What is a "Deed of Trust"

From my understanding a deed of trust is where 2 individuals or more purchase a property. However only one of their names goes on the title deeds of the property. Following on from this, the 2 inidividuals sign a separate agreement with their solicitor which is legally binding called a deed of trust. This agrees that the 2 individuals each have a 50% shareholding in the property, even though only one person is on the title deeds. Both parties sign this document.

This is done where one party may want to remain anonymous or else they wish to avail of the first time buyers stamp duty exemption, where the other individual is not a first time buyer.

Hope this explains it!
 
There are many different types of Deed of Trust, you'll have to explain context.
 
aetius said:
There are many different types of Deed of Trust, you'll have to explain context.
Click to expand...

Lets say in this context,

My father has a house that my sister (his daughter) has been living in for a number of years.
My dad has since retired and is receiving a standard state pension.
My sister has gotten married and so is moving out of the house so my dad is thinking of renting it out.
However because he is on the state pension this may affect his benefits.
Would it possible for me to become the landlord of the property by using a "Deed of Trust" and me being able to gift this money to my dad?
Obviously I would then be liable for any tax etc.

Or what would be the best way to go about things?
 
Where is your father living now/where would he live if he rented the house? Your sister was living there - with him or not? if not and he was living somewhere else the ownership of the house should have been an issue then. Well that is if its a means tested pension - is it means tested or contributory? if the latter then his means and income do not come into it. TBH the question and circumstances are a mite confusing.
 
A trust is a situation where the legal title and the beneficial ownership are split, and the holder of the legal title holds it "on trust" for the beneficiary. Normally the legal and beneficial interests are held by the same person (i.e. I am the legal owner and I am also the beneficial owner)

In your particular situation to establish a trust there would have to be a transfer or conveyance of the property to you (with the legal costs and stamp duty), and a declaration of trust, declaring that you hold the property on trust for your father. Then any income is received by you. However, the income would still really be your fathers, as you are only holding the property "on trust" for him - any money received would have to be applied for his benefit. This hardly gets you out of the situation you want to avoid, as this income would still have to be declared. It would also be assessed as taxable income for your father.

To do what you want, you'd be going down the avenue of a secret trust, and tbh it's bordering on welfare fraud, so I'd be reluctant to advise on that. Talk to a tax accountant and see if there's a legit way of achieving a similar result.
 
No that is grand, i figured that would be a problem alright. Cheers for the advice.

Sorry if it was a tad confusing.
 
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