tax obligations. They don't need to be accountants, but they should be financially stable and sensible.

Integrity: Trustees have a fiduciary duty under the Trustee Act 2000 to act in beneficiaries' best interests, not their own. Choose people you trust completely.

Relationship with your children: Trustees should know your children well enough to assess their needs, maturity, and circumstances. A distant relative may be financially competent but lack the personal knowledge to make nuanced decisions.

Willingness to serve: Being a trustee is work. It involves administrative tasks, potential conflicts with beneficiaries, and legal liability if duties are breached. Always ask potential trustees if they're willing before naming them in your will.

Longevity: Choose trustees who are likely to outlive the trust term. If you want distributions at age 30 and your children are currently under 10, trustees need to be around for 20-30+ years. Elderly parents may not be the best choice for long-term trusts.

Common trustee combinations:

Family + professional: Many families appoint one family member (who knows the children) plus one professional trustee like a solicitor or accountant (who has financial and legal expertise). This balances personal knowledge with professional competence.

Co-parents: If you're married, appointing both parents as trustees works while both are alive. Include replacement trustees in case you both die together.

Siblings + professionals: Your brother or sister who's financially stable, combined with a solicitor from a law firm that offers professional trustee services.

Grandparents + aunt/uncle: For younger children, a combination of older and younger relatives ensures continuity as the trust matures.

Common mistakes to avoid:

Choosing based solely on family relationship without considering financial skills. Your beloved but financially chaotic brother may not be the right trustee, even though you're close.

Not considering willingness. Some people don't want the responsibility, conflict, or time commitment. Ask first.

Forgetting to appoint replacements. What happens if a trustee dies, moves abroad, or becomes incapacitated? Include provisions for replacement trustees.

Rachel and Mark appointed Mark's best friend as sole trustee, thinking his financial background (he was an accountant) made him perfect. Five years after Mark's death, the friend moved to Australia for work. When their daughter turned 16 and needed funds for a private sixth form, the trustee was unreachable. It took months to get court approval for a replacement trustee.

If they'd appointed two trustees (the friend plus Mark's sister), continuity would have been maintained.

Professional trustees charge fees – typically 1-2% of the trust assets annually, plus additional fees for administration. For a £500,000 trust, that's £5,000-£10,000 per year. These fees can add up over a 20-year trust term.

However, for very large estates (£1m+), complex family situations, or when there's no suitable family member, professional trustees provide expertise, impartiality, and protection from claims of trustee breach.

Trustee duties are significant. Under the Trustee Act 2000, trustees owe a statutory duty of care when investing trust assets, must exercise their powers in beneficiaries' best interests, and can be personally liable if they breach their duties or act negligently.

This is why you should choose trustees carefully and why many people include at least one professional to reduce the risk of breaches.

Tax Implications of Children's Trusts

Tax complexity frightens many parents away from trusts. Let's make it accessible without oversimplifying.

Bare Trusts – Simple Tax Treatment

Income and capital gains in a bare trust are taxed as the child's. If the child has no other income, they can use their personal allowance (£12,570 for income, £3,000 for capital gains) before paying tax.

However, there's an important exception: If you (the parent) are the settlor and the trust generates more than £100 income per year for your minor child, all the trust income is taxed as yours, not the child's. This anti-avoidance rule prevents parents from splitting income through trusts.

This rule applies to trusts you set up while alive. For trusts created in your will taking effect after your death, the concern is different – the child may pay tax if their total income exceeds allowances, but the income isn't attributed back to you (because you're deceased).

Discretionary Trusts – Complex Tax Treatment

Discretionary trusts face harsher taxation to discourage their use for tax avoidance.

Income retained in discretionary trusts is taxed at 45% (the additional rate), or 39.35% for dividends. The first £500 of income is tax-free (the standard rate band for trusts), but everything above that is taxed at the trust rate.

When income is distributed to a beneficiary, they receive a 45% tax credit. The beneficiary reports the distribution on their tax return and may reclaim some or all of the tax if their marginal rate is lower than 45%.

