I need to open "Trustees" account

NOWSE

Together with my brother, I have been appointed as a trustees to look after money left by my uncle for his son.
As I see it, I need 2 things:
1) A current account that won't charge me (there will be minimal activity on the account) and pay some interest.
2) A place to put the bulk of the funds - £10,000 in an account allowing withdrawals at one month's notice and a longer term account for £100,000+.
Any advice gratefully received.

harryhound

How long until the son inherits in his own right?
How old will he be then?
Why a trust if he is of age; does he have a handicap?

See if you can find a knowledgeable building society; unfortunately most institutions get in a bir of a muddle with this situation and because two signatures are needed won't allow you access to internet rates etc.


I am a trustee of an account at Portman BS but they are just about to merge into the Nationwide.

Harry.

NOWSE

harryhound wrote: »

How long until the son inherits in his own right?
How old will he be then?
Why a trust if he is of age; does he have a handicap?

As he is mentally handicapped the trust will run for the rest of his life. He is in sheltered accomodation and the trustees' role is to ensure that he is provided for.

jonesMUFCforever

I would suggest getting professional help with investing the £100k with a view to getting it to appreciate in value or it will be eroded by inflation. Having it all just in a deposit account will not achieve this.

Many banks will open a trustees account but not many will offer a good rate of interest if any.
In this day and age I think 30 day accounts are very poor value - is there a specific reason you want to open one of these?

As Trustees accounts are neither personal or business accounts you may find a building society offering a better rate. Banks would only open a 'business' type of savings account IMO - these rates are not as good as personal accounts (as you can see from any newspaper when they publish revised rates).

harryhound

I think we might be talking about a "Disabled Person's Trust", having looked in a new "Which?" book called "Giving & Inheriting".
(I'm reading this book as I am in the process of re-writing my will. 15 months ago Gordon Brown's budget made serious changes to Accumulation and Maintenance Trusts (for healthy children up to the age of 25).

A DPT appears to be free of special income tax rates and periodic capital taxes only falling into Inheritance Tax (probably in the zero rate band) when the beneficiary dies.
There may be scope for claiming trust tax allowances AND individual tax allowances; but I don't know. Check your local library and see if they have a copy of this 2007 book.
You might be able to become a DPT "expert" and self administer the trust for which you are responsible. You are going to be responsible for the day to day administration and dealing with the accommodation issues etc. etc. anyway.

You may be able to contact a knowledgeable person via an organisation supporting handicapped people and get for free the benefit of their experience.

The point I am trying to make is that 100K will generate 5K a year in income, if you work the tax system correctly. Over half of this is needed just to cover inflation, leaving 2.5K. That buys very little once "professional fees" get added to the equation.

Harry.

PS Before you decide on your "Current Account", you need to work out how many transactions a year will be going through it. Twenty years ago, I was running a little trust using a building society pass book and a postal account, but it involved half a dozen inputs and a couple of dozen payments per year. Tax issues & return took about a day a year.
I think the Chelsea BS probably still does an account with a cheque book ?