What is a life interest trust?
A life interest trust gives one person (the ‘life tenant’) the right to income from, or use of, an asset for their lifetime — for example to live in a home or receive investment income — while the capital passes to other beneficiaries afterwards. It's widely used in second marriages to provide for a surviving spouse while protecting children's eventual inheritance.
Detailed explanation
It splits an asset across time: use now for one person, ownership later for others.
- The life tenant benefits during their life (income or occupation).
- The remaindermen receive the capital when the life interest ends.
- Common for the family home in blended families.
Frank's will gives his second wife a life interest in his investment portfolio: she receives the income for the rest of her life, and on her death the capital passes to Frank's children from his first marriage.
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Sources
- GOV.UK — Trusts and taxes
- GOV.UK — Types of trust
- Trustee Act 2000 — legislation.gov.uk
- Reviewed by
- ClearLegacy editorial team
- Last reviewed
- June 2026
- Next review
- December 2026
- Jurisdiction
- England & Wales
Frequently asked questions
What is a life interest trust?
It gives one person the right to income from or use of an asset for life, with the capital passing to other beneficiaries afterwards. It is often used in second marriages to provide for a surviving spouse while protecting children's inheritance.
Who controls a life interest trust?
The trustees hold and manage the asset, but the life tenant has the right to the income or use of it for their lifetime. When the life interest ends, the capital passes to the remainder beneficiaries.
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