Capital gains are taxed at 20% (or 24% for residential property). Trusts have their own capital gains annual exemption of £1,500 (half the individual exemption).

Inheritance tax adds another layer. Discretionary trusts are "relevant property trusts" under the Inheritance Tax Act 1984. This means:

10-year anniversary charges: Every 10 years, the trust pays IHT at up to 6% on assets exceeding the nil-rate band (£325,000).
Exit charges: When capital is distributed, an exit charge applies based on how long the assets were in the trust and how much time has passed since the last 10-year anniversary.

In practice, these charges are often small or nil for modest family trusts. A £500,000 trust would pay a maximum 6% on £175,000 (the excess above £325,000) every 10 years – that's £10,500 every decade, or about £1,050 per year. Many families consider this worthwhile for the protection discretionary trusts provide.

Bereaved Minor Trusts – Favorable Tax Treatment

Bereaved minor trusts have special tax advantages. If assets pass to the child by age 18, there are:

No 10-year anniversary charges
No exit charges
No entry charges

This makes bereaved minor trusts significantly more tax-efficient than standard discretionary trusts. The trade-off is loss of flexibility – assets must be distributed by 18.

18-to-25 Trusts – Moderate Tax Treatment

18-to-25 trusts sit between bereaved minor trusts and full discretionary trusts. There are no 10-year anniversary charges, but exit charges apply when capital is distributed between ages 18 and 25.

The exit charge is a fraction of 6%, based on how long after age 18 the distribution occurs:

Inherit at 21: 3/10 of 6% = 1.8%
Inherit at 23: 5/10 of 6% = 3.0%
Inherit at 25: 7/10 of 6% = 4.2%

These rates are much lower than standard discretionary trust charges, making 18-to-25 trusts attractive for parents who want some extended protection without full discretionary complexity.

According to HMRC statistics, around 4.6% of deaths attracted inheritance tax in 2022-23. Over the last 10 years, an average of £60m was put into trust annually, but fewer than 100 contributions paid any tax. This suggests most family trusts have low or no tax impact because the value falls below the nil-rate band.

When to get specialist tax advice:

Estates over £325,000 (potentially liable for inheritance tax)
Multiple properties or investment portfolios
Business assets or agricultural property
Complex family structures (blended families, previous marriages)
Disabled beneficiaries requiring specialist trust structures
International assets or beneficiaries abroad

Key warning about settlor-interested trusts:

If you set up a trust for your own minor children while you're alive and you might benefit from it (directly or indirectly), it's "settlor interested." Any income distributed to your minor children is taxed as your income at your marginal rate – potentially 45%.

This doesn't apply to trusts created in your will that only take effect after your death, but it's a crucial consideration if you're setting up trusts while alive as part of estate planning.

Tax rules for trusts are complex and change regularly. The information here is current as of October 2025, but may not reflect recent changes. For tax planning advice specific to your situation, consult a qualified tax advisor or solicitor.

Common Mistakes Parents Make (And How to Avoid Them)

Researching trust disputes, court cases, and professional guidance reveals eight common mistakes that cost families money, cause disputes, or fail to protect children as intended.

Mistake 1: Not Setting Up a Trust When One Is Needed

Many parents assume 18 is automatically appropriate because it's the legal age of adulthood. But maturity and legal adulthood aren't the same thing.

Emma's son inherited £140,000 at 18. He'd never managed more than his part-time job wages. Within 18 months, most of the money was gone – a financed BMW he couldn't afford to insure, loans to friends that were never repaid, and a failed cryptocurrency investment.

How to avoid it: Honestly assess whether your child will be financially mature at 18. If you have doubts, consider extending the age to 21, 25, or later. Remember: you can always give your child money while you're alive if they demonstrate readiness. But once they inherit at 18 and spend it, it's gone.

Mistake 2: Setting Up Unnecessary Trusts

The opposite mistake: creating expensive, complex trust structures when simple provisions would work fine.

David paid £2,800 to a solicitor for a discretionary trust for his £180,000 estate. His children were 12 and 14, responsible, from a straightforward family. A simple will raising the inheritance age to 25 would have achieved his goals for £100.

