Can assets held in trust be removed from the UK?

Goose_Grass

Can assets held in-trust be removed from the legal jurisdiction if the beneficiary emigrates? 

Or would a choice have to be made between either a final distribution of the assets outside of the trust vs. creating a new trust that paid income derived from the assets, which presumably could be sent abroad.

Marcon

Goose_Grass said:

Can assets held in-trust be removed from the legal jurisdiction if the beneficiary emigrates? 

Or would a choice have to be made between either a final distribution of the assets outside of the trust vs. creating a new trust that paid income derived from the assets, which presumably could be sent abroad.

What does the trust document say on the matter?

Keep_pedalling

What sort of trust is this? Does the reason for putting the assets in trust still exist?

SeniorSam

If the Trust is a Bare Trust the asset must go to the beneficiary. If it is a Discretionary Trust then it is for the Trustees to decide if the appointed beneficiaries receive the inheritance as they have discretion but it needs to be a good reason to change.

Other types of Trust have different rules so saying a 'Trust' means nothing without knowing what Trust and the wording of it.

If you want more detailed replies then you need to give the details that you wish to achieve and possibly members will be able to help

Goose_Grass

Thank you, all. I had thought the answer would be a flat "no," but it seems more like "it depends." 

There is yet no trust wording, I am trying to discover what is possible and develop some possible scenarios, ahead of meeting a qualified solicitor to write my new will and will trusts. 

My situation is as follows.  Were I to die in the next few years, the bulk of my estate would be my primary home in the UK, the beneficiaries of which would be my spouse (who has no ownership in the house, presently) and my minor children (from my first marriage).  All need adequate provision will have to be made from the house (sale) and death-in-service benefits (a life insurance policy will have paid the mortgage).

While my children will remain in the UK with their father, my surviving spouse is very likely to want to leave the UK to live with their children abroad.  Where I might otherwise be minded to gift my spouse a life-interest in the property, I was concerned that this would not be very practical, or indeed possible, if they left the country.  In such a case I had thought of several options, but I wanted to start by establishing whether such assets could cross border yet remain in trust. 

I believe some of you commented on an earlier question I had about cross-border assets and were most helpful, I am glad to see you both again.

Keep_pedalling

I understand the trust for your children but why put the share you leave to your wife in trust?

You are assuming that your spouse would leave the UK after your death, but that might not be the case so you could give her a life interest in your children's share of the house with the condition that the life interest trust ends if she leaves the UK. 

Goose_Grass

Thanks @Keep_pedalling

I was thinking of the trust for my spouse because they do not (yet) have any ownership of this house.  They have their own assets, which at some point in the future they may invest in my house in return for a share, but this is not yet the case. 

In the meantime, they have assets and my minor children have none. So I thought that leaving them a transferable life-interest in a share of the house would provide for them adequately (to the tune of half-a-house), yet ultimately leave the value of the house as an asset for my children (half now, half later).

I may misunderstand trusts, and/or adequate provision.

SeniorSam

When you do seek a solicitor, make sure that it is a solicitor that is STEP qualified, as they have additional qualifications that incorporate Trust work. Many solicitors do not have these extra qualifications and although they do draw up Wills, in your situation it would be a mistake to instruct someone under qualified in a complex situation that may well need to involve Trusts.

Take your time to fully understand the way any Trust suggested actually works and the duties and obligations of the appointed Trustees.  If you have family members that you could trust to be Trustees, then that would be better than appointing professionals, where their costs could be very high for them to act as Trustees, although some very complex estates involving property abroad may benefit with a professional despite the costs..

Goose_Grass

Yes, @SeniorSam, STEP qualifications all around, for sure.  I'm using a large, well-resourced firm. 

Making it a bit less complex for me: estate will be under IHT threshold, even with the life insurance inside it (and I believe it could be removed from the estate with yet another trust...).

Making it more complex: I'm an immigrant, too, which means I don't have a pool of UK-based family members to call upon for trusteeship or executorship.  For example, my ex-spouse will be a trustee for the children's inheritance (and probably for yet another trust to age 25).  This isn't necessarily a bad thing - my ex is competent and would take the duty seriously - but I really don't have a choice. 

By that token, I wouldn't want my children's trustee (i.e. my ex) to think they could claim on my surviving spouse's inheritance on the basis that the children should have gotten more.  I want to write a well-advised will that discourages that thought.

To speak to @Keep_pedalling's comment above, my new spouse would undoubtedly leave the UK if I were to die in the next five years, as they have no meaningful connections here besides me.  I am very grateful they came to the UK because they love me, and I wouldn't want them penalized for wanting to be with their children if I died before them.

Overall I recognize my situation isn't easy. 

Keep_pedalling

Goose_Grass said:

To speak to @Keep_pedalling's comment above, my new spouse would undoubtedly leave the UK if I were to die in the next five years, as they have no meaningful connections here besides me.  I am very grateful they came to the UK because they love me, and I wouldn't want them penalized for wanting to be with their children if I died before them.

Overall I recognize my situation isn't easy. 

In which case I would avoid putting any of her inheritance in trust. You will can give her the right to stay put until she has moved back to her own country. This is not as complicated as you think and I am sure your solicitor can reassure you of this.

Goose_Grass

Thanks @Keep_pedalling, that is a simple option that I am considering.  I would need my solicitor to reassure me that such a residual distribution to my new spouse does not deprive my estate of assets that my children need, or is open to likely challenge on those grounds.  This may be a matter of percentages at the end of the day, which is easy enough. 

I just want to take care of them all as best I can with sensible planning.