I need a trustee account - well four!

fcltd1

My brother and I are the executor's of my late father's will and he leaves money split across his four grandchildren in trust.

We therefore need trust accounts for the estate to distribute to.

I had hoped I could use Bath BS but they have responded saying they are taking no more applications at present.

Hopefully someone has some suggestions - this is driving me nuts!!!

Thanks in advance

xylophone

First of all, have you determined in what type of Trust the money is left? Bare? Discretionary?

This is very important from the point of view of beneficial ownership and tax.

How old are the grandchildren? Does the Trust Deed allow the Trustees any powers of investment or must the gifts be held in cash?


https://www.gov.uk/trusts-taxes/types-of-trust

http://www.prescient-financial.com/docs/Bare%20trust%20returns.pdf

If this is a simple case of children under eighteen being made an absolute gift (money indefeasibly vested) in the will, and the gifts are to be held in cash, the Virgin Money child account might do - it can be held by the Trustees and the account can retain the Trustee status after age 16 - see here

http://uk.virginmoney.com/virgin/savings/learn/childrens-accounts/

"The Virgin Young Saver account will be automatically transferred into an appropriate adult savings account on 5th April, following the child’s 16th birthday.

We’ll ask you whether you want the account to retain the trustee status."

In theory it should be possible for a fixed rate bond type of account to be held by Trustees for a child but this needs to be checked with the individual society.

It may be possible to hold NS& I accounts in trust.

It is possible to hold a stocks and shares type account in trust for a child.

It is possible to hold an Investment Trust in Trust.

SevenOfNine

It's doing my head in as well!

We are about to change an intestate inheritance of £100k by a Deed of Variation so it will bypass us & go to our 2 grandsons, accompanied by a Discretionary Trust so they will be entitled to the money at age 25 (with trustee discretionary payments along the way as we see fit). The 2 boys will be the only beneficiaries - no-one else will be named (that is how we want it).

It's virtually impossible to find a bank or building society willing to set up a Trust account, (eg John Bloggs, Janet Bloggs, Trustees of the Jimmy Bloggs Discretionary Trust).

Some stupidly suggesting a JISA (Halifax), given the amount it will take 10 years to load £100K into a couple of those. Others (Santander/Lloyds) have suggested opening children's savings accounts - great, then they can help themselves to it all at 16.

A helpful soul on here gave me this link https://www.caterallen.co.uk/reserve-account-for-trusts which might help you as well fcltd1..........but I'd have liked a few more options so we could split this cash up a bit, just can't seem to find any.

At this moment in time we're just looking to park it as a Trust somewhere safe, until 'bereavement brain' ebbs a little & we can consider (& learn about) more profitable choices, though understand that a high % of 'profit' will be lost in tax with this type of Trust. Better than a couple of 16 (or at best 18) year olds p!ssing it up the wall because they would be FAR too young to manage £50k each.

xylophone

You are varying an intestacy to create a discretionary trust.

Do familiarise yourself with the taxation aspects because it is the devil of a job to sort this out if mistakes or misunderstandings occur.



http://www.tolleytaxtutor.co.uk/taxtutor/files/subscriber/personal-tax/uk-trusts-and-estates/lectures/1d03.pdf

https://www.gov.uk/trusts-taxes/trusts-and-income-tax



https://forums.moneysavingexpert.com/discussion/comment/71636235#Comment_71636235

You will see from post 3 above that a poster is suggesting RBS for a Trust current account.

Our family member has a Trust current account with Barclays which many years ago was relatively easy to set up in branch - more recently, when a Trustee resigned, all sorts of communications through some specialised department were required.

It is possible to set up a Vantage Trust Account with HL.

It may well be that a stocks and shares type arrangement would suit you as it appears that your grandchildren are still very young.

SevenOfNine

Thanks xylophone - we've consulted a STEP solicitor & haven't moved anything forward as yet, we still have 14 months to sort it out. The Discretionary Trust is starting to give me a headache! Ongoing investment & tax complications/implications being top of the pain in the butt list!

I'm leaning more & more towards just 'gifting' the money, or more likely doing the DoV,- then worrying about 2 little boys reaching 16 (or 18) & accessing their money.............but of course, it will by their parents problem then.

Thanks for help with links, I'll be sure to read them. Apologies fclts1 for barging into your thread.

Yogamumma

It depends on the wording of the name of the trust, if it's a family trust, for example, you would only need one account. As trustees you will decide at what point the children get the money. So the trust could be, for example, The Hogwarts Family Trust 2016. If you need to open a current account (and you may well do because at some point you will be distributing money) any bank can do this. Finding an advisor who knows what they are doing may be a challenge! It's a simple bank account, both trustees to sign (they are NOT named on the account, just the bank account signatory mandate) no bank cards either. Nat West can do this, as I have done so. I believe Metro can too. Now, savings accounts......there's another matter! Should be the same principle as a bank account but it's amazing how many banks/building societies just say no! If you find one, please post it, it's a nightmare!

dunstonh

Finding an advisor who knows what they are doing may be a challenge!

Advisers dont tend to get involved with bank accounts. It isnt really within their remit.

kidmugsy

OP, it may be little consolation but over the years I've noticed that this is a recurrent problem. Apparently it's partly a matter of branch staff not having a clue, but presumably also some of the banks just don't much want the business.

Guys_Dad

I am a Discretionary Trust Trustee. Metrobank are willing to run current and savings Trust accounts, no problem.

Try them.

uptdale

I am also a trustee of a discretionary trust (set up by a will). The trust has a current and a deposit account with HSBC (which insists on treating it as a business account), and also holds investments with Hargreaves Lansdown.

Some things to be aware of:

1. Cheques have to be signed by all trustees (we have 4), and so do things like letters notifying changes of address, which is a pain if you live in different places.
2. The trust has to file its own tax returns, and pays tax at a higher rate than most individuals.
3. When an income payment is made to a beneficiary, the trustees have to give the beneficiary a certificate showing tax apportioned to the distribution (itself quite a complex calculation). The beneficiary can claim repayment of the tax in excess of his/her own tax liability.
4. There is no free software for preparing trust tax returns (which are different from individual's tax returns). You may need to pay for professional help, if you are not comfortable dealing with the trust's tax affairs yourself.

But the OP's question was about a will which just left shares to four grandchildren in trust. If money is just to be held on behalf of each child until that child is old enough, and then is handed over to the control of the child, things are a lot simpler. That would be a bare trust, so no trust tax returns and everything is treated as the children's money from the start. You should not need a trust bank account. Just about any bank or building society should be able to open an account for the benefit of a minor child (e.g. Barclay's Children's Instant Saver Account).

Heedtheadvice

Uptdale wrote "no free software"......Yes but Taxcalc has an add on and I find the £60 or so well worth it!
Also BOS Instant access savings account has been used for a trust (as advised by the bank:o ) but hardly worth mentioning the "interest"