A will trust is a legal arrangement created within a person’s will that comes into effect when they die. If the will you are dealing with contains a trust, probate remains necessary, but the process involves additional steps. This article explains what a will trust is, the most common types, and how a trust affects the probate process.
What is a will trust?
A will trust places certain assets in the hands of appointed “trustees” rather than passing them directly to beneficiaries. The person making the will (the testator) sets out instructions for how those assets should be managed and distributed. Trustees must follow those instructions for the benefit of the “beneficiaries” named in the trust.
This structure is useful in several situations:
- when you want to provide for someone without giving them immediate access to a large sum
- when assets need protecting for children or vulnerable adults
- when family circumstances are complex, for example after a second marriage
After probate is granted, the executors transfer the relevant assets into the trust. Only then do the trustees manage and distribute those assets according to the will’s instructions.
Types of will trust you may encounter
Will trusts take several forms. Each serves a different purpose. Below are the most common types you might find in a will.
Discretionary trusts
These give trustees broad discretion over how and when to distribute assets among a group of potential beneficiaries. The will may name several people (grandchildren, nieces or nephews, for example), but the trustees decide who receives what and when. This flexibility is valuable when beneficiaries’ circumstances may change over time due to marriage, financial hardship or disability.
Find out more: What is a Discretionary Trust?
Life interest trusts
These allow one person (the “life tenant”) to benefit from trust assets during their lifetime, usually through income or use of a property. After the life tenant dies, the capital passes to another named beneficiary. A common example is a surviving spouse who may live in the family home or receive rental income, with the property ultimately passing to children from a previous marriage.
Find out more: What is a Life Interest Trust?
Bare trusts
A bare trust is the simplest form of will trust. Trustees hold and manage assets until a beneficiary is legally old enough to take ownership. Parents often use bare trusts to hold funds for children until they reach 18, at which point the beneficiary becomes absolutely entitled to the assets.
The age in the clause matters. A gift “to X at 18”, where the interest vests immediately and only payment is postponed, is a bare trust. A gift “to such of my children as attain 21” is a contingent interest and is not a bare trust at all, because nothing vests until the condition is met. An age contingency above 18 under a parent’s will normally creates an 18-to-25 trust under section 71D of the Inheritance Tax Act 1984, with quite different tax consequences.
Find out more: What is a Bare Trust?
Property protection trusts
A property protection trust, sometimes loosely called a protective property trust, protects a share of the family home from being used entirely to meet care home costs. The two names are worth keeping apart: a “protective trust” is a different legal creature under section 33 of the Trustee Act 1925, being a life interest that fails on bankruptcy and converts into a discretionary trust. Typically, the property is owned jointly, and when one partner dies, their share passes into the trust. The surviving partner retains the right to live in the property, but does not own the deceased’s share outright. When both partners have died, the trust ends and that share passes to the chosen beneficiaries.
Find out more: What is a Property Protection Trust?
Nil rate band trusts
These trusts were designed to make full use of the inheritance tax nil rate band, the amount each person can pass on free of inheritance tax. Before the transferable nil rate band came into force in 2007, spouses and civil partners could not pass any unused allowance to each other. As a result, many wills included a nil rate band trust to use the first partner’s tax-free threshold in full.
Since October 2007, the unused proportion of a deceased spouse’s or civil partner’s allowance can transfer to the surviving partner’s estate. For 2026/27, the standard nil rate band is £325,000 per person, giving qualifying couples a combined threshold of up to £650,000. Nil rate band trusts are therefore far less common in new wills, though they still appear in older ones and may need careful consideration.
Two points about the transfer are worth being precise on, because they are widely misstated. It is not automatic: the executors have to claim it, on form IHT402 alongside an IHT400 or on the probate application itself for an excepted estate, within two years of the end of the month in which the second person died. And the qualifying date works by reference to the survivor’s death, not the first: the transfer is available where the survivor died on or after 9 October 2007, whenever the first spouse died.
How a will trust affects the probate process
Probate is still required even when a will contains a trust. The executors apply for a grant of probate, which gives them the legal authority to administer the estate. Once probate is granted, they collect the assets, settle any debts and tax liabilities, and begin distribution.
Where a will trust is involved, the executors also need to transfer the relevant assets into the trust. In practice, this could mean:
- transferring property ownership into the names of the trustees
- moving funds into a separate trust bank account
- ensuring the trust is properly registered with HMRC where required (see below)
In many cases, the same people act as both executors and trustees. The executors’ role ends once the estate is settled. The trustees’ responsibilities continue for as long as the trust remains in force, which can be many years.
