NS&I in trust ?

higueron

I applied for and got an NS& I savings certificate to the value of 15k I applied for it in joint names making my wife the secondary holder I thought we might be able to open another one in my wifes name with me as the secondary holder but have been informed that this is not allowed but the lady on the NS&I helpline informed me that my wife could take one out in trust could someone please explain exactly what this means and what the implications are.

Jonbvn

You hold them in trust for your wife and vice versa. You will need a solicitor to set up the trusts for you.

Arthurian

Jonbvn wrote: »

You hold them in trust for your wife and vice versa. You will need a solicitor to set up the trusts for you.

Is it not possible just to complete the "Trust" application form http://www.nsandi.com/files/asset/pdf/savings-certs-trustees.pdf ? Is it necessary to use a solicitor to draw up trust documents? I seem to remember a post office manager once telling me all I had to do to put money in trust for my children was to write "Arthurian in trust for Arthurianchild" as the name on the application form for a savings account. I fully accept that could have been wrong - there was a debate about this topic a few years ago on the Motley Fool boards. http://boards.fool.co.uk/investing-money-in-trust-for-over-16s-11072585.aspx?sort=whole

middypuss

I too was under the impression that a solicitor was not needed.If you use the first option in the joint names of the trustees and beneficiarys then i understood(having talked to NS&I) that just filling the form in with you as trustee and your wife as beneficiary and both signing the form would suffice.Please feel free to inform me otherwise as the information I got from NS&I was some time ago.

higueron

Just received the in trust forms from NS&I also spoke to an advisor on the phone and basicall all you need to do is make your spouse the beneficiary which means that you can take one out for your wife and she can do the same for the husband which means that with the certificate that I have already purchased you can have a total of 45k between husband and wife.

tillycat123

I am taking this out for a 14 year old with him as the beneficiary and me as the trustee. Just download the form from their site and return. Nothing more than that needed.

The lady at NS&I said I am also allowed to take one out in my own right as well. Is it a good idea for husbands and wifes to be trustees on each others? Is it easier to sort out in the future if something was to happen to the spouse by doing it this way?

Reaper

higueron wrote: »

Just received the in trust forms from NS&I also spoke to an advisor on the phone and basicall all you need to do is make your spouse the beneficiary which means that you can take one out for your wife and she can do the same for the husband which means that with the certificate that I have already purchased you can have a total of 45k between husband and wife.

This makes no sense to me. The money belongs to the beneficiary. The idea that taking them out in each others names means you are then able to have a joint account on top of that is daft. I think the NS&I are handing out duff info. Perhaps it bypasses their checks doing this but that is not the same as saying it is allowed. [EDIT: I think I may be wrong on this. See my next post]

tillycat123 wrote: »

I am taking this out for a 14 year old with him as the beneficiary and me as the trustee... The lady at NS&I said I am also allowed to take one out in my own right as well.

Absolutely, that is because the one you set up does not belong to you, you are just administering it.

tillycat123 wrote: »

Is it a good idea for husbands and wifes to be trustees on each others? Is it easier to sort out in the future if something was to happen to the spouse by doing it this way?

I can't see any advantages.

alahol2

Reaper wrote: »

This makes no sense to me. The money belongs to the beneficiary. The idea that taking them out in each others names means you are then able to have a joint account on top of that is daft. I think the NS&I are handing out duff info. Perhaps it bypasses their checks doing this but that is not the same as saying it is allowed.

Sorry, you are wrong. The terms and conditions state that certificates held in trust do not count towards the personal limits of either the trustee or the beneficiary.
It means that a husband and wife can actually shelter £60,000 between them. If you have kids, then another £15,000 for each one.

lisyloo

If you have kids, then another £15,000 for each one.

However I think you would actually have to GIVE the money to the kids and not use it as a tax shelter for yourself.
Without spouses there is no issue as you can give each other whatever you want without limits or IHT issues.

Reaper

alahol2 wrote: »

Sorry, you are wrong. The terms and conditions state that certificates held in trust do not count towards the personal limits of either the trustee or the beneficiary.
It means that a husband and wife can actually shelter £60,000 between them.

Being wrong is entirely possible but can you point me to where it says that? If we take your interpretation where they do not count at all then you could take out an unlimited number of accounts. Why stop at £60k for a couple?

Looking on their web site at the T&C I found these:

42. Where Certificates are held in joint names of two or more persons, the total value of the Certificates (at purchase price) will be counted against each of the joint holders when reckoning the value of Certificates held by them for this purpose.

So as soon as you get a joint £15k you have blown both of your allowances.

43. Certificates held by someone as a trustee will not count towards their own holding.

No argument here, as I am saying it is the beneficiary that counts, the trustee is irrelevant.

The only mention on beneficiaries is this very confusing clause:

44. Certificates held in the joint names of a trustee and beneficiary will not count towards the beneficiary’s own holding.

This is the one I am struggling to understand. I have re-read it about 100 times and am coming round to higueron's interpretation, even if I do think it is crazy. A joint certificate is excluded when adding up what the beneficiary has.

That means the best you can do is:
1) Husband and wife joint = £15k
2) Husband in trust for wife = £15k
3) Wife in trust for husband = £15k
So the max total is £45k

I don't believe you are correct that it is possible to reach £60k just from a husband and wife. Perhaps you could explain your reasoning?

alahol2

Reaper wrote: »

The only mention on beneficiaries is this very confusing clause:
This is the one I am struggling to understand. I have re-read it about 100 times and am coming round to higueron's interpretation, even if I do think it is crazy. A joint certificate is excluded when adding up what the beneficiary has.

That means the best you can do is:
1) Husband and wife joint = £15k
2) Husband in trust for wife = £15k
3) Wife in trust for husband = £15k
So the max total is £45k

I don't believe you are correct that it is possible to reach £60k just from a husband and wife. Perhaps you could explain your reasoning?

The best you can do is:
1) Husband = £15K
2) Wife = £15k
2) Husband in trust for wife (joint names) = £15k
3) Wife in trust for husband (joint names) = £15k
So the max total is £60k

And it's all fully within the terms and conditions. (ie clause 43 & 44)