Bank / building society account for Trust

pinkglitter80

Hello
First post here and I'm hoping you can help. I need to find somewhere I can set up an account for a Trust - a discretionary trust where I will be one of the trustees, to hold a lump sum for my children (from my mum's inheritance). So far I have only found one (Natwest) and my Dad (the other trustee) 'doesn't like them'. I can't find anywhere else though! Any ideas...? I'm not expecting any interest although it would be a bonus!
Thanks in advance

xylophone

It is possible to hold any account in trust where the provider allows - it is also possible to hold investments in trust. Example here http://www.hl.co.uk/investment-services/fund-and-share-account/faqs

Do you need professional advice?

As the Trustees of a Discretionary Trust, you and your father have certain responsibilities towards the beneficiaries - simply shoving the money into a non-interest bearing account could be regarded as bad stewardship.

http://www.crippslaw.com/guidance/a-brief-guide-for-trustees.pdf

See also http://www.hmrc.gov.uk/trusts/trustee/responsibilities.htm - it is very important to understand the type of trust you are administering and its tax treatment.

http://www.ybonline.co.uk/business/our-products/savings/notice-account/notice-account-for-trusts/

http://www.caterallen.co.uk/term-deposit-account-for-trusts

https://www.shawbrook.co.uk/news/shawbrook-bank-launches-new-charity-and-trust-savings-account

The above links may be worth a look.

jonesMUFCforever

I know that Cater Allen do trust accounts.
I know that Halifax do not but Lloyds do.

henm2

HSBC will also do Trust accounts. Treated as a type of business account but usually on community account free banking terms. The details are a bit buried away on their web site but here is the link

http://www.business.hsbc.co.uk/1/2/business-banking/business-bank-accounts/community-account

pinkglitter80

Thanks for the replies. It all looks very complicated! This may well be a stupid question but what are the benefits of a discretionary trust over opening either a normal savings account in my name to only be used for the children, or savings accounts for the children?

xylophone

Thanks for the replies. It all looks very complicated! This may well be a stupid question but what are the benefits of a discretionary trust over opening either a normal savings account in my name to only be used for the children, or savings accounts for the children?

(from my mum's inheritance)

In your first post you seemed very sure that a discretionary trust was required.

What exactly did the will say?
If you are not sure how to handle the matter and particularly if there is a large sum involved, you might be well advised to consult a solicitor experienced in wills and trusts? http://www.step.org/online-directory

pinkglitter80

Sorry yes I should have clarified - the will didn't actually cover this at all. Under the will everything went to my Dad and he has decided that this sum should go to the grandchildren based on conversations he had had with my mum (her death was v sudden and she hadn't got round to updating her will). So legally we're not obliged to do it. The solicitor advised the best mechanism was a discretionary trust.
Thanks

dzug1

pinkglitter80 wrote: »

Thanks for the replies. It all looks very complicated! This may well be a stupid question but what are the benefits of a discretionary trust over opening either a normal savings account in my name to only be used for the children, or savings accounts for the children?

The beneficiaries have more comeback on you with a trust should you mismanage or run off with it


A savings account 'in your name' is yours and you can do what you like with it with little or no comeback.


If Dad 'doesn't like' Natwest perhaps he should suggest somewhere else he does like.


But if a sizeable sum is involved you should be looking beyond a trust account (on which the interest will be pitiful) for investment. An IFA should help

xylophone

If you have a solicitor, he should be able to advise you concerning trusts (or be able to refer you to a solicitor expert in the field).

It might be possible to execute a Deed of Variation of your mother's will such that part of her assets is willed direct to each of the children.

Depending on how the bequests were left, it might then be possible for you and your father to hold the cash in bare trust for each child until he/she reached the age of majority - 18 (or 16 in Scotland)

Cash accounts of various kinds can be held in bare trust - you would need to check with the account provider. With regard to any R85, be aware that if it were desired to continue to hold any account in bare trust after the age of 16, the R85 would need to be rescinded and any tax overpaid reclaimed on form R40.

You might prefer to consider investments other than cash.

If you do not wish the children to have access at the age of majority then some form of Discretionary Trust would be required - see previous post and be aware of the tax treatment.

Do your children have CTF/JISA? Might your father prefer simply to make the maximum contributions to these for the children each year?