How to avoid it: Don't let solicitors oversell complexity. If your estate is modest, your family is straightforward, and you just want to delay inheritance beyond 18, a simple age-raising provision in a standard will is often sufficient. Save complex trusts for complex situations.

Mistake 3: Choosing Trustees Poorly

Trustees need financial competence, integrity, and longevity. Choosing based solely on family relationship often backfires.

Sarah appointed her elderly parents (ages 72 and 76) as trustees for a trust lasting until her daughter turned 30. Her daughter was 8 when Sarah died. Twenty-two years later, both trustees had passed away, requiring expensive court proceedings to appoint replacements.

How to avoid it: Choose trustees who'll outlive the trust term. Mix older and younger trustees for continuity. Always appoint replacement trustees in case of death, incapacity, or unwillingness to continue. Consider including at least one professional trustee for large or long-term trusts.

Mistake 4: Vague or Incomplete Trust Documents

Vague trust terms lead to disputes. "When my trustees think appropriate" or "when my children are mature" are unenforceable.

Michael's will said trustees should distribute "when my son demonstrates financial responsibility." The trustees disagreed on what that meant. One thought buying a house showed responsibility. Another thought the son's £15,000 credit card debt proved he wasn't ready. Legal fees to resolve the dispute cost £12,000.

How to avoid it: Be specific. State clear ages (25, 30) or measurable conditions (completing university, being debt-free for 2 years). If you want flexibility, use a discretionary trust with a letter of wishes giving guidance, but accept that trustees have final say.

Mistake 5: Not Communicating with Trustees

Many people don't tell trustees they've been appointed until after death. Some trustees only discover their appointment during probate – and decline to serve, causing delays.

Rachel named her colleague as trustee without asking. When Rachel died, the colleague was in the middle of a divorce, relocating abroad, and in no position to take on trustee duties. Finding a replacement took 14 months.

How to avoid it: Always ask potential trustees if they're willing to serve before naming them in your will. Explain what's involved: managing money, keeping records, making distribution decisions, potential conflict with beneficiaries. If they're not fully committed, choose someone else.

Mistake 6: Ignoring Tax Implications

Trust taxation is complex, and mistakes can be costly. The settlor-interested trust rules are particularly harsh.

James set up a trust for his minor children while he was alive, transferring £200,000 of investments. The trust generated £8,000 annual income. Under settlor-interested trust rules, all £8,000 was taxed as James's income at his 45% marginal rate – £3,600 per year in unnecessary tax.

How to avoid it: Understand the tax implications of the trust type you choose. For discretionary trusts or estates over £325,000, get professional tax advice. If setting up trusts while alive (rather than in your will), beware of settlor-interested rules. For trusts in wills, remember that parental trust rules still apply if income exceeds £100 per year.

Mistake 7: Not Reviewing the Trust Regularly

Circumstances change: marriage, divorce, more children, disability, financial windfalls. A trust that made sense when your children were 5 may be inappropriate when they're 25.

Sophie's will created a trust for her daughter with distribution at age 25. When her daughter was 22, she was diagnosed with a severe disability requiring lifetime care. The bare trust couldn't be changed. At 25, she inherited £380,000, immediately making her ineligible for benefits and creating massive complications.

How to avoid it: Review your will and trust provisions every 3-5 years or after major life events (divorce, remarriage, birth, disability). If circumstances change significantly, update your will. For maximum flexibility in unknown futures, consider discretionary trusts over bare trusts.

Mistake 8: Giving Access Too Early Without Considering Life Stage

Age isn't the only factor. Life stage matters too. An immature 25-year-old in a relationship with a financially manipulative partner may be less ready than a responsible 21-year-old with stable career and independent judgment.

Tom's will gave his son full inheritance at 21. At 21, his son was in a controlling relationship with a partner who immediately pressured him to buy a house in joint names and lend money to her family. Within two years, the relationship ended and half the house value was gone.

