Transferring estate funds from executor account to trust

getmore4less

Yorkshireman99 wrote: »

My point is that a trust is not necessarily lay the best vehicle for what the OP wants to do. A wide range of investments to provide an income for the OP's father would be far more effective tax wise that a trust. Trusts are not the manic bullet that many believe them to be.

A trust is just a wrapper around assets, much the same as an ISA is just a tax wrapper around assets like cash shares funds etc.

The trust is not an investment vehicle.

The trust is there the will created it and decided what assets should be in it, that is what the testator specified

You keep telling people they have to follow the requirement of wills are you now changing your mind?

It is not clear what type of trust the will specifies or who the potential beneficiares are, if none are minors it may be possible to DOV the trust away or discolve it at some point in the future but that may defeat the object of the trust which was to protect the asssets from the dad.

The terms of the trust will determine the scope of investments and distributions etc.

The OP mentions minors and £80k, not clear if these are part of this trust or a seperate one for the £80k mentioned.

fazza1970

getmore4less wrote: »

A trust is just a wrapper around assets, much the same as an ISA is just a tax wrapper around assets like cash shares funds etc.

The trust is not an investment vehicle.

The trust is there the will created it and decided what assets should be in it, that is what the testator specified

You keep telling people they have to follow the requirement of wills are you now changing your mind?

It is not clear what type of trust the will specifies or who the potential beneficiares are, if none are minors it may be possible to DOV the trust away or discolve it at some point in the future but that may defeat the object of the trust which was to protect the asssets from the dad.

The terms of the trust will determine the scope of investments and distributions etc.

The OP mentions minors and £80k, not clear if these are part of this trust or a seperate one for the £80k mentioned.

Thanks to all who've replied (been on the road all day - not ignoring you!), and hope I haven't created any friction between anyone.
From all the info you've put forward, it's clear a Trust in itself is not the way to go if we are expecting any sort of yield on whatever funds are left in it (or even if we are hoping for those funds to maintain value).
Basically, the money to be set aside for my father is simply to cover his living expenses above and beyond what is covered by his private and state pensions. I should perhaps have mentioned my sister and I hold PoA over his affairs (at my late mother's insistence and his happy agreement, as he simply doesn't do "money) and that he isn't in good health. In other words, although the interest due on those funds will go to him, it is not much of an issue for us.
Equally, up to two-thirds of the funds in the trust would be withdrawn pretty much straight away, probably via deeds of representation, again removing emphasis from the issue of poor interest.
Clearly, the children's trusts are something we would like to see accrue value (though I had a sense from reading elsewhere that the 25th birthday landmark won't hold up in law). While one of the grandchildren is 16, the others are 12, 7 and 3, so the prospect of that money dwindling in real terms is troubling.
I'm also pretty clear now that simply asking HSBC to switch my executor account to a trust account seems a non-starter even if they were likely to offer a trust account offering semi-decent interest (which they're obviously not).
At present, I'm inclined to investigate whether there is anything to prevent us from simply (again, perhaps by deed of representation) removing that money from the trust and placing it elsewhere to earn (slightly) better interest, or even invest it in a property.
The encouraging thing is that the lawyer I'm seeing next week is an expert in trusts who comes personally recommended.
Now, I'm filling in the various paperwork to ensure our mother's half share of our parents' house (for which my father is life tenant and he and we wish him to remain as long as he can) passes to us as trustees in legal title and that the land registry is updated.
Joy!!

Yorkshireman99

getmore4less wrote: »

A trust is just a wrapper around assets, much the same as an ISA is just a tax wrapper around assets like cash shares funds etc.

The trust is not an investment vehicle.

The trust is there the will created it and decided what assets should be in it, that is what the testator specified

You keep telling people they have to follow the requirement of wills are you now changing your mind?

It is not clear what type of trust the will specifies or who the potential beneficiares are, if none are minors it may be possible to DOV the trust away or discolve it at some point in the future but that may defeat the object of the trust which was to protect the asssets from the dad.

The terms of the trust will determine the scope of investments and distributions etc.

The OP mentions minors and £80k, not clear if these are part of this trust or a seperate one for the £80k mentioned.

Of course the executors have to follow the will but there are many kinds of trusts and some imaginitive thinking as the OP has said in post #13 can be invaluable. In fact the executors hold all the estate assets on trust anyway. It does illustrate that phrasing a will too tightly can cause effects quite different from what was really needed.

SevenOfNine

Yorkshireman99 wrote: »

With respect going to several solicitor and IFAs sounds supiciously like you were looking for someone who agreed with your own ideas rather than seeking objective advice. Sadly a not uncommon, and well intenioned, way of doing things. No trust is watertight and it is very well established law that no trust can restrict payment beyond 18. It really is an archaic concept that should not be used anymore.

With respect YM99, your assumptions are way off the mark. I did not say we saw several IFAs, we saw ONE, he was advising long term investment which was not what we were looking for.

STEP solicitor no.1 dawdled in to our appointment in his shirtsleeves, no tie, half his shirt buttons undone so his greying hairy chest was on display. To every question I put to him he said "well, I can if you like", at one stage when I asked him to clarify a point he sniggered & said "you're really not getting this are you".

Forgive me if I decided I did care not for his overly casual, condescending attitude & tone, therefore chose not to take up his services.

