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The RL360 Split Trust allows a UK domiciled individual with a RL360 LifePlan policy to undertake flexible Inheritance Tax (IHT) planning where Critical Illness Cover and Life Cover are selected.
Upon the diagnosis of a Critical Illness and subject to surviving the diagnosis by 30 days, the trustees will advance the Critical Illness Cover to the life assured for them to use as they see fit. The Life Cover element of LifePlan will remain in trust and will not be taken into account for Inheritance Tax (IHT) valuation purposes on their death.
General Features of the RL360 Split Trust
- can only be used with RL360 LifePlan
- must only be used where the plan is owned by one person where both Critical Illness Cover and Life Cover are selected
- the Settlor is automatically included as a trustee
- critical Illness Cover is advanced to life assured (subject to surviving the diagnosis by 30 days)
- life Cover remains in trust for the beneficiaries
- life Cover element will not be taken into account for IHT purposes
The RL360 Split Trust would be suitable for individuals who
- require the policy to be placed in trust but require access to a lump sum if diagnosed with a Critical Illness
- are UK domiciled or deemed UK domiciled for Inheritance Tax purposes
- wish to avoid Manx Probate and ensure policy proceeds can be paid without further cost or delay