What Happens to a Trust After Divorce in the UK?

Divorce is complex and emotionally challenging, especially when trusts are involved. In England and Wales, what happens to a trust after divorce depends on several key factors — including the type of trust, when it was established, the terms of the trust deed, and the specific circumstances of the divorce itself.

Understanding how divorce affects trusts is essential, particularly if you or your family have set up trusts to protect assets for future generations. With the UK divorce rate sitting at around 42%, this is a scenario more families face than you might expect. We’ll explore how trusts interact with divorce proceedings, what the courts can and cannot do with trust assets, and how proper planning can make all the difference.

By examining the legal and financial dimensions of trusts and divorce under English law, we aim to give you a clear, practical understanding of what happens to trust assets when a marriage breaks down — and how to protect your family’s wealth.

Key Takeaways

• Divorce can impact the status and distribution of a trust, but trust assets are not automatically divided between spouses.
• The type of trust — particularly whether it is a discretionary trust or a bare trust — plays a critical role in determining how the court treats it.
• Properly structured discretionary trusts offer significantly more protection than bare trusts, because no beneficiary has an automatic right to income or capital.
• The courts have wide-ranging powers under the Matrimonial Causes Act 1973 to consider trust assets as a financial “resource” available to a party.
• Seeking specialist legal advice from both a family law solicitor and a trust law specialist is essential for navigating these complexities.

Understanding Trusts in the Context of Divorce

Divorce and trusts are complex topics that require careful analysis under English and Welsh law. Before we look at how divorce affects trusts, it’s important to understand exactly what a trust is and how different trust types behave.

Definition of a Trust

A trust is a legal arrangement — not a legal entity — under which one person (the settlor) transfers assets to another person or persons (the trustees), who hold and manage those assets for the benefit of specified people (the beneficiaries). The trustees become the legal owners of the assets, but they must manage them according to the terms set out in the trust deed.

England invented trust law over 800 years ago, and it remains one of the most powerful tools in asset protection and estate planning. Crucially, because a trust has no separate legal personality, the trustees are personally responsible for its proper administration — they hold legal title to the trust assets and owe fiduciary duties to the beneficiaries.

Key characteristics of a trust include:

• Assets are held separately from the settlor’s personal estate — legal ownership transfers to the trustees.
• Trustees have a fiduciary duty to manage the trust assets in the best interests of the beneficiaries.
• In a discretionary trust, no beneficiary has any automatic right to income or capital — the trustees decide who receives what, when, and how much.

Types of Trusts Relevant to Divorce

There are several trust types that commonly arise in divorce proceedings. In the UK, the primary classification is whether a trust is a lifetime trust (created during the settlor’s lifetime) or a will trust (taking effect on death), and the secondary classification is how it operates — discretionary, bare, or interest in possession:

• Discretionary Trusts: The most common type used in estate planning (around 98–99% of trusts). Trustees have absolute discretion over distributions. No beneficiary has a fixed entitlement, which makes these trusts significantly harder for a divorcing spouse to claim against. They can last up to 125 years under English law.
• Interest in Possession Trusts (Life Interest Trusts): A named beneficiary (the life tenant) receives income or use of the trust assets during their lifetime. The capital passes to the remainderman when the life interest ends. These are common in will trusts designed to prevent sideways disinheritance in second marriages.
• Bare Trusts: The beneficiary has an absolute right to the trust capital and income once they reach 18 (under the principle in Saunders v Vautier). Bare trusts offer very little protection in divorce because the beneficiary’s entitlement is fixed and can be easily identified by the court.
• Nuptial Trusts: Trusts created in connection with a marriage (ante-nuptial or post-nuptial settlements). The court has specific powers under the Matrimonial Causes Act 1973 to vary these trusts on divorce.

Understanding the distinction between these trust types is vital in divorce. As Mike Pugh often explains: when someone asks your child in a divorce, “What assets do you have?” — if their home is in a properly structured discretionary trust, the answer is simple: “What house? I don’t own a house.” That’s the power of a well-drafted trust.

The Implications of Divorce on Trusts

When a marriage ends in divorce, it can significantly affect trusts connected to either spouse. This impacts not just the couple, but also other beneficiaries and the trustees themselves. The court’s approach to trusts during financial remedy proceedings is a critical factor in how assets are ultimately divided.

