Life Interest Trust Solicitors in Leeds | Protect Your Family’s Inheritance

At Winston Solicitors in Leeds, we’ve helped thousands of families protect their homes and inheritance. With over 3,000 five-star reviews, our clients trust us to give clear, practical advice about life interest trusts. These are also known as interest in possession trusts or IPDIs.

A life interest trust is a special type of Will trust. It allows you to leave your share of property (or other assets) in trust so that your partner can use or live in it for the rest of their life. After they die, your children or chosen beneficiaries inherit your share. This way, your partner is looked after, but your children’s inheritance is also secured. Our expert life interest trust solicitors in Leeds can help to explain and clarify further.

Many people in Leeds and West Yorkshire choose a life interest trust if they want to:

• Let a partner stay in the family home after their death
• Protect children’s inheritance from a new marriage or relationship
• Reduce the risk of losing everything to care fees
• Make sure blended families are treated fairly
• Plan ahead for inheritance tax with clear rules

We know that trust law and tax rules can feel overwhelming. That’s why we explain everything in plain English, with clear costs from the start. You’ll have local solicitors guiding you step by step, so you can make confident decisions about your family’s future.

Take the first step today. Call our life interest trust solicitors in Leeds, or request a callback to discuss setting up your life interest trust.

A life interest trust (sometimes called an interest in possession trust or IPDI) is a clause you put in your will. It sets aside your share of property, savings or investments for a loved one to use during their lifetime.

That person is called the life tenant. They can live in the home, receive rental income, or use other assets placed in the trust. They don’t own the assets outright and when they die, those assets pass to the ultimate beneficiaries you’ve chosen, often your children.

In simple terms, a life interest trust lets you:

• Care for your partner while they are alive
• Guarantee your children inherit later
• Keep control over what happens to your share of property

This type of trust is common in Leeds and across West Yorkshire for people who:

• Own a family home with a partner
• Have children from a previous relationship
• Want to balance security for a spouse with fairness for children

A life interest trust can give you peace of mind, knowing your partner is looked after, while your children’s inheritance is protected.

Setting up a life interest trust is straightforward with the right advice. Here’s how the process usually works:

1. Write your Will
   • Your solicitor includes a life interest trust clause.
   • You choose who the trust will benefit now (life tenant) and in the future (ultimate beneficiaries).
2. Decide how the property is owned
   • To place your share of a home into trust, you must own it in your sole name or as tenants in common.
   • If you currently own as joint tenants, this will need to be changed
3. Appoint trustees
   • Trustees manage the trust after you pass away.
   • They ensure the life tenant can live in, or benefit from, the property, while protecting the rights of the ultimate beneficiaries.
4. Life tenant enjoys the benefit
   • The life tenant can live in the home for life or receive income from it if rented out.
   • They must keep the property in good repair and may need to cover ongoing costs.
   • If the life tenant moves into a care home, only their share of the property (not the deceased's) is counted towards their financial assessment by the local authority to see if they have to pay for their care.
     • The property would then often be sold, with the trust getting its share of the proceeds and the life tenant getting theirs.
   • If the life tenant wants to downsize, this is also possible with a life interest trust.
5. Trust ends and assets pass on
   • The trust usually ends when the life tenant dies
   • At that point, the property or funds go directly to the ultimate beneficiaries you've named in your will.

This step-by-step approach means you can support your partner today while protecting your children's inheritance for tomorrow.

Your ability to use a life interest trust depends on how you own your home.

• Joint tenants – If one owner dies, the survivor automatically becomes the sole owner, no matter what the Will says. This setup does not allow for a life interest trust.
• Tenants in common – Each owner has a clear share of the property. You can leave your share in a life interest trust through your Will.

If you currently own your property as joint tenants, your solicitor can help you sever the joint tenancy and switch to tenants in common. This small legal step makes it possible to protect your share of the home for your children, while still giving your partner the right to live there for life.

Many homeowners in West Yorkshire choose this route to:

• Make sure their children inherit part of the family home
• Prevent the property from being fully absorbed by care home fees
• Balance fairness between a current partner and children from a previous relationship

One of the most common questions we hear in Leeds is: “How does a life interest trust affect inheritance tax?” Here’s the simple version.

• On the first death – If the life tenant is a spouse or civil partner, the spouse exemption applies. This usually means no inheritance tax at that stage.
• While the trust is running – The life tenant is treated by HMRC as if they own the trust asset. If they receive income (for example, rent from the property), they are taxed on it in the normal way.
• When the life tenant dies – The life interest trust should not affect their eligibility for NRBs.
• Nil Rate Band (NRB) – Every estate gets £325,000 tax-free.
• Residence Nil Rate Band (RNRB) – If you leave your family home to your direct descendants, you can claim an extra £175,000 allowance.
• Transfers between spouses – Allowances can be combined, so in some cases a married couple/civil partners can pass on up to £1 million to their children before tax is due.

