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Normal Expenditure out of Income - WOL

LLBLLB Member
in Technical stuff

If married couple set up a second death whole of life policy in discretionary trust (to pay IHT bill) and their two sons are trustees and discretionary beneficiaries, are the sons allowed to help their parents by paying towards the monthly premiums for the WOL policy? The intention being that both the parents’ and the sons’ payments would eventually qualify for the normal expenditure out of surplus income exemption. Any thoughts would be greatly appreciated!

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Comments

  • richardgoughrichardgough Member

    I think you are going to end up with GROB and muddy the waters as to who is the settlor(s) of the trust. If the children pay into the Trust, then you have created a Settlor interested arrangement with all the consequences of that.

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