Generally Accepted Views

It is widely accepted that trusts are not completely immune from scrutiny in divorce proceedings. English family courts have broad powers to look behind trust structures. However, the level of protection a trust offers depends heavily on how it was set up. A discretionary trust where the divorcing spouse is merely one of a class of potential beneficiaries — with no automatic entitlement — is far harder for the court to treat as a matrimonial resource than a bare trust where the spouse has an absolute right to the assets.

The court will examine the trust deed, the history of distributions, the identity and role of the trustees, and the degree of control either spouse has over the trust. If a trust was set up by a third party (such as a parent) long before the marriage, and the spouse has received no distributions, the court is less likely to treat it as available wealth. Conversely, if one spouse set up the trust themselves using matrimonial assets, the court will scrutinise this much more carefully.

Legal Framework Surrounding Trusts

The Matrimonial Causes Act 1973 gives the court wide powers to redistribute assets in divorce proceedings. Under this Act, the court can consider trust assets as a “financial resource” available to either party when determining how to achieve a fair financial settlement.

Specifically, the court has the power to vary any “ante-nuptial or post-nuptial settlement” made on the parties to the marriage. This is a powerful provision — the courts have interpreted “nuptial settlement” broadly, and trusts that were created during the marriage, or that one spouse benefits from, may fall within this definition.

However, the court cannot simply ignore the trust deed or force independent third-party trustees to hand over assets. With a properly structured discretionary trust — where no beneficiary has any automatic entitlement — the court faces significant limitations. The trustees’ discretion acts as a genuine barrier. This is precisely why the type of trust matters so much in divorce protection, and why a discretionary trust offers far superior protection compared to a bare trust or an interest in possession trust where the spouse has a fixed entitlement.

Understanding how divorce affects trusts is crucial for both trustees and beneficiaries. It underscores the need for specialist advice — from both a family law solicitor and a trust law specialist — to navigate these complex interactions effectively.

How Divorce Affects Discretionary Trusts

Divorce can have wide-ranging effects on discretionary trusts. However, because of how discretionary trusts operate under English law, they offer a level of protection that other trust types simply cannot match. The critical factor is that no beneficiary has an automatic right to income or capital — everything depends on the trustees’ discretion.

Impact on Beneficiaries

Divorce can affect beneficiaries of discretionary trusts, but the impact is significantly muted compared to other trust types. Because a beneficiary of a discretionary trust has no more than a “hope” (sometimes called a mere expectancy) of receiving anything, there is no fixed asset for the divorcing spouse to claim against.

The court may still treat the trust as a financial “resource” if it appears likely that the trustees would make distributions to the beneficiary in question. The court will examine past distribution patterns, the relationship between the beneficiary and the trustees, and whether the beneficiary has any influence over the trustees’ decisions. However, where the trustees are genuinely independent and have exercised their discretion properly, the protection is strong.

This is fundamentally different from a bare trust, where the beneficiary has an absolute right to the capital at age 18. In a bare trust, the divorcing spouse’s entitlement is clear and quantifiable — offering virtually no divorce protection at all.

Trustee Responsibilities Post-Divorce

Trustees of a discretionary trust must continue to act in the best interests of all beneficiaries — not just the divorcing spouse. After a divorce, trustees face additional considerations, but their fundamental fiduciary duties remain unchanged.

Key considerations for trustees include:

• Assessing whether making distributions to a beneficiary going through divorce could inadvertently benefit the ex-spouse or be treated as a matrimonial resource.
• Reviewing the class of beneficiaries and considering whether the letter of wishes needs updating to reflect the changed family circumstances.
• Taking independent legal advice before making significant distribution decisions during or after divorce proceedings.
• Documenting their reasoning carefully — showing that decisions are made in the interests of all beneficiaries, not influenced by the divorce of one.

By carefully managing these responsibilities, trustees can fulfil their duties while maintaining the trust’s protective function — which is precisely why the trust was established in the first place.

The Role of Prenuptial Agreements

Prenuptial agreements play an increasingly important role in protecting trust assets during divorce. While they work alongside trusts rather than replacing them, a well-drafted prenuptial agreement can significantly strengthen the protection of family wealth held in trust.

Protecting Trust Assets

A prenuptial agreement can explicitly acknowledge that certain assets are held in trust and are not matrimonial property. By both parties agreeing before the marriage that trust assets should be excluded from any future financial settlement, the agreement creates an additional layer of protection alongside the trust structure itself.

