Bereaved minor trusts
If a will leaves a gift to minor children or stepchildren conditional upon them attaining the age of 18 years this will create a bereaved minor trust. A bereaved minor trust can only be created by parents and step-parents for their own children/stepchildren. Grandparents and other relations who leave money to minor children will not create a bereaved minor trust but instead will either create a bare trust or relevant property trust (taxable in the same way as discretionary trusts).
Bereaved minor trusts differ from other trusts in the way they are treated for inheritance tax purposes. They have special treatment providing that the bereaved minor becomes absolutely entitled to the trust fund on or before his or her 18th birthday. The trust can also be created under the intestacy rules.
For anything further, one of our specialists would be delighted to meet you either in our office or in your own home to talk through your requirements and answer any questions. Please contact us at any time.