Trust Account for Grandchildren

nxdmsandkaskdjaqd

My mother has allocated some money in a Trust Account for her Grandchildren. The trust funds are simply an Abbey Building Society Savings book which states that the funds are held in trust FOR the name of the grandchild. My parents have expressed their wishes in that the money only be used for Education or a deposit on a property.

The ages of the Grandchildren are : 16, 21, 24, 25, 29, 30, 30.
The bold numbers indicate that the child has had some or all of their money.

I beleive that as long as the money is in trust it still belongs to my Mother. Is that correct?

Is it also correct that once the Granchildren achieve 18 years old, then the money is automatically belongs to them?

Appreciate any information on this.

Robert

withnell

nxdmsandkaskdjaqd wrote: »

My mother has allocated some money in a Trust Account for her Grandchildren. The trust funds are simply an Abbey Building Society Savings book which states that the funds are held in trust FOR the name of the grandchild. My parents have expressed their wishes in that the money only be used for Education or a deposit on a property.

The ages of the Grandchildren are : 16, 21, 24, 25, 29, 30, 30.
The bold numbers indicate that the child has had some or all of their money.

I beleive that as long as the money is in trust it still belongs to my Mother. Is that correct?

Is it also correct that once the Granchildren achieve 18 years old, then the money is automatically belongs to them?

Appreciate any information on this.

Robert

The money belongs to the trust, not your mother - and there are only IHT implications if she dies within 7 years of setting up the trust.

Whether the money becomes theirs at 18 or not depends on the wording of the trust - for instance Prince William / Harry's trusts don't let them have it until 25+ I think

nxdmsandkaskdjaqd

Whether the money becomes theirs at 18 or not depends on the wording of the trust - for instance Prince William / Harry's trusts don't let them have it until 25+ I think

I do not beleive there was any wording in the trust details that say what age they can have the money.

If this is the case what then??

withnell

nxdmsandkaskdjaqd wrote: »

Whether the money becomes theirs at 18 or not depends on the wording of the trust - for instance Prince William / Harry's trusts don't let them have it until 25+ I think

I do not beleive there was any wording in the trust details that say what age they can have the money.

If this is the case what then??

If there's nothing saying they can have the money at a certain age, then you can only use the funds for education or a property deposit!

opinions4u

nxdmsandkaskdjaqd wrote: »

I beleive that as long as the money is in trust it still belongs to my Mother. Is that correct?

No. The money belongs to the trust.

Is it also correct that once the Granchildren achieve 18 years old, then the money is automatically belongs to them?

Not unless that is what the trust deed specifically states.

I do not beleive there was any wording in the trust details that say what age they can have the money.

In that case it is at the complete discretion of the trustee as to when the funds are distributed.

martinman3

I believe that withnell is correct if there is a named trust which has been set up, usually by a solicitor, with all the grandchildren as beneficiaries.

However, there are inconsistencies in the original post

nxdmsandkaskdjaqd wrote: »

My mother has allocated some money in a Trust Account for her Grandchildren. The trust funds are simply an Abbey Building Society Savings book which states that the funds are held in trust FOR the name of the grandchild.

It suggests that there is one account but then mentions that the account is held in trust for a single grandchild. I would have thought that either

1. The trust would be named and that name would be on the only savings book.
2. Every grandchild would be named on a single savings book, with 7 beneficiaries I would have thought this is unlikely.
3. Each grandchild is named on a separate savings book for each of them.

Could the OP please clarify which it is ?

nxdmsandkaskdjaqd

Hi sorry for the confusion, as each Grandchild was born my Parents set up a seperate savings account for each of them.

We have been advised if my Mother passes away then the children that have not had their money yet would not get it, that it is only available with my Mother's signature.

Half of the money for each of the remaining Grandchildren is in a Bond the rest in a savings account. The bonds mature early next year and my Mother wants to re-invest them with her as Trustee again. She is 84 and I am concerned that some of the Grandchildren have had their money in full, whilst some have had none so far, and that if she died they would be liable for Inheritence Tax.

Any advise is greatly appreciated.

martinman3

nxdmsandkaskdjaqd wrote: »

Hi sorry for the confusion, as each Grandchild was born my Parents set up a seperate savings account for each of them.

We have been advised if my Mother passes away then the children that have not had their money yet would not get it, that it is only available with my Mother's signature.

Half of the money for each of the remaining Grandchildren is in a Bond the rest in a savings account. The bonds mature early next year and my Mother wants to re-invest them with her as Trustee again. She is 84 and I am concerned that some of the Grandchildren have had their money in full, whilst some have had none so far, and that if she died they would be liable for Inheritence Tax.

Any advise is greatly appreciated.

The answers to your questions will depend on whether the accounts are really opened in trust or are 're:' accounts. This is a subject that has been covered on this forum before and you need to find out the status of these accounts.
opinions4u and withnell have considerable experience in this area.

withnell

As long as she has not maintained the benefit of the money, for instance keeping the interest payments for herself, then no IHT liability as the payments into trust were made more than 7 years ago

nxdmsandkaskdjaqd

Details on the book says:

Mrs XXXXX XXX
Trustee for
Mr XXXX XXXX

Hope this helps.

martinman3

Then I don't understand the advice you received

nxdmsandkaskdjaqd wrote: »

We have been advised if my Mother passes away then the children that have not had their money yet would not get it, that it is only available with my Mother's signature.

I thought that if the account is held in trust and the only trustee dies then the bank/building society would either allow a new trustee to be appointed for the account or give the money to the beneficiary.
And Abbey told you this ?
This is just guessing but if the passbooks have Abbey National Building Society on them it is possible that the branches do not have a copy of the original terms & conditions of this account. Are the account names on their computer systems shown as on the passbooks ?
The current T&Cs don't mention trust accounts at all.

10 Death

a) If the account is in your sole name we will ask your
personal representatives to provide proof of their authority
and then allow them to close your account.
b) If the account is in joint names it will continue in the

name(s) of the survivor(s).

After my own problems with Abbey, if you can't find the t&cs applicable to this account it may be simpler for your mother to open accounts in trust elsewhere, where the procedure on death of a trustee is clearly stated, and move the money over. It depends on how much of a hassle it is either way.