This is particularly valuable where parents have placed the family home or other significant assets into a discretionary trust for their children’s benefit. A prenuptial agreement signed by the child and their future spouse, confirming that neither has a claim on trust assets, can be a powerful supporting document if the marriage later breaks down.

Enforceability of Prenuptial Terms

In England and Wales, prenuptial agreements are not automatically legally binding — unlike in many other jurisdictions. However, following the landmark Supreme Court decision in Radmacher v Granatino [2010], the courts give significant weight to prenuptial agreements provided certain conditions are met:

• Both parties received independent legal advice before signing.
• There was full financial disclosure from both sides.
• The agreement was signed freely, without undue pressure or duress.
• The agreement was made at least 21–28 days before the wedding (as a guideline).
• The terms are broadly fair and do not leave one party in a situation of real need.

A well-drafted prenuptial agreement that meets these criteria will carry substantial weight with the court. Combined with a properly structured discretionary trust, the two together provide a robust defence against claims on family assets during divorce — far stronger than either measure alone.

Understanding the interplay between prenuptial agreements and trusts helps families plan, don’t panic — and take proactive steps to protect their wealth before problems arise.

Trusts and Financial Settlements

Understanding how trusts fit into divorce financial settlements is essential. In England and Wales, the court’s overriding objective in financial remedy proceedings is to achieve fairness — and trusts are considered as part of the overall financial picture.

We’ll examine how the court assesses the contribution trust assets make to the matrimonial pot, and how trust interests are valued.

Asset Contribution Considerations

When the court examines trust assets in divorce proceedings, it considers a range of factors to determine whether and how those assets should be taken into account. The court’s approach differs significantly depending on the trust type.

Key factors the court considers include:

• The source of the trust assets — were they pre-marital wealth, inherited, or generated during the marriage?
• Whether distributions from the trust have been used to support the family’s lifestyle during the marriage.
• The degree of control the divorcing spouse has (or appears to have) over the trustees.
• Whether the trust is a nuptial settlement that the court can vary, or a third-party trust created by someone else entirely (such as a parent or grandparent).

A discretionary trust created by a parent to protect the family home offers far more protection than a trust the spouse created themselves using matrimonial funds. The court distinguishes between these scenarios carefully.

Valuation of Trust Interests

Valuing a trust interest in divorce proceedings is inherently complex, particularly with discretionary trusts. Because no beneficiary has a fixed entitlement in a discretionary trust, there is no straightforward way to put a price on their “interest” — it’s a hope, not a right.

The court may consider:

• The current market value of the trust assets (such as a property or investment portfolio).
• The nature of the beneficiary’s interest — is it a bare trust entitlement (absolute right) or a discretionary trust interest (mere hope)?
• The likelihood of future distributions based on past patterns and the letter of wishes.
• Whether there are competing beneficiaries whose interests must also be considered.

In practice, dealing with trusts in divorce financial settlements is one of the most complex areas of family law. A properly structured discretionary trust — where the trustees are genuinely independent and exercise real discretion — presents a significantly harder target than assets held in the divorcing spouse’s own name. This is one of the core reasons families choose to protect their home and other assets through a trust arrangement.

Seeking Legal Advice Post-Divorce

When divorce intersects with trusts, obtaining expert legal advice is essential to protecting your interests and those of other beneficiaries. The legal landscape of trust administration after a divorce is complex and requires specialist knowledge in both family law and trust law — two distinct areas of legal practice.

Importance of Professional Guidance

Getting professional legal guidance is crucial for dealing with post-divorce trust administration. As Mike Pugh often says, the law — like medicine — is broad. You wouldn’t want your GP doing surgery. Similarly, you need a specialist, not a generalist, when trusts and divorce collide.

A specialist solicitor can explain how the divorce affects the trust structure, whether the trust deed needs updating, and what the trustees’ obligations are going forward. They can also advise on whether any court orders made during the divorce proceedings affect the trust, and how to comply with those orders while still protecting the interests of all beneficiaries.

Choosing the Right Solicitor

Finding a solicitor with expertise in both trust law and family law is essential. Here are the key things to look for:

• Specific experience handling trust assets in divorce proceedings — not just general family law or general trust administration.
• A thorough understanding of English and Welsh trust law, including how different trust types (discretionary, bare, interest in possession) are treated in financial remedy proceedings.
• The ability to explain complex legal concepts in plain English — if your solicitor can’t explain something clearly, they may not fully understand it themselves.
• Willingness to work alongside a trust law specialist if needed, ensuring both the family law and trust law angles are properly covered.

