Asset protection trusts – good or bad for IHT?

[Steve_W]

My mum & dad are starting to think of how to pass things on to my sister and I and are looking to reduce the inheritance tax we’d have to pay.

As well as the family home they have a couple of other rental properties (were their parents’ homes) – total estimated value about £1.5 million.

Mum called me up the other day to say they were looking at an asset protection trust to stave off the IHT due when they die and what did I think? I’d never heard of them, but it’s this firm:

http://www.universalwealthpreservation.co.uk/wealt...

Are these things good sense, a bad idea, or even some form of scam?

A quick Google shows that, as I understand it, you still have to pay 20% IHT when setting a trust up so not sure how much of a saving this sort of scheme would even be?

None of us have financial backgrounds; they don’t have an accountant as they do their own income tax returns, they have a solicitor but no idea on his IHT abilities; and they don’t have an IFA – Mum said she doesn’t know how to find a good one so if anyone knows a decent IFA in the Taunton (Somerset) region we’d be pleased to hear.

Thanks in advance,
Steve

[Steve_W]

Thanks gents - appreciate your feedback.

Dale, if your chap covers Somerset I'd appreciate his details if you want to PM them to me. My folks are the old fashioned sort who prefer face to face meetings rather than anything online.