How to avoid it: Staggered distributions allow trustees (or you, through a discretionary trust) to assess life stage, not just age. Alternatively, include provisions in a letter of wishes guiding trustees to consider relationship stability, financial independence, and demonstrated responsibility before distributions.

According to recent data, probate cases taking longer than one year increased 518% from 2019 to 2024, with as many as 10,000 people currently disputing wills and estates in England and Wales. Many of these disputes involve trust provisions – unclear terms, trustee decisions beneficiaries disagree with, or mistakes in trust setup.

These mistakes are avoidable. Clear terms, thoughtful trustee selection, appropriate trust types for your situation, and regular reviews prevent most problems.

How to Include a Trust in Your Will

You've decided a trust makes sense. Now you need to actually implement it. You have three options depending on your situation's complexity.

Option 1: Simple Age-Raising Provision

For straightforward situations, you can include a simple provision in your will raising the inheritance age beyond 18. This might say: "My children shall inherit my estate in equal shares when they reach age 25."

This is suitable if:

Your estate is relatively modest (under £500,000)
Your family is straightforward (no blended family, no disabled children)
You simply want to delay inheritance to 21, 25, or 30
You don't need ongoing trustee discretion

Most online will services (including WUHLD) allow you to specify inheritance ages beyond 18 in a standard will. This achieves basic protection without complex trust structures or solicitor fees.

Option 2: Specific Trust Clause in Your Will

For more complex requirements – staggered distributions, multiple trustees with specific powers, detailed guidance – you need a specific trust clause in your will.

Required elements in any trust clause:

Identify beneficiaries: Name your children (or other beneficiaries) specifically Specify trustees: Name at least two trustees and include provisions for replacement trustees State distribution age or conditions: Be specific about when inheritance should be distributed Outline trustee powers: What can trustees do? Invest? Distribute capital early for specific purposes like education or home purchase? Include letter of wishes: Non-binding guidance expressing your intentions

A letter of wishes might say: "I wish my trustees to consider the following when making distribution decisions: whether my children have completed university, demonstrated financial responsibility for at least two years, are debt-free, and are in stable employment. I hope trustees will prioritize funding further education or first home purchases over distributions for discretionary spending."

Letters of wishes aren't legally binding, but trustees must consider them when making decisions.

Option 3: Separate Trust Deed

For very complex estates – multiple properties, business interests, international assets, disabled beneficiaries – you may need a separate trust deed created alongside your will.

This approach requires a solicitor and typically costs £1,500-£3,000+. It's necessary when:

Your estate exceeds £1m
You need complex discretionary provisions
You're planning for disabled beneficiaries (to protect benefits eligibility)
You have business succession issues
International assets or beneficiaries are involved

WUHLD's Approach

WUHLD's online will service (£49.99) allows you to:

Specify distribution ages beyond 18 (21, 25, 30, or custom ages)
Name trustees (minimum two for land/property)
Include basic protective provisions for children

This is suitable for most families with straightforward estates who want to extend protection beyond age 18 without the complexity and cost of full discretionary trusts.

What WUHLD can't handle:

Complex discretionary trusts with full trustee discretion
Disabled person's trusts
Inheritance tax planning for estates over £1m
Business succession trusts
International trusts or beneficiaries abroad

For these complex situations, you need a solicitor. Typical costs:

Simple will with basic trust provisions: £150-£400
Standard discretionary trust will: £1,000-£1,500
Complex trusts for disabled beneficiaries or IHT planning: £1,500-£3,000+

The decision between DIY and solicitor depends on complexity, not just estate value. A £800,000 estate with a straightforward family might need only basic provisions. A £400,000 estate with a disabled child requires specialist advice.

When in doubt, start with the simpler option. You can always update your will later if circumstances change. It's better to have a simple will now than to delay for years trying to create the "perfect" complex trust.

Real-World Scenarios: Which Trust is Right for Your Family?

Let's bring everything together with detailed scenarios you can pattern-match to your own situation.

