Setting up Trust for Bereaved Child

flubberfig

A close friend of mine recently died.  She has named me as (joint) Trustee for her 13 year old daughter.  Neither I nor the other trustee are legal guardian.
To retain the control that was intended I do not think I can utilise JISA.  I see that HL have suspended the bare trust investing for children service you to Covid.  What other options are available to me?  The bereavement is very recent so we do not know the value of the estate yet, but with life assurances I am anticipating 30k-200k starting investment (the estate is very complex).

Keep_pedalling

flubberfig said:

A close friend of mine recently died.  She has named me as (joint) Trustee for her 13 year old daughter.  Neither I nor the other trustee are legal guardian.
To retain the control that was intended I do not think I can utilise JISA.  I see that HL have suspended the bare trust investing for children service you to Covid.  What other options are available to me?  The bereavement is very recent so we do not know the value of the estate yet, but with life assurances I am anticipating 30k-200k starting investment (the estate is very complex).

What do you mean by retaining control? Wills often state a certain age a beneficiary can receive there inheritance, but often this is not enforceable (and certainly not if it is to be held in a bare trust) and they become entitle at the age of 18 (16 in Scotland). Much depends on the wording of the will. 

xylophone

I would suggest taking advice from a STEP solicitor - he/she would probably be able to recommend an independent financial adviser if required.

https://content.step.org/step-directory

https://www.gov.uk/trusts-taxes/trusts-and-inheritance-taxTrusts for bereaved minors

A bereaved minor is a person under 18 who has lost at least one parent or step-parent. Where a trust is set up for a bereaved minor, there are no Inheritance Tax charges if:

• the assets in the trust are set aside just for bereaved minor
• they become fully entitled to the assets by the age of 18

A trust for a bereaved young person can also be set up as an 18 to 25 trust - the 10-yearly charges do not apply. However, the main differences are:

• the beneficiary must become fully entitled to the assets in the trust by the age of 25
• when the beneficiary is aged between 18 and 25, Inheritance Tax exit charges may apply

xylophone

If this is to be a bare trust, then the beneficiary has the absolute right to access and control at the age of 18 (16 in Scotland).

https://www.gov.uk/trusts-taxes  
If you are not sure about the income tax/ CGT treatment then again take  professional advice.