Choosing a solicitor with the right dual expertise can make the difference between trust assets being protected or being drawn into the matrimonial settlement. This specialist advice is crucial for dealing with trust issues after a divorce, giving you confidence and financial security going forward.

Modifications to Trusts After Divorce

Modifying a trust after divorce is a process that requires careful analysis of the trust deed, the settlor’s original intentions, and the changed family circumstances. Divorce often reshapes the relationships between beneficiaries, which may necessitate updating the trust’s terms or the letter of wishes.

When and How Changes Can Be Made

Whether and how a trust can be modified depends on what powers are contained within the trust deed. Well-drafted discretionary trusts — such as those created by MP Estate Planning — include “Standard and Overriding Powers” that give trustees defined powers to make changes without making the trust revocable. These powers might include the ability to add or exclude beneficiaries, change the distribution terms, or appoint new trustees.

Common scenarios where trust modification may be needed after divorce include:

• Removing an ex-spouse from the class of beneficiaries (if the trust deed permits this).
• Updating the letter of wishes to reflect the settlor’s changed intentions regarding distributions.
• Replacing a trustee who was the divorcing spouse or their family member.
• In some cases, a court order under the Matrimonial Causes Act 1973 may require specific changes to a nuptial settlement.

Any changes must comply with both the trust deed and UK law. Depending on the circumstances, changes may require the agreement of all trustees, the consent of specific beneficiaries, or — in more complex cases — an application to the court.

Notifying the Trustees

Keeping trustees fully informed about any divorce proceedings involving a beneficiary is a critical step. Trustees need to understand the situation so they can exercise their discretion properly and avoid inadvertently making distributions that benefit an ex-spouse or that could be seen by the court as a financial resource.

The table below outlines the key steps in the notification and modification process:

For more on updating estate plans after major life changes like divorce, see our guide on whether you need to update your estate plan in the UK.

Cases that Might Trigger Trust Distribution

Distributing trust assets during or after a divorce is a complex process governed by the trust deed, the trustees’ discretion, and — in some cases — court orders. Understanding the circumstances that can trigger distribution, and the relevant case law, is essential for both trustees and beneficiaries.

Circumstances Leading to Distribution

Several factors can lead to trust assets being distributed during or after divorce proceedings:

Court orders: If the court determines that a trust is a nuptial settlement, it has the power to vary the trust terms, which could include ordering distributions. However, with a third-party discretionary trust (one created by a parent, for example), the court’s powers are more limited.

Beneficiary needs: Trustees of discretionary trusts must consider all beneficiaries’ circumstances. If a beneficiary is going through divorce and faces genuine financial hardship, the trustees may decide to make a distribution — but they must balance this against the risk that the distribution could be treated as a matrimonial asset.

Trust deed provisions: Some trust deeds contain specific provisions about what happens on a beneficiary’s divorce, such as automatic exclusion of the divorcing spouse or restrictions on distributions during proceedings.

The trustees must consider the beneficiaries’ financial situations carefully, taking independent legal advice where necessary, before making any distribution decisions during or shortly after divorce proceedings.

Legal Precedents in the UK

Several landmark cases have shaped how English courts treat trusts in divorce:

In Charman v Charman [2007], the Court of Appeal considered the husband’s interest in a discretionary trust as part of the financial resources available to him. The court examined whether the trustees were likely to make distributions and treated the trust assets as part of the overall financial picture.

In Prest v Petrodel Resources Ltd [2013], the Supreme Court confirmed that the court cannot simply “pierce the corporate veil” or override the legal distinction between a company (or trust) and its beneficiaries. However, where assets were held on a bare trust basis for the husband, the court could declare his beneficial interest. This case reinforced the principle that the nature of the beneficial interest matters enormously — a fixed entitlement can be claimed far more easily than a discretionary interest.

In Whaley v Whaley [2011], the Court of Appeal considered an offshore discretionary trust and noted that the court should not simply assume trustees would comply with a divorcing spouse’s wishes. Where trustees exercised genuine, independent discretion, the trust assets were not automatically treated as available resources.

These cases collectively demonstrate that a properly structured discretionary trust — with genuinely independent trustees exercising real discretion — provides meaningful protection in divorce, although no structure can guarantee absolute immunity from the court’s broad powers.

