RNRB- flexible life interest

Trusts Discussion
1

My clients wish to create a flexible life interest trust into which their respective share of the family home will pass. The surviving spouse is the life tenant and their children/grandchildren are the remaindermen. In the event of the family home being sold, they want the surviving spouse to be entitled to both income and capital from the sale proceeds.

My initial thoughts are that two trust arrangements will be required in the will: the first dealing with the life interest over the property and the second giving the trustees powers of advancement dealing with the capital being paid to the life tenant.

On that basis, would the requirements for the RNRB be met?

Katie Kenealy
RDP Law

2

It can be a life interest for the survivor until the earliest of a sale-in which case it determines in favour the of the survivor-or death-with issue taking.

It will be a disaster from the point of view of nursing home fees, as there will be no protection in the event of a sale-so perhaps make it conventional, with no “entitlement” for the survivor on sale, but power to advance.

The overriding powers must determine on the survivors death if you want to claim the RNRB on the second death in relation to the half share in the trust, and the remaindermen must take absolutely with no age contingency.

Simon Northcott