Should I Consider Setting Up a Trust? Which Type?

Updated: Oct 12

Before we start, it must be highlighted that this blog entry is only relevant to common law countries (i.e. England, USA, Australia, New Zealand, etc.) and to countries which recognize the legal institution of trusts.

If you are hard at work planning for the future of your estate, you might be trying to decide between a Will and a trust, and to make your decision harder, you could find yourself at a crossroads regarding whether your trust should be revocable or irrevocable. While each instrument is essentially designed to ultimately do the same thing – leave your assets to a party you trust – a couple of differences are inherent to each.

What is an Irrevocable Trust? 
What is a Revocable Trust?
Decide Which is Right for You

What is an Irrevocable Trust?

An irrevocable trust is one that the settlor of the trust (you) cannot revoke or take back, in whole or in part. It can only be modified or terminated with the permission of the beneficiary. You give up your right to access or ownership over its contents when you transfer assets into a trust, as such, once you set up an irrevocable trust, it is no longer considered part of your estate for tax or legal purposes.


While it may seem a little terrifying to move your assets into a trust you cannot touch, the point of an irrevocable trust is to ensure that the assets in trust are not considered ‘yours’ for tax purposes. It additionally removes any liability from your estate.

What is a Revocable Trust?

A revocable trust lets you have access to its contents at any time. You can also change or modify its terms to your liking without the beneficiary’s permission. Because this type of trust is still considered to be part of your estate, it will be considered as such for tax and legal purposes.


Decide Which is Right for You

A revocable trust might be enough for you if you want to avoid your beneficiaries a lengthy and open probate procedure. However, an irrevocable trust might be a better option if you wish to reduce estate taxes. As trusts can be complicated to create because they protect your most important assets, you want to make sure that they are done correctly. Do seek appropriate guidance to discuss the specifics of your situation.

Irrespective of the type of trust you consider setting up, writing your Will is the very first step, and it’s an important one. But that’s not enough. In the digital age, the next step is to store your Will online. Otherwise, what happens if nobody is able to find your Will in a timely manner? liteWill is the only registration platform that is available globally and that provides the option to store your Will online. ‘A Will that is not online is like a Will that does not exist’.


This portion of the website is for information only. The statements and opinions are the expression of their author, not of liteWill, and have not been evaluated for accuracy, completeness or changes in the law. Information contained in this article is not a substitute for tax or legal advice.

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