Trustee Bank Accounts for a Minor

getmore4less

theoretica wrote: »

As security guy says, I think your solicitors are wrong. Or there is a miscommunication about what a day to day expense is (food maybe, school trips no). This site http://www.thewillsite.co.uk/legal_wills_uk.php says that "the Trustees decide what income and/or capital can be used for the benefit of the children e.g. school fees."

THat depends on the terms of the trust as set out in the will, AIUI the common way is to keep it discretionary but that is not always the case.

For intestate I am not sure of the defaults as set out in the various acts but I am sure there will be info available with suitable search terms, a but late for me to try now.

getmore4less

This link may be of relevance although needs further research.

http://www.hmrc.gov.uk/manuals/ihtmanual/ihtm42815.htm

and this one discusses minor and 18-25 trusts

http://www.friendslife.co.uk/doclib/ctst49.pdf

So it looks like the finance act 2006 unless superseded may be the source needed and you are looking for information on

bereaved minor trust

I would always try to find more than one place that describes the law as well as possibly reading the act to try to understand th situation.

g6jns_2

Rooibos wrote: »

I assume the bank account for pensions etc is to be used for day to day expenses incurred from now until his 18th birthday. So you can arrange extra sport sessions. holidays etc in the next two years. This will be held in trust with you and sis as trustees

I have been told by all seven solicitors I have so far dealt with that none of the money can be used now for day to day expenses. Shame - that was what I was hoping for. I no longer get my CSA maintenance from ex but, tough, got to get on with it. My son is going on a school holiday in February which, his dad was going to pay half of. I'm definately not allowed to use any of the money for that, I've to pay for all of it while I'm maintenance down .

The bank account for lump sums like the house would be money that he is only given on his 18th birthday and as trustees it is your job to maximise the inheritance in line with the rules of the trust?

But please clarify with the legal team as you need to understand the rules for each trust.

Who write the rules of the trust - some of the correspondence says the trustees do - is that me and my sister, or do they mean the Pensions?

If you have already been told by seven solicitors it is difficult to see how anybody on this forum can help given that none of us have all the details the solicitors have. The subject is not a difficult or unusual one for solicitors to deal with so is there some other complication you have not told us?

getmore4less

One other thing,

No one polices these trusts(except HMRC for tax if they know about it), the trustees are there to do that, in practice the only one that can do anything is the child, if they don't like the way the money/income was spent they can sue the trustees.

One thing you will have to do is start an education program on money management and investments so they are ready to take over at 18, not many get a start in life that can set them up.

For a substantial sum, property could(that's why you need proper advise) be a reasonable investment for the trust so if you have a house and mortgage the trust could buy part of the house and free up cash flow as well as provide security for both of you.

Rooibos

If you have already been told by seven solicitors it is difficult to see how anybody on this forum can help given that none of us have all the details the solicitors have. The subject is not a difficult or unusual one for solicitors to deal with so is there some other complication you have not told us?

I think I have already mentioned I have a complaint in hand because the advice I have received from the five solicitors from the Probate legal team have provided contradictary advice, hence I saw another solicitor locally whose colleague also assisted, but they were unable to clarify either. So if they're confused is it any wonder I am too!

I guess I'm just feeling midered with all the differing bits of information - just wish there was some consistency.

I just wondered if anyone could explain why I've now been advised to open two bank accounts.

A few months ago when I first contacted the legal team it was sugested they have limited Power of Attourney and apply for the Grant that way, which seemed appropriate under the cirumstances i.e it being my ex's estate.

Then 3 months ago I was advised, by the then solicitor, to provide MY own bank account for ME to receive some of the pension funds (I'm named as beneficiary) and for the Grant to be applied for in my name to make that possible.

That solicitor left the company a few weeks ago, and I'm now told I need two bank accounts -one for the proceeds of the house, and one for the pensions (all of which are now to be paid to my son, though no explanation why so far).

Also they are now asking how I prefer for the Grant to be applied for - I don't know!!

It doesn't help that I'm partially deaf so phone calls to discuss with the team are not easy. I know now - if I was going to use a legal team I should have gone local so I could meet face to face.... hindsight is a wonderful thing.

Rooibos

No one polices these trusts(except HMRC for tax if they know about it), the trustees are there to do that, in practice the only one that can do anything is the child, if they don't like the way the money/income was spent they can sue the trustees.

I want to get it right and do everything properly and above board and have been forewarned my son can sue me and my sister, if we get it wrong - eek!

One thing you will have to do is start an education program on money management and investments so they are ready to take over at 18, not many get a start in life that can set them up.

Very good point - I have started talking about this with him.

For a substantial sum, property could(that's why you need proper advise) be a reasonable investment for the trust so if you have a house and mortgage the trust could buy part of the house and free up cash flow as well as provide security for both of you.

Do you mean me have a house and mortgage now? I do have a house and a hefty mortgage. I had to start again after the divorce two years ago.

I have been told though, in no uncertain terms must I use the money to pay off my mortgage, as I must not benefit in any way. I had hoped I could use some of it to pay a bit off as it would mean providing a home for him and, as you say, release some cash which might outweigh the lack of maintenance. One of the solicitors said it was my responsibility, and mine alone, to provide a home etc. So my thought now is to bank it in some way for two years and then hopefully persuade my son to buy a property in two years when he is 18 to rent out.

I'm thinking that in order to buy a property now that me and my sister would need to get the mortgage for the interim two years, which neither of us are in a position to be able to do.

getmore4less

If the grant has not been applied for yet I would seriously consider sacking the current team and finding a new solicitor more local so you can visit.

How have you arrived at you and sis as administrators?

I would also apply for the grant in my(joint with sis) name(s) to maintain control but you may not be comfortable with that yet.

IME even STEP solicitors are not all as clued up as you would hope on trusts especially the tax side.

Is this "team" some probate service or a proper solicitors office.

getmore4less

What about a move into the dads property that the son owns or rent it out?

Although renting it out is not without it's own issues

Why sell if he may need a place in two+ years.

I am beginning to think a well clued up financial advisor may be the solution but finding one of those is probably as hard as finding decent solicitors.

g6jns_2

Just curious why you think STEP members are not clued up on wills and trust when that is their speciality. Surely they are better equipped than the the average High Street firm?

Rooibos

Is this "team" some probate service or a proper solicitors office

It's a nationally recognised Probate Service.