This guide explains how to enter Loan Trusts, DGTs and Other Trusts. These are all added via Dashboard - + button - Savings & Investments - Investment - Type.
Looking at each of the above trusts in turn.
Loan Trust
The Loan Balance will be credited back to the estate on mortality
Any growth is treated as outside of the estate
By the final year this trust entered above with a Loan Balance of £1,000,000 is worth £1,922,501.
Click on Year View - Investments tab for the last year in the plan to see this:
Go to the Legacy tab.
The original loan is shown as a credit to the estate.
The Growth is not included in the estate value and it shows as a 'Distribution outside of estate'
Finally, you could look at the Potential IHT Insight to compare a plan with a loan trust to one without.
Guide here: Potential IHT Insight - UK
Look at the differences to the IHT value and the Net Worth After Tax in Legacy - Comparison View -Detailed view
In terms of moving money into a Loan Trust in Voyant:
|
Loan Trusts |
||
|
Transfer into Trust more than 7 years before start of Voyant plan |
Transfer into trust within previous 7 years |
Transfer into Trust in Start year or any other future year in Voyant |
|
Enter details. Is this an existing investment is Yes. Nothing else needed |
Enter details. Is this an existing investment is Yes. No need to capture PETs/CLTs as it is a Loan Trust and the capital will come back into the estate if not spent. See the Legacy screen. |
Is this an existing investment - No. Transfer money in using the Transfer action (Dashboard - + button - Transfers) |
DGT
Enter the Discount Amount which will be the amount immediately removed from the estate for IHT purposes. The Income Amount will be paid in the plan annually.
Note for DGTs you need to nominate beneficiaries or it will assume it goes back to the estate on death.
Go to the DGT entry - Beneficiaries and select 100% to Persons outside of plan to remove from the estate for IHT purposes.
Go to the Legacy tab to check
If you run an Immediate Mortality scenario, the Total Value of the PET/CLT will not include the Discounted Amount in 'Total Value'.
£3,000 annual exempt amount is deducted to give the Non-exempt PET/CLT value.
Note we do not currently have the functionality to enter in Joint DGTs, you would need to enter separately. Get in touch with support@planwithvoyant.com if you have any questions on this.
Finally, you could look at the Potential IHT Insight to compare a plan with a trust to one without.
Guide here: Potential IHT Insight - UK
Look at the differences to the IHT value and the Net Worth After Tax in Legacy - Comparison View - Detailed view
In terms of setting up existing and new DGTs:
|
DGT |
||
|
Transfer into Trust more than 7 years before start of Voyant plan |
Transfer into trust within previous 7 years |
Transfer into Trust in Start year or any other future year in Voyant |
|
Enter details. Is this an existing investment is Yes. Enter Year Purchased. |
Enter details. Is this an existing investment is Yes. Previous PETs/CLTs captured by 'Year Purchased' which you enter in the main screen. Treated as a PET if a Bare Trust and a CLT if Discretionary |
Is this an existing investment - No. The start event will determine when the DGT is purchased. It will be considered a gift made from that point. Depending on the Trust type it will be treated as a PET (Bare Trust) or CLT (Discretionary Trust) |
If adding a Discounted Gift Trust onto the software and it is an existing investment, the 'Year Purchased' must be prior to the current year.
Other Trusts
When entering Other Trusts the whole value of the Trust will be treated as outside of the estate. Though note, Voyant does not currently model tax within or coming out of the trust.
You will need to set up a Transfer if money is going into the trust in the current year or a future year of the plan. This will be treated as a PET or CLT depending on if Bare Trust or Discretionary Trust is selected respectively.
Finally, you could look at the Potential IHT Insight to compare a plan with a trust to one without.
Guide here: Potential IHT Insight - UK
Look at the differences to the IHT value and the Net Worth After Tax in Legacy - Comparison View -Detailed view
In terms of moving money into an 'Other Trust' please note below:
|
Other Trusts |
||
|
Transfer into Trust more than 7 years before start of Voyant plan |
Transfer into trust within previous 7 years |
Transfer into Trust in Start year or any other future year in Voyant |
|
Enter as current Balance - nothing else needed |
Enter Balance. Fill in Previous PETs or CLTs by going to Carryover Assumptions - Previous Potentially Exempt Transfers or Chargeable Lifetime Transfers |
Set Balance as £0 and enter as a Transfer. Depending on the Trust type it will be treated as a PET (Bare Trust) or CLT (Discretionary Trust) |