If you own a home in Poole, Bournemouth, Christchurch, Wimborne or elsewhere in Dorset, your property is likely your family's largest asset.
Many homeowners assume that a standard mirror Will automatically guarantees that their share of the family home will eventually pass to their children. However, circumstances can change after the first death, and without careful planning, assets intended for one generation may not always end up where originally planned.
A Property Protection Trust (PPT) is designed to help provide security for a surviving spouse or partner while preserving the deceased's share of the property for future beneficiaries.
In this guide, we'll explain how Property Protection Trusts work, the situations where they may be beneficial, and why many Dorset homeowners choose to include them within their estate planning.
Why Homeowners Consider Property Protection Trusts
For many couples, a simple mirror Will leaves everything to the surviving spouse and then, on the second death, to the children.
For some families, this arrangement works perfectly well.
However, there are situations where additional protection may be desirable.
How sideways disinheritance happens
One of the most common concerns is what's often referred to as sideways disinheritance.
Consider a typical example:
- A married couple own a home together.
- The first spouse passes away.
- The surviving spouse inherits the entire property outright.
- Several years later, the survivor remarries, enters a new relationship, or creates a new Will.
While no one plans for family circumstances to change, life can be unpredictable. In some situations, assets originally intended for children from the first relationship may ultimately pass elsewhere.
A Property Protection Trust can help ensure that the deceased's share of the property remains earmarked for their chosen beneficiaries while still allowing the surviving partner to continue living in the home.
Property Protection Trusts and Care Fees
Another reason some homeowners explore Property Protection Trusts is concern about future residential care costs.
In England, local authorities carry out financial assessments when determining whether an individual must contribute towards the cost of their care. Property ownership can form part of that assessment, depending on individual circumstances.
With a standard Will, the deceased's share of the property typically passes outright to the surviving spouse. As a result, the survivor may eventually own 100% of the property.
By contrast, a Property Protection Trust places the deceased's share into trust rather than passing it outright to the survivor.
Because that share is held within the trust structure, it may be treated differently from assets owned personally by the surviving spouse. However, care fee assessments are complex and depend on individual circumstances, applicable legislation, and local authority decisions.
It is important to understand that no estate planning arrangement can guarantee protection from future care fees.
How a Property Protection Trust Works
A Property Protection Trust is commonly used by married couples and civil partners who own their home jointly.
Step 1: Severing the joint tenancy
Many couples own their home as Joint Tenants.
Under this arrangement, the property automatically passes to the surviving owner regardless of what the Will says.
To use a Property Protection Trust, ownership is usually changed to Tenants in Common.
This allows each person to own a distinct share of the property, typically 50% each.
Good news: changing ownership from Joint Tenants to Tenants in Common is usually a straightforward administrative process. As part of our Property Protection Trust packages, we handle the necessary Land Registry paperwork on your behalf to help ensure everything is completed correctly and efficiently.
Step 2: Creating the trust in the Will
Instead of leaving their share of the property directly to the surviving spouse, the deceased's Will places that share into a Property Protection Trust.
Step 3: Protecting both generations
The trust is designed to balance two important objectives:
Protecting the surviving partner
The surviving spouse or partner is typically given the right to continue living in the property for life. Depending on the trust wording, they may also have flexibility to move home or downsize in the future.
Protecting future beneficiaries
The deceased's share remains allocated for the chosen beneficiaries, often children or grandchildren, rather than passing outright into the survivor's estate.
Is a Property Protection Trust Right for You?
A Property Protection Trust may be worth considering if:
- You are married or in a civil partnership and own a property together.
- You want to provide security for your spouse or partner while preserving assets for your children.
- You are part of a blended family and want to ensure children from a previous relationship remain protected.
- Your home represents a significant proportion of your overall estate.
- You would like greater control over how your share of the property is ultimately distributed.
Every family situation is different, which is why professional advice is important before deciding whether a trust-based arrangement is appropriate.
Property Protection Trusts in Poole and Bournemouth
With property values across Poole, Bournemouth and the wider Dorset area continuing to represent a substantial proportion of many families' wealth, it is understandable that homeowners want to ensure those assets are passed on in accordance with their wishes.
Many people assume that trust-based estate planning is only available through large solicitor firms. In reality, professionally prepared Wills incorporating appropriate trust provisions can often be arranged on a fixed-fee basis. The price quoted is the price you pay.
Frequently asked questions
Can a Property Protection Trust prevent care fees?
No arrangement can guarantee protection from future care fees. However, a Property Protection Trust may help preserve the deceased's share of a property for future beneficiaries, depending on the circumstances and any future financial assessments.
Can my spouse still live in the property?
Yes. The trust is usually designed to allow the surviving spouse or partner to continue living in the property for the rest of their life.
Can the property still be sold?
In many cases, yes. Trust provisions can often allow the surviving partner to move home or downsize, subject to the terms of the trust.
What is severance of joint tenancy?
Severing a joint tenancy changes property ownership from Joint Tenants to Tenants in Common, allowing each owner to hold a distinct share of the property.
Not sure whether a Trust is right for you?
If you're unsure whether a Property Protection Trust is appropriate for your circumstances, we're happy to explain how it works and whether it's likely to benefit your family.
Sometimes a standard Will is the right solution. Sometimes a Trust provides valuable additional protection. We'll explain your options clearly, with no pressure and no unnecessary complexity.