30 November 2006. Following a comprehensive review of its trust proposition, Zurich, through its investment brand Sterling, has now launched another new trust to give intermediaries and their customers more choice for inheritance tax (IHT) planning.
Available immediately, the Sterling Discretionary Loan Plan Trust has been introduced in response to the changes to the taxation of some trusts following the Finance Act earlier this year.
The trust can be used with the Sterling Investment Bond and together they ensure that future investment growth remains outside of the settlor's estate for Inheritance Tax purposes.
Unlike some other trusts, such as bare trusts, a discretionary trust offers flexibility. Changes to the beneficiaries can be made at any time during the trust period, and none of the trust fund is included in any of the beneficiaries' estates for IHT purposes. Alternatively the existing bare trust version (Sterling Loan Plan (Bare) Trust) is a suitable option for those who are prepared to fix their beneficiaries and make no changes to them, but want to avoid the IHT treatment that applies to discretionary trusts.
This enhanced trust proposition demonstrates Zurich's ongoing commitment to offering intermediaries and their customers a choice of solutions that respond to the changing world we live in.
The range now includes three bare trusts and three discretionary trusts available with Sterling's Investment Bond and a bare and discretionary trust for use with Zurich's Whole of Life Plan (which now offers both reviewable and guaranteed premium payment options).
Paul Wright, Zurich's Investment Management Director, comments: "The launch of our new Discretionary Loan Plan Trust completes our review of our core trust proposition following the changes in the Finance Act. As IHT affects a growing number of people in the UK and becomes an increasingly important part of the financial planning process, we are now able to offer intermediaries and their customers a wide choice of market leading solutions to mitigate a potential IHT liability."
For more information:
please contact Nicola Bryson,
Senior Media Relations Consultant on 01793 503354 or 07734 336281
Notes to Editors
This new trust is a loan-only trust and so there is no gift. The settlor (the person creating the trust) does not make a transfer into trust for IHT purposes and so there are no initial or entry tax charges or HM Revenue & Customs (HMRC) reporting requirements at outset. The other charges which sometimes apply to discretionary trusts (periodic and exit charges) may apply to this new trust and would need reporting to HMRC.
This new trust is offered in addition to those already written/rewritten since the Finance Act:
- Zurich and Sterling Absolute Trusts - bare trusts launched in July 2006.
- Sterling Discounted Gift (Bare) Trust - launched in June 2006.
- Sterling Loan Plan (Bare) Trust - launched in June 2006.
- Sterling Discretionary Discounted Gift Trust - launched on 3 October 2006.
- Zurich and Sterling Discretionary Trusts - launched on 19 October 2006.
Zurich Financial Services Group (Zurich) is an insurance-based financial services provider with a global network of subsidiaries and offices in North America and Europe as well as in Asia Pacific, Latin America and other markets. Founded in 1872, the Group is headquartered in Zurich, Switzerland. It employs approximately 55,000 people serving customers in more than 120 countries.