Scenario 1: Young Children, Modest Estate, Married Couple

Family: Married couple, ages 34 and 36, two children aged 6 and 8

Estate: £320,000 (£240,000 home equity, £50,000 life insurance each, £30,000 savings)

Concerns: "Our children are too young to manage money at 18. We want them to finish university first."

Recommendation: Simple will with age 21 or 25 provision. No complex trust needed.

Reasoning: The estate is modest enough that simple provisions work fine. Raising the inheritance age to 21 (university completion) or 25 (career establishment) provides protection without complexity or cost.

Implementation: Use an online will service (like WUHLD for £49.99) to create a standard will specifying that children inherit equally when they reach age 25. Name two trustees (perhaps a sibling from each side of the family).

What happens without a trust: Children would inherit everything at 18 under statutory trust – potentially before they're financially mature, especially for the £85,000+ per child they'd inherit.

Scenario 2: Teenagers, Large Estate, Concerns About Maturity

Family: Married couple, ages 46 and 48, three children aged 14, 16, and 18

Estate: £950,000 (£620,000 home, £200,000 pensions, £80,000 investments, £50,000 savings)

Concerns: "One of our children is responsible, but another has made poor financial decisions. We're not confident they'll all be ready at the same age. Also concerned about inheritance tax."

Recommendation: Discretionary trust with staggered distribution guidance (25%, 50%, 100% at ages 25, 28, 30) and professional trustee.

Reasoning: The large estate, mixed maturity levels, and IHT concerns justify the complexity and cost of a discretionary trust. Trustees can treat children differently based on their demonstrated responsibility.

Implementation: Engage a solicitor to draft a discretionary trust will (£1,200-£1,800). Appoint three trustees: the surviving spouse, a trusted family friend, and a professional trustee (solicitor or accountant). Include a letter of wishes outlining your distribution preferences and circumstances to consider (education completion, financial stability, debt-free status).

What happens without a trust: With estates over £650,000 (once both spouses die), inheritance tax will apply to amounts exceeding the nil-rate band and residence nil-rate band. Children would inherit at 18 (or whatever age specified in a simple will) regardless of maturity, with no flexibility for individual circumstances.

Scenario 3: Child with Disability, Any Estate Size

Family: Single parent, age 42, one child aged 12 with learning disabilities

Estate: £280,000 (£180,000 home equity, £100,000 life insurance)

Concerns: "My son receives disability benefits and may need ongoing support. I want to provide for extras without affecting his benefits eligibility."

Recommendation: Disabled person's trust (specialist trust) set up by solicitor.

Reasoning: Disabled person's trusts allow you to provide for your child's needs – holidays, equipment, therapies – without the inheritance counting against means-tested benefits like Universal Credit or Personal Independence Payment.

Implementation: Consult a solicitor specializing in disability trusts (typically £1,500-£2,500). The trust will hold the inheritance and trustees can make distributions for your son's benefit without affecting his benefits. This requires careful drafting to meet HMRC requirements.

What happens without a trust: If your son inherits £280,000 directly, he'd likely lose means-tested benefits until the money is spent down below threshold levels (typically £16,000). This could cost him tens of thousands in benefits over his lifetime.

Scenario 4: Blended Family, Mix of Biological and Stepchildren

Family: Remarried couple, ages 44 and 46, two biological children (ages 11 and 13) from previous marriages, one child together (age 5)

Estate: £680,000 combined (£420,000 home, £160,000 pensions, £100,000 savings/investments)

Concerns: "We want all three children treated fairly, but we're not sure 'equally' is the same as 'fairly' given the age differences. We also want to ensure our biological children aren't disadvantaged if one of us dies first."

Recommendation: Discretionary trust allowing trustees to consider each child's needs, with clear letter of wishes outlining your intentions for equal treatment.

Reasoning: Blended families often have complexity around fair vs equal treatment. A discretionary trust allows flexibility – perhaps the older children get distributions for university or home deposits earlier, while the younger child's share grows until their needs arise.

Implementation: Solicitor-drafted discretionary trust will (£1,500-£2,000). Appoint trustees from both sides of the family plus a professional to maintain impartiality. Letter of wishes should explicitly state your intention to treat all children equally overall while recognizing timing may differ based on age and need.

