Family Asset Protection Trusts

Family Asset Protection Trusts (FAPT)

A Family Asset Protection Trust (FAPT) is a structured trust-based solution designed to protect family wealth—most commonly the family home—from the most common and damaging risks that arise after death or incapacity.

For many families, the greatest threat to their legacy is not tax, but what happens later: remarriage, new relationships, blended families, or unintended changes in who ultimately benefits. An FAPT is designed to deal with these realities head-on.

Why Families Choose an FAPT

Most people assume that once they have made a will, their wishes are fixed. In reality, wills only control what happens on the first death. What happens after that is often outside the original family’s control.

This is where FAPTs are most valuable.

Sideways Disinheritance – the Core Risk

Sideways disinheritance occurs when assets pass away from the original family line, usually following:

Remarriage or new long-term relationships
Pressure from a new partner or family
Changes to wills made years later under very different circumstances

A typical scenario:

One spouse dies and leaves everything to the survivor
The survivor later remarries
On the survivor’s death, assets pass to the new spouse or their family
The original children inherit little or nothing

This outcome is entirely legal—and extremely common.

An FAPT is specifically designed to prevent this, by separating use and enjoyment of assets from ultimate ownership.

What an FAPT Actually Does

An FAPT allows you to:

Continue living in your home as normal
Retain full control during your lifetime
Decide now who ultimately benefits in the long term
Prevent assets being redirected later, intentionally or otherwise

The trust operates quietly in the background, but it locks in the succession outcome you intend.

How the Structure Works (In Simple Terms)

Although sold as a single solution, an FAPT is best understood as a carefully coordinated trust framework, typically involving:

A Discretionary Trust up to the available Nil Rate Band (NRB)
Additional trust structures to deal with value above the NRB
Reserved lifetime rights allowing continued occupation and control

This “mixed trust” approach allows flexibility where it is needed, and certainty where it matters most.

The important point is not the labels, but the result: protection without disruption.

Day-to-Day Life Does Not Change

One of the most common concerns is:

“Will I still own my home?”

In practical terms:

You continue to live in the property
You can sell, move, or downsize
You retain control through the trustees
Nothing changes in how you use the asset

The trust is about future outcomes, not interfering with your present life.

You continue to live in the property
You can sell, move, or downsize
You retain control through the trustees
Nothing changes in how you use the asset

What an FAPT Protects Against

An FAPT is designed to protect against:

Sideways disinheritance (the single most common reason)
Family disputes after death
Relationship breakdowns affecting beneficiaries
Beneficiaries’ creditors or bankruptcy
Loss of control over timing of inheritance
Probate delays and exposure

While tax mitigation can arise as part of the structure, FAPTs are fundamentally protection and control tools, not tax gimmicks.

Long-Term Care – A Realistic Perspective

An FAPT is not a guaranteed shield against long-term care costs, and any firm suggesting otherwise should be treated with caution.

However, when implemented early, as part of a wider planning strategy, an FAPT can form part of a defensible, long-term positioning of assets, rather than a last-minute reaction.

Timing and intention matter.

Who an FAPT Is Most Suitable For

FAPTs are particularly appropriate where:

The family home represents the majority of family wealth
There are children from a previous relationship
The client expects remarriage or changing family dynamics
Preserving inheritance for children is a priority
Control matters more than simplicity

They are less suitable where estates are small, highly liquid, or where clients want the absolute minimum of administration.

Why This Planning Needs to Be Done Now

Once assets have passed outright to a surviving spouse or partner, control is lost. No will made later can restore it.

An FAPT is about acting before the risk materialises—not trying to fix things when it is already too late.

Families who put these structures in place do so because they want certainty, not hope.

How CHC Legal Assists

CHC Legal’s role is to:

Assess whether an FAPT is genuinely appropriate
Explain the structure clearly and honestly
Implement a professionally drafted trust framework
Integrate the trust with wills, property ownership, and LPAs
Ensure expectations are realistic and legally grounded

Our approach is planning-led, not product-led. We implement FAPTs where they solve real problems—not as a default.

Summary

A Family Asset Protection Trust is one of the most effective tools available for preventing sideways disinheritance and preserving family wealth across generations.

It allows you to live as you always have, while quietly ensuring that what you have built ends up where you intend—not where circumstances later push it.

If protecting your family line matters, this is planning worth doing.

Family Asset Protection Trusts