Leaving Your Estate to Children: Inheriting at 18, 21 or 25

Why children's inheritance is held in trust

A child under 18 cannot give a valid receipt for an inheritance. So if your will leaves money or property to your children, someone has to look after it until they are older.

The usual answer is a trust in your will. This guide explains how it works and the choices you can make. It is general information about the law in England and Wales, not advice on your own situation.

What an age trust is

An age trust holds each child's share until they reach an age you choose. Until then, the people you name as trustees look after it. When a child reaches that age, they receive their share outright.

The most common ages are 18, 21 and 25. Each child has a fixed share, usually equal, and each share is held for that child only.

What trustees can do before the chosen age

Trustees do not have to wait until the chosen age to help. The law, and most wills, give them powers to use the money for each child along the way.

• Maintenance: they can use the income from a share for the child's upkeep, such as food, clothes and childcare.
• Education: they can pay for school costs, trips, training or university.
• Advancing capital: they can pay out some of the share early for the child's benefit. Help with university or a deposit on a first home are common examples.
• Investing: they must invest the money sensibly while they hold it.

Every payment must be for the benefit of the child whose share it is. Trustees should keep records of what they pay and why.

Choosing 18, 21 or 25

The main question is usually how much each child might receive, and when you think they will be ready for it. Many parents feel 18 is too young for a large sum. The tax rules also differ for each age.

At 18

Each child receives their share outright at 18.

• For your own children, there is no inheritance tax charge inside the trust while it lasts.
• Income and gains can be taxed as the child's own.
• The catch is that each child takes the whole share at 18, whatever their circumstances.

If the shares are modest, 18 can still be the simplest choice.

At 21 or 25: an "18 to 25 trust"

If you choose an age after 18 but no later than 25, the trust is often called an 18 to 25 trust. It has its own tax rules.

• Before 18, there is no inheritance tax charge inside the trust.
• After 18, a small charge can arise when money is paid out to a child. The longer the money stays in the trust after 18, the larger the charge can be.
• The charge is capped low. At current rates it can never be more than 4.2% of the share, and that is for a share held until 25.
• The rate is worked out from the value of the trust when it starts, after taking off the nil rate band of £325,000.
• So where the amount held in trust is within the nil rate band, the charge is often nothing.

Capital gains in an 18 to 25 trust are taxed at trust rates. Income is covered below.

Source: HMRC, IHTM42816: Special trusts: Age 18-to-25 trusts (Inheritance Tax Manual) (Updated 7 April 2026), checked October 2026.

Source: GOV.UK, How Inheritance Tax works: thresholds, rules and allowances, checked October 2026.

Over 25

The special tax treatment ends at 25. If you choose an older age, each share falls into the ordinary tax rules for trusts.

These rules can bring inheritance tax charges while the trust lasts, as well as when money leaves it. If you would like an age over 25, tell our team and they will explain the position with you.

Income: paid from 18, or saved

If you choose 21 or 25, you also decide what happens to the income each share earns, such as interest, between 18 and that age.

• Save it until then: the trustees add the income to the share, but can still use it for the child at any time. Income saved in the trust is taxed at trust rates. This is the usual choice.
• Pay it from 18: each child receives the income from their share from 18, and it is taxed as their own income. The share itself still waits until the age you chose.

If a will says nothing about this, the general law usually pays the income to each child from 18.

Choosing trustees

Your trustees look after your children's money until they inherit. Most people choose their executors, but you can choose different people.

• Two is sensible: we recommend at least two trustees, so that no one person has sole control of the money.
• Ideally not only the guardian: a guardian often acts as a trustee too, and that can work well. But one person then both cares for the children and controls their money, so many parents add someone independent.
• Organised and careful with money: trustees keep records, invest sensibly and may need to deal with tax returns for the trust.
• Willing to do it: talk to the people you have in mind before you name them.

Our guide on guardianship covers choosing the people who would raise your children.

Your home and the residence nil rate band

The residence nil rate band is an extra inheritance tax allowance when your home passes to your children or grandchildren. A home left in most kinds of trust does not count for this allowance.

There is an exception for children's trusts. HMRC treats a home as inherited by your child if it is held for them on one of two special trusts. These are a trust for a bereaved minor, which ends by 18, and an 18 to 25 trust.

So the allowance can still apply when your home passes to your own children in a trust ending at 18, 21 or 25. Other rules, such as the value of your estate, still affect how much you get.

Source: HMRC, IHTM46014: Basic definitions: Inherited (Inheritance Tax Manual) (Updated 7 April 2026), checked October 2026.

If a child dies before inheriting

If one of your children dies before you, or before reaching the chosen age, their own children usually take that share instead. You can choose the age at which these grandchildren inherit.

The special tax rules in this guide are for your own children. If a grandchild inherits a share in place of a child, that share is taxed as an ordinary trust.

A discretionary trust: the flexible alternative

Instead of fixed shares, you can let your trustees decide how much each child receives and when. This is a discretionary trust. It can suit families where children's needs may be different.

The trust ends when your youngest child reaches the age you choose, and the trustees then share out what is left. You can leave a letter of wishes to guide them.

The trade off is tax. A discretionary trust is taxed as a trust in its own right, so charges can arise while it lasts. It may also lose the residence nil rate band. Our team will check this with you before your will is finalised.

How GetWill handles this

If you leave your estate to your children, the GetWill questionnaire asks:

• whether each child has an equal share at an age, or your trustees decide
• whether each child inherits at 18, 21 or 25, with a short comparison of each age
• for 21 or 25, whether income is saved or paid from 18
• the age at which grandchildren inherit if one of your children dies first
• whether your executors or different people look after the money

We recommend at least two trustees. Fifty Six Law reviews every will before it is finalised. If your choices need explaining, our team will contact you.

Your will pack also includes a plain summary of how your children's inheritance is held.

Next steps

• Start your will: /intake
• Guardians for your children: Wills and Children: Guardianship
• More about trusts: Trusts in Wills
• Tax basics: Understanding Inheritance Tax