Step solicitor no. 2 gave first class advice on the whole, pros & cons for many scenarios & options for us to consider & supplied an extensive written report on our meeting......& charged practically by the minute, VERY expensive, & I mean VERY.

We took everything she said, expensive but thorough advice, tailored what we initially thought we wanted with what would be feasible, fair, do-able & no ongoing expense to run, & went to a less expensive STEP solicitor, negotiated a fixed fee, & she completed the task with the legal paperwork. Draft 1, 2 & 3. She was not available for final questions & witness signing as she'd gone on long term sick, so we were passed to a similarly qualified colleague with our agreement. He suggested a minor change & supervised our signing, acting as witness.

Contrary to your assumption that we were "looking for someone who agreed with our ideas", we were not bouncing around professionals like a pair of nitwits, we were putting all the pieces of the puzzle together, ensuring we understood all aspects of it BEFORE deciding how best to achieve a suitable outcome.

This, in the end once everything was clearer, WASN'T to create a discretionary trust, or any trust, & so we chose not to do so & took a different decision.

You, I'm positive, are fully aware there is NO LAW which prevents a trust from succesfully restricting distribution of funds to an age beyond 18, so you really should stop saying that. It is dependant on what type of trust & how well it is set up that determines how watertight it is.

It's misleading to keep quoting a non existent law!

Yorkshireman99

SevenOfNine wrote: »

With respect YM99, your assumptions are way off the mark. I did not say we saw several IFAs, we saw ONE, he was advising long term investment which was not what we were looking for.

STEP solicitor no.1 dawdled in to our appointment in his shirtsleeves, no tie, half his shirt buttons undone so his greying hairy chest was on display. To every question I put to him he said "well, I can if you like", at one stage when I asked him to clarify a point he sniggered & said "you're really not getting this are you".

Forgive me if I decided I did care not for his overly casual, condescending attitude & tone, therefore chose not to take up his services.

Step solicitor no. 2 gave first class advice on the whole, pros & cons for many scenarios & options for us to consider & supplied an extensive written report on our meeting......& charged practically by the minute, VERY expensive, & I mean VERY.

We took everything she said, expensive but thorough advice, tailored what we initially thought we wanted with what would be feasible, fair, do-able & no ongoing expense to run, & went to a less expensive STEP solicitor, negotiated a fixed fee, & she completed the task with the legal paperwork. Draft 1, 2 & 3. She was not available for final questions & witness signing as she'd gone on long term sick, so we were passed to a similarly qualified colleague with our agreement. He suggested a minor change & supervised our signing, acting as witness.

Contrary to your assumption that we were "looking for someone who agreed with our ideas", we were not bouncing around professionals like a pair of nitwits, we were putting all the pieces of the puzzle together, ensuring we understood all aspects of it BEFORE deciding how best to achieve a suitable outcome.

This, in the end once everything was clearer, WASN'T to create a discretionary trust, or any trust, & so we chose not to do so & took a different decision.

You, I'm positive, are fully aware there is NO LAW which prevents a trust from succesfully restricting distribution of funds to an age beyond 18, so you really should stop saying that. It is dependant on what type of trust & how well it is set up that determines how watertight it is.

It's misleading to keep quoting a non existent law!

Noted and I apologise. The extra details give an entirely different picture. The first one in particular behaved appallingly. Re the age restriction AIUI, from my own, admittedly non STEP solicitor, who confirmed to me that this cannot be enforced. I would be interested to know how it can? Does it still get included on "it has always been done" principle and do people just accept it perhaps?

SevenOfNine

Thank you YM99, I clearly lost my temper (sorry)!

A previous discussion on MSE of where a trust involving 'age' had failed in court was not a discretionary trust (which is the only type I would ordinarily comment on, having precious little knowledge of the workings of other types), the result/ruling had a 'notation' regarding discretionary trusts, but the whole thing, though it may be considered to have set a precedent (regarding whatever type of trust that was), it is certainly not law.

What we chose does include an "age 25", loosely disguised as a stipulation, but we are absolutely aware that if our grandsons want this money at age 18, a legal challenge by them would have an even chance of succeeding (& probably better than that), therefore we have entered into it knowing that whenever they want it, we'll let them have it. We have to have some faith that they will have some maturity even at 18 & it's theirs to do whatever they wish even if we don't approve.

OP sounds like he has some definite ideas of what he wants to achieve, supply the solicitor with a clear list, what, whom, growth, tax, what should happen if the absolute worst occurs & any minor/s don't reach maturity to take their share, discuss ongoing administration (HMRC, time, expense). So many variables & stuff you won't have thought about to think about! It was helpful that every scenario I put forward, the solicitors subsequent notes of the meeting addressed all the pros/cons, as she had AT the meeting but one can only digest so much.

The word 'trust' isn't one size fits all, the type depends on various circumstances one wants to cover, & definitely isn't the one & only solution, or necessarily the first choice solution.

Good legal and good financial advice - everyone agrees on that.

Yorkshireman99

No problem! It was being too blunt which is my Yorkshire heritage coming out. No offence taken by me. Life is too short and the important thing is that people get helped. I entirely take your point that conflicting advice from professionals can be hard to deal with. Likewise the numerous possibilies sometimes, (often?) make it hard to choose.