What happens without a trust: Without careful planning, blended family estates often end up favoring the surviving spouse's biological children or creating family disputes about "fairness." Rigid equal distributions at fixed ages may not work when children are different ages with different needs.

Scenario 5: Single Parent, Unmarried Partner, Young Children

Family: Single mother, age 36, unmarried partner (age 38), two children from previous relationship (ages 4 and 7)

Estate: £380,000 (£210,000 home equity, £120,000 life insurance, £50,000 savings)

Concerns: "I want my partner to be able to support my children financially if I die, but I don't want to leave everything to him directly. What if he remarries? What if he dies and his family inherits instead of my children?"

Recommendation: Discretionary trust with surviving partner and independent trustee, protecting children while allowing partner to access funds for their benefit.

Reasoning: This structure ensures your children's inheritance is protected while allowing your partner (as trustee) to use funds for their care. The independent co-trustee prevents any appearance of self-dealing if your partner benefits indirectly (e.g., by living in a home purchased for the children).

Implementation: Solicitor-drafted discretionary trust (£1,000-£1,500). Name your partner and an independent person (sibling, friend) as trustees. Letter of wishes should clarify that trustees may use trust funds for children's living expenses, education, and housing – which may incidentally benefit your partner if he's caring for them.

What happens without a trust: If you leave everything to your partner, he legally owns it. If he remarries or dies, your children's inheritance could go to his new spouse or his family. If you leave everything directly to your children, your partner may struggle to support them without legal authority to access funds.

Each scenario shows a different trust solution for different circumstances. The common thread: match the trust type to your family's actual needs, not to what sounds most sophisticated or what someone else chose.

Trust provisions are just one part of comprehensive estate planning. You also need to consider guardianship decisions, life insurance coverage, property ownership structure, and pension beneficiaries. Learn more about estate planning for new parents to understand how all these elements work together.

Frequently Asked Questions

Q: Do I actually need to set up a trust for my children in my will?

A: Not always. UK law automatically creates a statutory trust when you leave inheritance to children under 18, which lasts until they turn 18. You only need to set up a specific trust if you want to extend protection beyond age 18, create flexibility in distributions, protect vulnerable children, or manage inheritance tax on larger estates. Many families with straightforward estates and confidence in age 18 don't need complex trusts.

Q: What's the difference between a bare trust and a discretionary trust for children?

A: A bare trust gives your child absolute rights to the trust assets at a specified age (usually 18-25), while a discretionary trust allows trustees to decide when and how much to distribute, potentially extending beyond age 25. Bare trusts are simpler and have easier tax treatment; discretionary trusts offer more control but are more expensive and complex to administer. Choose a bare trust for straightforward situations; choose a discretionary trust when you need maximum flexibility.

Q: What age should I choose for my children to inherit?

A: The legal minimum is 18 (England/Wales) or 16 (Scotland). Common ages are 21 (university completion), 25 (career establishment), or 30 (financial maturity). Many parents choose staggered distributions – for example, 25% at 21, 50% at 25, 100% at 30 – giving children multiple opportunities to demonstrate financial responsibility. Consider your children's likely maturity, the inheritance size, and current age of financial independence (the average first-time buyer in the UK is now 34 years old).

Q: Who should I appoint as trustees for my children's trust?

A: Choose at least 2 trustees (required if the trust includes property) based on: financial competence, integrity, relationship with your children, willingness to serve, and longevity (will they outlive the trust term?). Many families appoint a combination of family members (who know the children) and professionals (who have financial expertise), such as a sibling plus an accountant. Always discuss the role with potential trustees before appointing them in your will.

Q: Are trusts for children complicated for tax purposes?

A: It depends on the type. Bare trusts have relatively simple tax treatment, with income and gains taxed as the child's. Discretionary trusts are more complex, with trust income taxed at 45% (39.35% for dividends). However, trusts set up for your own minor children can be "settlor interested" with harsh tax treatment where income over £100 per year is taxed as the parent's income. For estates over £325,000 or complex discretionary trusts, seek professional tax advice.