Tax Implications on Trusts After Divorce

Understanding the tax consequences for trusts after a divorce is important for trustees, beneficiaries, and their advisers. When a marriage ends, the financial and tax landscape changes — and trusts are directly affected. Getting the tax treatment right is essential to avoid unexpected liabilities.

Inheritance Tax Considerations

Inheritance tax (IHT) is a significant consideration for trusts, both during and after divorce. In England and Wales, IHT is charged at 40% on the taxable estate above the nil rate band (currently £325,000 per person, frozen since 2009 and confirmed frozen until at least April 2031). The residence nil rate band (RNRB) of £175,000 per person may also be available where a qualifying residential interest passes to direct descendants — children, grandchildren, or step-children. Both the NRB and RNRB can transfer between spouses, giving a married couple a combined maximum of £1,000,000 (£650,000 NRB + £350,000 RNRB).

Key IHT considerations for trusts after divorce:

• If the trust is a discretionary trust (relevant property trust), it is subject to the relevant property regime: a potential entry charge of 20% on values above the nil rate band, periodic 10-year charges of up to 6%, and proportionate exit charges. For most family homes held in trust where the value is below the nil rate band, these charges are zero or negligible.
• If a court order varies a nuptial trust on divorce, this variation may have IHT consequences — particularly if assets are appointed out of the trust to one of the spouses.
• Transfers between spouses during marriage are exempt from IHT. Once the final order (formerly decree absolute) is granted, this inter-spouse exemption no longer applies. Timing of any trust distributions around the divorce can therefore be significant.
• If the trust structure needs to change post-divorce (for example, removing a beneficiary), this must be done carefully to avoid triggering unexpected IHT charges.
• The ongoing NRB freeze since 2009 means more ordinary families — particularly homeowners, with the average home in England now worth around £290,000 — are being caught by IHT. This makes proper trust planning even more important.

Other Tax Liabilities

Beyond IHT, trusts are subject to income tax and capital gains tax (CGT), and divorce can alter the tax position.

Income Tax: Trusts pay income tax at the trust rate — currently 45% on non-dividend income and 39.35% on dividend income (with the first £1,000 of income taxed at the basic rate). After divorce, if the pattern of distributions from the trust changes, the income tax position may also change. Trustees must file an annual SA900 trust tax return with HMRC.

Capital Gains Tax: CGT applies when trust assets are disposed of or transferred out of the trust. The rates are currently 24% for residential property and 20% for other assets. Trusts receive a reduced annual exempt amount — currently half the individual level, which is £1,500. Importantly, holdover relief may be available when assets are transferred into or out of certain trusts, deferring any immediate CGT charge.

During the tax year of separation, transfers between spouses can still benefit from the “no gain, no loss” treatment for CGT purposes. Once they are no longer treated as connected persons — which happens at the end of the tax year of separation (or, if living apart, at the date of permanent separation) — this relief is lost. Any restructuring of trust assets should therefore be carefully timed around these milestones.

Trustees and beneficiaries should seek specialist tax advice to ensure full compliance with HMRC requirements and to minimise the tax burden where legally possible.

Safeguarding Trust Assets: Trustee Oversight and the Letter of Wishes

In well-structured discretionary trusts under English and Welsh law, the safeguarding of trust assets during divorce falls to the trustees themselves, guided by the trust deed and any letter of wishes from the settlor. English family trusts do not typically use external oversight roles. Instead, the trust deed itself includes clear provisions for trustee oversight and a defined process for removing and replacing trustees.

How Trustees Protect the Trust During Divorce

The trustees are the legal owners of the trust assets and have a fiduciary duty to all beneficiaries — not just the one going through a divorce. Their primary role is to exercise independent discretion in accordance with the trust deed, considering the interests of all beneficiaries and acting fairly between them.

A well-drafted trust deed will include powers that allow trustees to respond effectively to a divorce situation, such as:

• The power to exclude a beneficiary (such as an ex-spouse) from the class of potential beneficiaries.
• The power to add or remove trustees to ensure genuine independence.
• The power to withhold or defer distributions where making them could prejudice the trust or other beneficiaries.
• The requirement to take legal advice before making significant decisions affecting the trust.

The Role of the Letter of Wishes

The letter of wishes is a non-binding document written by the settlor that provides guidance to the trustees on how they would like the trust to be managed and distributed. While not legally enforceable, trustees will normally give serious consideration to the letter of wishes when exercising their discretion.

