Trust Fund "held upon trust" in a Will

RnK136

Mum's Will states that everything not otherwise specifically mentioned is "The Trust Fund" and this is to be "held upon trust" for my Dad.

As it turns out, an Investment ISA is the only thing that they didn't already jointly own, or isn't specifically disposed of otherwise in her Will.

What does this mean for the money in the ISA going to Dad?

Can we (trustees/executors) sell the holding and give him the money now? or not?

kipsterno1

Does your father already have his own ISA? If he does then you maybe able to transfer the value of your mothers ISA via an ASP mqintaining its tax free wrapper. 

RnK136

kipsterno1 said:

Does your father already have his own ISA? If he does then you maybe able to transfer the value of your mothers ISA via an ASP mqintaining its tax free wrapper. 

Yes, he does have 2 ISAs of his own so I had been reviewing all options of what might be best to do with Mum's ISA fund and saw the topic of APS.

Seems initially complicated (??) but maybe I've just not dug into it enough yet to get a proper understanding of what we'd need to for it.

SeniorSam

To have created a Trust, which the Will automatically did on the death, the Trust fund should be put in an account of the Trustees and used as required by the Trustees for your father. Upon his death, then that fund would pass to the remaindermen who should be mentioned in the Will. Possibly the children?

Question, how was the house owned? If it was as tenants in common (usually half each) then your Mum's half is also part of the Trust fund. If it was owned jointly, then her half past to your father. Do check this out as there are other things that the executors must do to ensure they act correctly.

Usually when a Trust is included in a Will, it is to protect half of the home and it would be unusual that a Trust was included just for a small ISA investment. Do check this and let us know what you find.

RnK136

SeniorSam said:

To have created a Trust, which the Will automatically did on the death, the Trust fund should be put in an account of the Trustees and used as required by the Trustees for your father. Upon his death, then that fund would pass to the remaindermen who should be mentioned in the Will. Possibly the children?

Question, how was the house owned? If it was as tenants in common (usually half each) then your Mum's half is also part of the Trust fund. If it was owned jointly, then her half past to your father. Do check this out as there are other things that the executors must do to ensure they act correctly.

Usually when a Trust is included in a Will, it is to protect half of the home and it would be unusual that a Trust was included just for a small ISA investment. Do check this and let us know what you find.

Yes, the house was owned as Tenants in Common and Mum's half is stated to go to myself and my Brother in trust - but that is mentioned separately to the part about "all real and personal property not otherwise specifically disposed of... is referred to as "The Trust Fund" and states that is to go to my Dad.

This is the sub-section within the part about the house:


Then the separate section completely about "The Trust Fund" to be held upon trust for my Dad:


This isn't all one and the same Trust is it? The beneficiaries are different?

I should point out that my Dad, my Brother and myself are all trustees and executors.

SeniorSam

This is just one Trust created. The first part (6) you have show is how the Trust will be distributed after your Father's death. The second part (4) States that which is being given into Trust. The Trust is automatically created at the date of death.

So, this is a Will that has placed the half owned by your Mother into Trust during your Father's lifetime. Until he dies, the children do not inherit, but on his death, then they will inherit that part of the house and anything else that your Father passes on. It allows your Father to continue living in the property until his death 

The children have to wait and ensure that the Trust is protected by registering your Mothers part of the property in the name of the Trust, so the property ownership would then show your Father as half owner and the Trust as the other half owner until he dies. It is the responsibility of the Executors to ensure that this happens and the Trustees duty to protect that and any other asset in the Trust for the benefit of your father.

Should your father wish to move, perhaps to a smaller property, then any excess of capital is also to be protected in Trust for your father's use until he died.

I hope this is now clear, but do ask if you need more.
Sam

theoretica

Have you consulted whoever wrote that will?  My parents' previous wills that had a lot of language about 'on trust' but it was only for as long as it took the executors to sort things out.

RnK136

SeniorSam said:

This is just one Trust created. The first part (6) you have show is how the Trust will be distributed after your Father's death. The second part (4) States that which is being given into Trust. The Trust is automatically created at the date of death.

So, this is a Will that has placed the half owned by your Mother into Trust during your Father's lifetime. Until he dies, the children do not inherit, but on his death, then they will inherit that part of the house and anything else that your Father passes on. It allows your Father to continue living in the property until his death 

The children have to wait and ensure that the Trust is protected by registering your Mothers part of the property in the name of the Trust, so the property ownership would then show your Father as half owner and the Trust as the other half owner until he dies. It is the responsibility of the Executors to ensure that this happens and the Trustees duty to protect that and any other asset in the Trust for the benefit of your father.

Should your father wish to move, perhaps to a smaller property, then any excess of capital is also to be protected in Trust for your father's use until he died.

I hope this is now clear, but do ask if you need more.
Sam

Thank you, Sam.
I think I understand a bit more now about the property side.
There is 2 years to register this Trust with HMRC?
If we need to sell the property to pay for residential care for him, they can only factor his half into a financial assessment I hope?

I was more wondering about the other matters now, like Mum's stocks & shares ISA. Can we surrender this and pass it to my Dad immediately? If not, I don't understand why he couldn't have this now.

RnK136

theoretica said:

Have you consulted whoever wrote that will?  My parents' previous wills that had a lot of language about 'on trust' but it was only for as long as it took the executors to sort things out.

Solicitors who did the Wills for them have retired years ago, unfortunately.

I have got into such a quandry over the terms/language that I am feeling I do need to get a solicitor to review the Will, although I was hoping not to need to do that and handle as much as I can myself.

SeniorSam

Regarding the other assets that your Mum owned. They need to be invested in Trust for the benefit of your Father during his lifetime.  As such an investment should be very cautious, it may be best to encash the investments and open a bank account in 'The Trust of Mrs XXXXX  XXXXXXX' with the names of the Trustees entered so that they can administer the account as required.

When this type of Will was originated, it was to shelter the value of the half property put into Trust. However, in more recent times, the Local Government can sometimes try and claim for care costs if other assets have been used, claiming that the Trust was set up to avoid care costs. If the Will was created many years ago with no thought of care costs in mind, then you may be safe on this, However, your Dads assets would need to be used if he needs to go into care.

getmore4less

That does not look like a ongoing trust for the residual, "absolutely" is the key it goes to you dad.

Unless there is more you left off.

All assets are under the trust of the executor (s) during administration.

Is there any mention of a life interest for the share of the property?