Important Note: If a life interest trust is ended early (for example, by selling a property and distributing the money), it may be treated as a gift. This can reduce the life tenant’s NRB if they die within seven years.

Our solicitors in Leeds explain these rules in plain English and give you practical examples, so you’ll always know where you stand.

We know one of the first things people want to know is: “How much does a life interest trust cost?”

At Winston Solicitors in Leeds, we believe in clear pricing with no surprises. While costs depend on the complexity of your will and property arrangements, most life interest trusts can be set up for a small fixed fee.

What you get with our service:

• A tailored Will including a life interest trust
• Property ownership advice (joint tenants vs tenants in common)
• Appointment of trustees and executors
• Plain-English guidance on tax and care fee rules
• Secure digital and paper copies of your documents

Typical timescale:

• Initial call within 48 hours of enquiry, leading to a meeting to take your  instructions
• Draft documents ready within 2 weeks of the meeting
• Signing and finalising within 2–4 weeks depending on complexity and updating the Land Registry about severing the joint tenancy

Get in touch with our life interest trusts solicitors for a fixed-fee quote

A life interest trust is designed to last for the lifetime of the life tenant. But there are clear points when it can end:

• Death of the life tenant – This is the most common trigger. The trust then passes the assets (often the family home) to the ultimate beneficiaries named in the will.
• Early termination – Sometimes, a trust can end while the life tenant is still alive. This might happen if the property is sold and the proceeds are split, or if the life tenant gives up their right to live there.
• Other conditions in the Will – Some wills include clauses that end the trust if the life tenant remarries, cohabits, or stops living in the property.

What happens when the life tenant dies?

When the life tenant passes away:

• The trustees transfer the trust assets to the ultimate beneficiaries.
• If inheritance tax is due, it is assessed as part of the life tenant’s estate.
• Any outstanding property or legal arrangements are dealt with before distribution.

Can a life interest trust be terminated early?

Yes, but only in certain cases and usually with the agreement of both the life tenant and the beneficiaries. This can have inheritance tax implications, so legal advice is essential before making changes.

If you’re dealing with a life tenant’s death or need advice on ending a trust, our Leeds solicitors can guide you through every step.

When planning your Will, you may hear about discretionary trusts as well as life interest trusts. Both can protect your assets, but they work in different ways.

Life Interest Trust

• Gives one person (the life tenant) the right to use or live in the property for life.
• Provides certainty: the ultimate beneficiaries are clearly named.
• Useful for protecting children’s inheritance while caring for a partner.
• Limitation: less flexible if family circumstances change.

Discretionary Trust

• Trustees decide who benefits and when, from a pool of potential beneficiaries.
• Offers flexibility to respond to changing needs (e.g. children, grandchildren, tax planning).
• Can help if a beneficiary has money management issues or may lose means-tested benefits.
• Limitation: beneficiaries have no guaranteed right to the assets.

Which is right for you?

• Life interest trusts work best if you want a balance between security for your partner and certainty for your children.
• Discretionary trusts are better where flexibility is more important than certainty.

Our Life Interest Trust solicitors can explain which option suits your family and draft a will that reflects your wishes.

Life interest trusts are powerful tools, but there are some misunderstandings and limitations to be aware of.

Myth: A life interest trust always avoids care home fees

While a trust may protect part of the property from being counted in a local authority assessment, it is not a guaranteed way to avoid care fees. For instance, if a married couple have a LIT but both go into care, then the house must be sold and split between them to fund their care.

Disadvantages to consider

• The life tenant has a duty to keep the property in good repair, which can be costly.
• The trust may limit flexibility if family circumstances change.
• If the trust is ended early, there could be inheritance tax consequences.
• Setting up the trust requires careful legal drafting. DIY Wills often miss vital clauses.

The key is balance. Our Leeds solicitors will explain the risks in plain English and guide you to the right trust for your family.

At Winston Solicitors, we combine local knowledge with a national reputation for clear and caring legal advice. Based in Leeds and serving families across West Yorkshire, we’re proud to have earned over 3,000 five-star reviews.

When you come to us, you’ll get:

• Specialist Wills and life interest trusts solicitor with years of experience
• Straightforward, friendly advice in plain English
• Transparent fixed fees, so you know where you stand
• The reassurance of a trusted local firm, with national recognition

Protect your home, your partner and your children’s future. Speak with our Leeds solicitors today to get started.

A life interest trust could be the right way to protect your home, care for your partner and secure your children’s inheritance. Our life interest trust solicitors make the process simple, clear and affordable.

Start your life interest trust today. Call our friendly team in Leeds or request a callback.