The Flexible Life Interest Trust: a modern estate planning solution

One increasingly popular type of trust for estate planning is the Flexible Life Interest Trust (FLIT). This innovative Trust structure can be particularly useful for blended families and situations where someone wants to provide for a spouse while also preserving assets for children from a previous relationship.

What is a Flexible Life Interest Trust?

A FLIT is often used when there is a second marriage and is sometimes described as the ‘ideal modern family trust’. A couple could have got together later in life, and one of them may own their own property and want that property to pass to their children, but not leave their new spouse without a home. This is where the FLIT comes in. It can be set up as a Will Trust in your Will and leaves assets in your estate, which can include property, on Trust. There can be several beneficiaries of the Trust, including children, but one (usually the surviving spouse) is named as the life tenant.

The life tenant can remain in the Trust property and enjoy the property until they die. They will receive all the income from the Trust during their lifetime and will be treated as the ‘main beneficiary’. One of the benefits of this type of Trust is that it gives the trustees flexibility as they can give or lend capital from the Trust to the main beneficiary during their lifetime. Capital can also be advanced to the other beneficiaries. So, for example, the life tenant may need a new kitchen and the trustees can advance capital to the life tenant to pay for this. Likewise, the trustees could exercise their discretion and buy a new car for one of the other beneficiaries of the Trust if required.

If the person who has set up the Trust would like the Trust fund distributed in a certain way, or wants to ensure that certain beneficiaries benefit in a particular way from the Trust, they can simply prepare a letter of wishes to go alongside the Trust. This is a non-legally binding document, but it gives the trustees some direction as to how to deal with the Trust.

Advantages and disadvantages of having a FLIT in your Will:


  • A FLIT is ideal for protecting the assets of the estate on the first death, but also on the second death, as the Trust can be structured in such a way that it becomes a discretionary Trust after the life tenant dies to benefit future generations.
  • A FLIT protects the estate in the event the life tenant becomes bankrupt or goes into care as the Trust owns the assets, not the life tenant. The Trust also protects the assets from passing to a new spouse by either being transferred to them as part of divorce proceedings or being left to the new spouse by Will or intestacy.
  • The assets can be protected for the benefit of the other beneficiaries from third party claims if it is a discretionary Trust, after the life tenant dies, as the assets remain held by the trustees on the terms of the Trust, not the individual beneficiaries.
  • The trustees can loan money to beneficiaries, so it does not have any effect on the size of their own estate, thus helping with any potential inheritance tax issues. 


  • The main tax consideration of a FLIT created by Will is the future IHT liability which may arise as the assets in the FLIT are taken into account when calculating IHT on the life tenant’s death.
  • Different IHT rules apply if a FLIT is created during lifetime rather than via a Will, with different tax rules applying depending on whether the Trust was made before or after the Finance Act 2006.

What shall I do if I want to find out more about this?

Setting up a FLIT, or any type of Trust, involves complex legal and tax considerations. It is crucial to consult experienced estate planning lawyers to ensure the Trust is properly structured and administered according to your wishes and current laws. With professional guidance, a Flexible Life Interest Trust can be a powerful tool for balancing different beneficiaries’ interests.

About the authors

about the author img

Hannah Worricker


Advises on the administration of trusts and estates, drafting wills, LPAs, Court of Protection and how to minimise the risk of a claim against an estate.

Stay connected, sign up for updates

Stay connected

Recent articles


Maximising wealth for future generations – the benefits of a family investment company

A family investment company offers a strategic way to manage wealth, ensure tax efficiency and preserve family assets for future generations.



The role of an Executor or Administrator in estate administration

Whether you’ve been appointed by a loved one’s Will or by operation of the Intestacy Rules, your role involves legal obligations, financial tasks and, often overlooked, emotional considerations.



Protection of assets pre-marriage and considerations on wealth planning

In this episode, we discuss the protection of assets pre-marriage and the key considerations for wealth planning for the future.



Digital legacy management the importance of documenting digital assets for executors

It is increasingly important to make sure our executors can access all our assets by keeping a comprehensive record of our digital assets, particularly those associated with financial accounts.