UC and being a house trustee

blackstar

Hello all,

Anyone here with knowledge of trusts and UC? As I would most appreciate if anyone can answer my below questions please?

My mother has a House trust with two friends as trustees. Hiwever the two trustees do not want to do it anymore and my mum has asked if I can be a co-trustee with the Solicitor? I will also be a 50% beneficiary to her house/assests at the point of her passing when it will then go into a discretionary trust as stipulated in her will.
My questions are:

1. If she adds me as a co-trustee with the solicitor in the house trust will it affect my UC? I will not have access to the funds while in the house trust and she is still here.
2. Will I still need to declare this information to DWP either way if I become a co-trustee of her hoise trust? If so how? On a money, savings and investments declaration is there a box to tick for something like this? Or how do I declare it? Any links to any UC guidance on this?
3. I have a good understanding of the discretionary trust which my 50% will be put into on her passing which I will be a trutee with the solicitor. I will also be an executor of her will. I understand what needs to be clear in the writing of the discretionary trust as solicitor has explained this.
4. I am Autistic myself and in receipt of DLA. Is there maybe a better trust that a discretionary trust that my share could be put into in terms of UC or is just a regular DT fine? Ive heard that a discretionary trust is no longer suitable for someone on UC? Even if worded well? Is this true?and that onky a carefully worded disabled persons trust is suitable for UC? Is this true?

The solicitors advice is it doesnt matter if she leaves it in the house trust or takes it out but has advised to have it written in her will to have her assets immediately put into a discretionary trust with me as co-trustee with the solicitor. Not sure if thats good advice.

elsien

is the solicitor STEP registered? If so, they should know what they’re doing.

HillStreetBlues

https://forums.moneysavingexpert.com/discussion/6657445/uc-and-being-a-house-trustee

I'll only answer the first 2

1. Being a Trustee doesn't affect UC, as it's not your money/property it's the Trust.
2. No, there is nothing to declare because of number 1.

Keep_pedalling

How did this trust come about? There is a big difference in a trust that may have been created by your father’s will or one where the house was put in trust by the owners in their lifetime. Being a trustee does not effect your benefits but it is not a role to take on without a good understanding of the type of trust you are taking on and your responsibilities are going to be with regard to the beneficiaries and HMRC.

blackstar

https://forums.moneysavingexpert.com/discussion/comment/81904584#Comment_81904584

IIm Not good with complex things at all. Hmrc erc...would be out my understanding and find stressful

Really dont want to be a trustee at all..but whi else can she ask? Is there any other option?

She set up the housing trust 7 years ago before the passing of my father 5 years ago.

Can my mother simply not just jave the sole solicitor as trustee and not me.

Would that have a bad effect on me?

What would be the point in me being a trustee when I will tell the co solicitor to do all the work anyway?

MMy Mother said wluld I be the executor too? But is that comlex too?

Keep_pedalling

https://forums.moneysavingexpert.com/discussion/comment/81904844#Comment_81904844

Unfortunately, your parents putting their own home in trust has added unnecessary financial complications to what otherwise would normally be straight forward, and this is really going to hit home if she ever needs residential care or on her death.

There were sharks out there selling these useless trusts by creating fear around IHT and residential care costs. The problem is it does not help with either of those issues because it will be treated as deliberate deprivation of assets as far as care costs are concerned and as a gift with reservation of benefit for IHT purposes.

There is no obligation on you in becoming a trustee.

blackstar

Thanks

A few questions if I may please for anyone who maybe able to help?

1. Can my mother simply not just have the sole solicitor as trustee for her current house trust and for the discretionary trust after she passes and executor and not me and no one else? Just the solicitor for all those things?

2. Would that have a bad effect on me if she did that for my 50% part of the assests? And if so how.?

3) What would be the point in me being a trustee and executor when I will tell the co solicitor to do all the work anyway?

4) being the executor too is a bit complex too is it?

Thanks all

Keep_pedalling

https://forums.moneysavingexpert.com/discussion/comment/81905181#Comment_81905181

1. Yes that would be possible.
2. No
3. Can’t really answer that
4. Normally it would not be, but the trust makes everything far more complex and her executors are going to need professional advice on wind up the trust. If the current solicitor was the one who sold this to your parents then you the advice should come from elsewhere, specifically a SPEP solicitor qualified to deal with trusts.

blackstar

Thanks.

My mother is in the NIL band.

Hiw about this set up?

My mother leaves house in house trust and has just the solicitor as trustee.

Then writes into the will.that upon her passing my 50% share goes into a discretionary trust and myself and the solicitor are co-trustees.

She said the solicitor said I can do as little or as much as I want as a co-trustee. I would likley have solicitor do everything or most. This way I wouldn't need to worry about admin and legal stuff.

My mother said she felt uncomfortable having only the solicitor as a sole trutee for discretionary trust. Is that logical? I dont see why it would be anything to worry about.

My mother also said she would like me to be co-executor with solicitor. Again solicitor sid they would do as much as I asked them to do. So I didnt need to worry about anything complex or legal.stuff

In terms.of my UC would that be safe based on the above and the discretionary trust worded correctly in terms of my UC?

Any advice appreciated. Thanks

blackstar

We have been thinking amd tallkng about t.amd have come to this conclusion and would appreciate if others think his maybe a good plan.

Mother has a home very modest value.

She has had it in a house trust for 7 years and can prove she put it in the house trust for administration reasons ie dealing with probate fast etc..not for any care avoidance reasons. She was in good health at the time. My father was not at the time and passed 2 years later.

I think she should keep it in the house trust with the solicitor as sole executor as if she scraps the house trust she would have no reasonable arguments to avoid care costs if she went into care. Plus keeping it in the house trust she does have a fair chance of it not being used for care costs if needed.

Then she said she will write in her Will that my 50% share goes into a discretionary trust upon her passing. And the discretionary trust will have only 1 trustee, the solicitor as there is no one else and I would find it too stressful to be a trustee. Plus I am on UC and would also be a beneficiary, even though as advice above said this is not an issue, it would just be one less Autism based worry for me.

Then she would also have the executor as the solicitor only.

She is worried though as she had read stories of Solicitors who were the sole trustee not being honest with the funds and if I was trustee that would minimise any risk of that. Which I see why she's worried about that but I dont think its likely to happen and coupd still happen even if I am co-trustee..but I really would rather not be co-trustee as would find it stressful having to sign documents and mot understanding what they meant and having to waste money on the solicitor explaining every sentance.

So thats what we have cone up with so far.

Would.others say based on what ai have said thats probably the better option?