After a divorce within the family, the settlor should strongly consider updating their letter of wishes to reflect the changed circumstances — for example, clarifying that the ex-spouse of their child should not benefit from the trust, or that distributions should be structured to avoid inadvertently becoming a matrimonial resource in any future proceedings.

This combination of trustee discretion, clear trust deed powers, and an up-to-date letter of wishes provides robust protection for trust assets during divorce — without the need for external oversight mechanisms.

Common Misconceptions About Trusts and Divorce

There are many persistent myths about how trusts are treated during divorce in England and Wales. Understanding the reality is essential for anyone relying on a trust for asset protection.

Asset Protection Myths

One of the most common misconceptions is that placing assets in any type of trust automatically makes them untouchable in divorce. This is not the case. The level of protection depends entirely on the type of trust, how it was established, and who controls it.

A bare trust offers virtually no divorce protection — the beneficiary has an absolute right to the assets, and the court can readily identify and quantify that interest. Similarly, a trust that one spouse set up using matrimonial assets, where they are also the sole trustee, will receive little protection — the court will likely look through the trust structure.

In contrast, a discretionary trust established by a third party (such as a parent), with independent trustees and no guaranteed entitlement for any beneficiary, offers significantly stronger protection. The beneficiary has no more than a hope of receiving anything — there is no fixed interest for the court to value or redistribute. For a deeper understanding of how courts approach trust assets, this guide on trusts in divorce proceedings provides useful background.

However, even discretionary trusts are not absolutely immune. Courts have broad powers under the Matrimonial Causes Act 1973, and if the trust is classified as a nuptial settlement, the court can vary its terms. The key is proper structuring and genuinely independent trustee discretion.

Clarifying Misunderstandings

Another common misunderstanding is that the court will simply ignore trust assets — the opposite extreme. In reality, the court takes a pragmatic approach. It will consider trust assets as a potential financial resource, but the weight it gives them depends on the likelihood of the beneficiary actually receiving those assets.

Where trustees have historically made regular distributions to the divorcing spouse, the court is more likely to treat future distributions as probable. Where no distributions have ever been made, and the trustees demonstrate genuine independence, the trust assets carry far less weight in the financial settlement.

It’s also a misconception that creating a trust after divorce proceedings have begun will offer protection. Courts can — and do — look at the timing of trust creation. A trust established during or shortly before divorce proceedings is likely to be viewed with suspicion and may be treated as a deliberate attempt to put assets beyond the reach of the other spouse.

The takeaway is clear: trusts are a powerful tool for divorce protection, but only when they are properly structured, set up well in advance, and managed with genuine trustee independence. Plan, don’t panic — and get specialist advice early.

The Future of Trusts Amid Changing Legislation

UK trust law and family law are both evolving, and changes to either could affect how trusts are treated in divorce proceedings. Staying informed about potential reforms is essential for anyone who has established a trust or is considering doing so.

Potential Reforms and Their Impact

Several areas of potential reform could affect how trusts interact with divorce in the coming years. The Law Commission has periodically reviewed matrimonial property law and the financial remedies available on divorce. Any move towards a more formulaic approach to asset division — as used in some other jurisdictions — could change how courts treat trust interests.

Additionally, changes to the inheritance tax and trust taxation regime may alter the financial landscape. From April 2027, inherited pensions will become liable for IHT, which could increase the importance of trusts as a planning tool. The ongoing freeze of the nil rate band at £325,000 (in place since 2009 and extended until at least April 2031) means that more ordinary families are being caught by IHT — making estate planning, including trust planning, increasingly relevant for homeowners across England and Wales, where the average home is now worth around £290,000.

From April 2026, Business Property Relief (BPR) and Agricultural Property Relief (APR) will be capped at 100% for the first £1 million of combined business and agricultural property, with only 50% relief on the excess. For families with business or agricultural assets held in trust, this change could significantly affect the overall estate planning picture and the relative importance of the trust structure.

The Trust Registration Service (TRS) requirements have also expanded, with all UK express trusts — including bare trusts — now requiring registration within 90 days of creation. While the TRS register is not publicly accessible (unlike Companies House), this increased regulatory framework means that trusts are more visible to HMRC, which could influence how they are perceived and investigated in divorce proceedings.

Keeping up with these changes is vital if you have trusts in place. As Mike Pugh advises: trusts are not just for the rich — they’re for the smart. Proactive planning, regular review of your trust arrangements, and specialist legal advice are the best protection against an uncertain legislative future.