Living Trust

[capricorn62]

My home is in trust for my adult children & I know I can sell it.
Do I need to tell them before I go ahead & put on the market. Will they need to sign papers?
As I want to release some money I wish to down size to let my offspring have much needed cash to help them whilst I'm alive. Will they incur any tax problems?

[Peter Pedant]

well it all depends what the documents setting up the trust say
that answers q 1,2,3

q 4 - well it may do - taxation of trusts is very complicated

Barmaid is a trust expert and may contribute

The problem is your first sentence: "My home is in trust for my adult children & I know I can sell it." Trsuts are a vehicle which are specifically for someone such as yourself to have the benefit but NOT be able to dispose of the capital.

I can imagine that your dear husband now not living has given you a life interest in the house and then the remainder to the children. If that is the case and he died after March 1986 there are some quite complicated tax rules apply. or my imagination is running away with me,

[capricorn62]

I put my house into a Life Interest Trust with the ability to be able to sell my home but I have to either buy another with the money are give the cash to the kids.
Unfortunately my dear husband died several years ago leaving no will & as he was self employed, a nightmare! I certainly don't want the same ordeal for my 2 children.
They are due to inherit everything, but woudn't it be nice to let them have some now?

[Peter Pedant]

I think you need advice - probably from the fella who drew up the trust in the first place

If the trust deed allows you to sell then you dont need anyone's permission - but I think your children may notice anyway

from a site:
Tax treatment
The trustees are responsible for declaring and paying income tax and capital gains tax. The income received belongs to the life tenant and is taxed at their personal income tax rate.

For capital gains tax, the trust is taxed. The trust will have an annual allowance to offset against the gain.

If the life tenant lives in the trust property as their principal private residence and that property is sold, it is not subject to capital gains tax.

For inheritance tax purposes, the trust will be treated differently depending on whether it was established in your lifetime or by your Will.

If in your lifetime, inheritance tax may be due when:
On each ten year anniversary of the Trust
When assets are put into the trust
When assets are transferred out

oo-er strikes me you need professional advice !

[capricorn62]

Thanks for that I will contact my solicitor.