Blog

Life is complicated with many people now having to consider second marriages, estranged children, potential future care costs, and vulnerable beneficiaries when it comes to planning their Will.

For couples who own a property together, instead of leaving their share of the property to the surviving partner outright, a common theme today is to leave their respective shares of their property on death to a Liferent Trust for the surviving partner created under their Will. This means the surviving partner can continue living in the house for as long as they wish without actually owning it.

Then, on the termination of the Liferent Trust, the property passes to the beneficiaries chosen by the partner who died first. This enables the ultimate beneficiaries to be “fixed” in advance of the second partner’s death, without the possibility of the surviving partner being able to change these beneficiaries. Advantageous when children are involved from a previous marriage, this planning can therefore help to avoid the possibility of “sideways disinheritance” – when the surviving partner’s own children inherit the property to the exclusion of the children of the partner who died first (e.g. by the surviving partner changing their Will after the first death) or to a new partner inheriting (e.g. if the surviving partner remarries or enters into a new relationship and dies without a Will). 

As well as protection against sideways disinheritance, the Liferent Trust arrangement also has the advantage that the capital value of the Trust’s share of the property should not be taken into account by the local authority in calculating care costs contributions in the event that the surviving partner ever requires long-term care.