Are executors in modern wills considered to be acting as Trustees?

RetiredandHappy

In 2020 I generated a will through LegalWills.co.uk. This is a "solicitor approved" web service with a good Trustpilot rating. I now need to alter my will and am debating using the same arrangement. I was generally happy with the service but my doubt is over the fact that the wording of the will mentions Trusts rather a lot.

"I appoint X, Y and Z to be Executors and Trustees of this my will"

"... my trustees means those of my executors who obtain probate and the Trustees for the time being of any trust arising under this Will."

"I give all of my Wealth ... to my Trustees to hold on trust"

I don't think my parents wills (I was an executor) mentioned trusts at all, though I can see that they were trusting me with their money and trusting me to disburse it correctly. So clearly trust is a big thing in appointing executors.

So the wording of my existing will may just be a cover all legal phrasing that is perfectly normal for a modern will. In support of this, I discovered a sentence in an HMRC guide saying that trusts associated with wills do not need to be registered at all if they last less than 2 years. (exact wording was more complex)

The fear is that the 0% band for house inheritance tax only applies if the house is passed "directly to my children". If it goes into a genuine trust, then it may not apply even if it then is passed on to my (adult) children.

So my questions are does the wording in the 3rd quote establish a formal independent trust different to the normal position of an executor in relationship to the task they have to perform and is this perfectly normal wording for most modern wills or is it something to be careful about.

doodling

Hi,

You need to distinguish between a trust that is intended to have a life unrelated to the executorship and a trust that exists as part of the execution of the will.

The moment someone with a will and executor dies, their property becomes owned by the executor, in a trust on behalf of the beneficiaries.  That is something that happens automatically.  That is why the words executor and trustee appear to be used somewhat interchangeably in wills.

To answer your question, a lot depends on the wording that follows the quote  If the intention is to refer to the normal executors trust that exists on death then you are fine.  If however the wording implies that the trust should exist longer than it takes for the executor to do his work (i.e. it is intended to create a separate trust) then I would recommend legal advice.

Note that in the case of a main property then if the trust is in favour of a spouse and includes a right to live in the property (an Immediate Post Death Interest (IPDI) trust) then you are fine - the beneficial ownership is what matters and that stays with the spouse.