Loan Trust

Prudential's Loan Trust allows the client to access a capital sum, while any growth on it is outside their estate. The client makes an interest-free loan to the trustees, which they then invest. The loan is usually repaid through regular payments to the client, but repayments can also be made as lump sums.

Key benefits of the Loan Trust

• Regular payments which may be free of any immediate liability to income tax
• Access at any time to all or part of the balance of the loan
• No Inheritance tax liability on establishing the trust
• Investment growth generated outside the client's estate
• A choice of onshore and international bonds, offering access to the fund management skills of the Prudential Group and other leading investment managers

The Loan Trust can be written as an absolute trust or a discretionary trust. With an absolute trust, the beneficiaries and their share of the trust fund are set when the trust is established, and cannot be altered. However, with a discretionary trust, beneficiaries do not have a right to the trust fund. Trustees can make payments to beneficiaries at their discretion.

For more information, please use the literature links below.

The above is based on our understanding as at April 2011 of the current taxation, legislation and HM Revenue & Customs practice, all of which are liable to change without notice. The impact of any taxation (and any tax reliefs) depends on individual circumstances.

Full terms and conditions are available on request.