Please explain why a settlor would choose to create a Discretionary Trust over an Absolute Trust.

Adam and Liz are married and they have two children: Robert, age 32, and Clare, age 28, that are financially independent. Robert is married and has one child and Clare is going to get married. Both Robert and Clare are planning to have more children.

Adams and Lizs total estate compromises of:

Joint owned property: 1,500,000

Adamss ISA: 350,000

Lizs ISA: 200,000

Adams pension: 870,000

Lizs pension: 650,000

Cash savings (joint account): 230,000

Adams VCTs: 150,000

Joined owned Buy to Let property: 350,000

They also have the two following mortgages:

Mortgage on residential property: 130,000

Buy To Let mortgage: 80,000

Answer the following questions:

A) Could you please calculate what is going to be the Inheritance tax liability if Adam dies and transfers all his Estate to his children?

B) Could you please calculate the inheritance tax liability if Liz dies and she has a will where she transfers everything to her husband?

C) Could you please suggest 2 ways to reduce their Inheritance Tax liability on the second death if they want their children to receive their estate? One solution should include a protection policy and one solution should include the creation of a Trust. Explain why you chose the specific solution