Q: Can I set up a trust in my will using an online service like WUHLD?

A: WUHLD's £49.99 will service allows you to include basic trust provisions like raising the inheritance age to 21, 25, or beyond, and appointing trustees. This is suitable for most families with straightforward estates who want simple age-raising provisions. However, complex discretionary trusts, disabled beneficiary trusts, or inheritance tax planning trusts require professional legal advice from a solicitor.

Q: What happens if I don't set up a trust and my children inherit at 18?

A: They receive their full inheritance at age 18 with no restrictions and can spend it however they wish. For some mature 18-year-olds with modest inheritances, this may be fine. But for larger inheritances or concerns about financial maturity, an 18-year-old may not be ready to handle a substantial sum, potentially spending it quickly or making poor financial decisions that affect their long-term financial security.

Q: Can I treat my children differently in a discretionary trust?

A: Yes. Discretionary trusts allow trustees to distribute different amounts to different beneficiaries based on their needs and circumstances. For example, if one child has a disability requiring more financial support, or another child demonstrates particularly responsible financial behavior, trustees can adjust distributions accordingly (following your letter of wishes). This flexibility is one of the main advantages of discretionary trusts over bare trusts with fixed distributions.

Protecting Your Children's Financial Future

Protecting your children's inheritance isn't about controlling them from beyond the grave. It's about giving them the best chance of financial security by receiving assets when they're mature enough to manage them wisely.

Whether that's at 18 with a simple statutory trust, at 25 with a basic age-raising provision, or with ongoing trustee oversight through a discretionary trust, the right choice depends on your family, your estate, and your children's needs.

Key takeaways:

UK law automatically protects children under 18 with a statutory trust until they turn 18 – you don't need to create a trust unless you want to extend protection beyond age 18, add conditions, or create flexibility in distributions.
Four main trust types serve different needs: Bare trusts for simple age-raising (e.g., 21 or 25), discretionary trusts for maximum flexibility, bereaved minor trusts for tax-efficient inheritance when a parent dies, and 18-to-25 trusts for extended protection without full discretionary complexity.
Trustee selection is critical – choose at least 2 people who combine financial competence, integrity, relationship with your children, and longevity. Many families combine a family member (who knows the children) with a professional (who has financial expertise).
Tax complexity varies dramatically – bare trusts have simple tax treatment; discretionary trusts for your own minor children can face harsh "settlor interested" tax rules. For estates over £325,000 or complex discretionary trusts, professional tax advice is essential.
Most families don't need expensive solicitor fees – if your situation is straightforward (raising inheritance age to 21-25, appointing trustees, no complex tax planning), online will services can include the basic trust provisions you need.

The hardest part isn't choosing the right trust. It's making the decision at all. 49% of UK adults don't have a will, leaving their children's inheritance to statutory rules and court decisions rather than their own choices.

Ready to protect your children's future? WUHLD's online will service lets you specify inheritance ages beyond 18, appoint trustees, and include protective provisions for your children – all for a one-time payment of £49.99.

Create your will in just 15 minutes, preview it free before paying (no credit card required), and receive 4 complete documents:

Your legally binding will
A 12-page Testator Guide explaining how to execute your will properly
A Witness Guide to give to your witnesses
A Complete Asset Inventory document

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For complex situations requiring discretionary trusts, disabled beneficiary planning, or estates over £1m, we'll be transparent: you need a solicitor. But for most families, simple trust provisions in a well-drafted will provide the protection your children need at a fraction of the cost.

Don't let another year pass without protecting your children's financial future.

Legal Disclaimer: This article provides general information about trusts for children in UK wills and does not constitute legal or tax advice. Trust law and tax rules are complex and change regularly. For advice specific to your individual situation, particularly for estates over £325,000, complex family structures, or disabled beneficiaries, please consult a qualified solicitor and/or tax advisor. WUHLD's online will service is suitable for straightforward UK estates with basic trust provisions; complex trust arrangements require professional legal advice.

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