Will trust registration: the current rules
Most will trusts must register with HMRC through the Trust Registration Service (TRS) unless an exemption applies. The TRS is the online service through which trustees provide details of the trust, its assets, settlor, trustees and beneficiaries.
Will trusts created on death benefit from a two-year grace period before registration becomes necessary. If the trust is wound up and all assets distributed within two years of the date of death, registration is not required at all. If it continues beyond two years, the trustees have 90 days from the two-year anniversary of the death to register.
Two conditions are easy to trip over. The exclusion only holds while the trust contains nothing but property from the estate, so adding outside assets breaks it. And a UK tax liability arising during the two years makes the trust registrable as a taxable trust regardless.
From 30 June 2026, the Money Laundering and Terrorist Financing (Amendment) Regulations 2026 updated the TRS rules. The two-year post-death grace period now extends to a wider range of trusts arising on death, including trusts created by deed of variation and certain co-ownership trusts. A new de minimis exclusion also applies to very small non-taxable trusts, and its conditions are more specific than most summaries suggest. The trust must hold no interest in UK land; hold no “assets of appreciable worth” exceeding £2,000 in total, which HMRC defines as non-financial assets capable of rising in value, such as works of art, antiques, collectibles and jewellery; never have held property with a cumulative value exceeding £10,000 since it was created; have income of no more than £5,000 a year; and have no UK tax liability. The £10,000 is a cumulative test measured since the trust was created, not a snapshot of what it holds now. A settlor may also only have one trust excluded under this rule.
Trustees should not assume that existing arrangements remain unaffected by these changes. Review registration obligations carefully, and take professional advice if in any doubt.
Tax obligations for will trusts
Trusts have their own tax responsibilities, separate from the estate. These can include:
- Income tax on income generated by the trust (for example, rent or interest)
- Capital gains tax if trust assets are sold at a gain
- Inheritance tax, depending on the structure and value of the trust
Discretionary trusts, for example, are generally subject to a ten-year periodic charge and exit charges when assets leave the trust. The maximum rate of the ten-year charge is 6 per cent, and in practice the effective rate is usually lower. Trustees must keep tax affairs up to date throughout the life of the trust. Professional advice at the outset can prevent costly mistakes.
Need help with probate or a will trust?
The Probate Network connects you with experienced professionals who can guide you through every stage of the probate process, including where the will contains a trust. Whether you are an executor, a trustee or a family member trying to understand the next steps, we can help you find the right support. Request a quote and find the right professional for your situation.
You may also find these articles useful:
- What is a Trustee in a Will
- What is a Discretionary Trust
- What is a Life Interest Trust
- What is a Bare Trust
- What is a Property Protection Trust
- When Property is Left in a Trust in a Will
Frequently asked questions
Does a will trust avoid probate?
No. Probate is still required when a will contains a trust. The grant of probate gives the executors legal authority to administer the estate, including transferring the relevant assets into the trust. The trust itself only begins operating once those assets are transferred.
Do will trustees have to register with HMRC?
In most cases, yes. Will trusts must register with HMRC through the Trust Registration Service if they continue for more than two years after the date of death, with 90 days to register from that two-year anniversary. If the trust is wound up and all assets distributed within those two years, registration is not required. The grace period ends early if the trust takes in property from outside the estate or incurs a UK tax liability. Trustees with any doubt should take professional advice, particularly in light of the rule changes that took effect on 30 June 2026.
Can the same person be both an executor and a trustee?
Yes, this is common and entirely permitted. Many wills appoint the same individual to act in both roles. As executor, they administer and settle the estate. As trustee, they then manage the trust assets according to the will’s instructions. The two roles carry different legal duties, so it is worth understanding the distinction before accepting either appointment.
Are nil rate band trusts still worth including in a will?
For most couples and civil partners, nil rate band trusts are no longer necessary. Since October 2007, the transferable nil rate band has allowed the unused allowance from a first death to pass to the surviving partner’s estate. For 2026/27, that means a combined threshold of up to £650,000, though the transfer has to be claimed by the executors rather than applying automatically. However, nil rate band trusts still appear in older wills and some couples may still choose to include a discretionary will trust on first death for other planning reasons. A solicitor can advise on whether an existing trust remains appropriate for your circumstances.
This article is for general guidance only and does not constitute legal, tax or financial advice. Rules and thresholds can change and every estate is different. For advice on your own circumstances, speak to a qualified professional. You can book a free legal consultation through The Probate Network.
