Trust for Bereaved Minor UK (2026): IHT Advantages, Age 18 Rule & How to Set One Up in a Will

A trust for a bereaved minor (TBM) is a statutory trust established under section 71A of the Inheritance Tax Act 1984. It is specifically designed for a child (under 18) who has lost a parent — the trust holds the child's inheritance from their deceased parent until the child turns 18, when the assets pass to them absolutely. The key IHT advantage is that a TBM is exempt from the 10-year periodic charge (up to 6% every 10 years) and the exit charge that applies to ordinary discretionary trusts. A TBM must satisfy four conditions: (1) the trust was established under the will or intestacy of a deceased parent; (2) the beneficiary is a minor child of the deceased; (3) the beneficiary becomes entitled to the assets at age 18 at the latest; (4) until that time, the beneficiary is entitled to all trust income.

A TBM is not a relevant property trust — it falls outside the main IHT charging regime that applies to discretionary trusts. This means: (1) no 10-year periodic charge (which can be up to 6% of the trust value every 10 years); (2) no exit charge when assets are distributed to the child; (3) no entry charge (because the trust is established under a will using the deceased parent's nil-rate band). When the child reaches 18 and receives the assets outright, this is not a chargeable event for IHT. By contrast, a standard discretionary trust holding the same assets would incur periodic and exit charges, potentially reducing the child's inheritance by thousands of pounds over time.

For a strict trust for a bereaved minor under s71A IHTA 1984, the child must become entitled to the trust capital at age 18. You cannot extend this to 21 or 25 in a TBM without losing the special IHT treatment. However, there is an alternative: the 18-to-25 trust (s71D IHTA 1984), which allows the inheritance to be held until age 25 with reduced (but not zero) IHT charges. For an 18-to-25 trust, no exit charge applies until the child reaches 18; after 18, an exit charge applies on distribution, but it is calculated on the period after age 18 only (not the full trust period). The exit charge is lower than a full discretionary trust exit charge.

Both are statutory will trusts for children who have lost a parent, but they differ on the distribution age and IHT charges. TBM (s71A): assets must pass at 18 — fully IHT-exempt (no periodic or exit charges). 18-to-25 trust (s71D): assets can be held to age 25 — no IHT charges during ages 0–18; exit charge applies on distribution between ages 18 and 25 (at a reduced rate based on the proportion of time since age 18). For most families, a TBM at 18 is the simplest and most IHT-efficient option. The 18-to-25 trust is better if you believe the child is not ready to manage a large inheritance at 18 — the modest exit charge may be worth paying for the additional protection period.

The trustees of a TBM are appointed in the will — usually the surviving parent (if the TBM is under the will of the other parent), the guardians, or trusted family members. The trustees manage and invest the trust assets, pay income to or for the benefit of the child (e.g. school fees, living expenses), and distribute the capital when the child reaches the specified age. There must be at least two trustees, or a trust corporation, to give a good receipt for capital on distribution. Choose trustees who are: trustworthy, financially literate, likely to outlive the distribution date, and willing to act. Name substitute trustees in case a primary trustee is unable to act.

Yes — a TBM can hold any kind of asset, including real property. If the family home is included in a TBM, the trustees hold the property on trust for the child. The child's parent (if surviving) may live in the property as a trustee and under the trust terms. However, if the TBM holds the family home, the Residence Nil-Rate Band still applies on the deceased parent's death because the trust passes the property to a direct descendant (the child). When the child reaches 18 and the home is transferred to them, no exit charge applies under a TBM. For blended family planning, a life interest trust for the surviving parent with a TBM for the children on the second death is a common structure.

For most parents with minor children, a straightforward TBM is one of the most valuable provisions in a will — and the IHT advantages are significant for any sizeable estate. WillSafe UK's will kits are designed for straightforward estates. The statutory conditions for a TBM (s71A) are precise: the trust must be correctly worded to satisfy the age-18 entitlement and income entitlement conditions — if they are not met, the trust falls into the discretionary trust regime and the IHT advantages are lost. For estates where the child's inheritance from the deceased parent is likely to be significant (above £100,000), professional drafting of the TBM provisions is strongly recommended to ensure the statutory conditions are met and the IHT advantages are preserved.