Children's Inheritance

xylophone

https://www.skipton.co.uk/savings/childrens-savings-accounts/childrens-trust-saver

Might be a solution - you could open one for each child and release for the benefit of the child at age 17 if required.

The interest rate is not brilliant but might do.

poseidon1

https://forums.moneysavingexpert.com/discussion/comment/81962130#Comment_81962130

OP, this is a particularly unfortunate and ill advised trust provision for such tiny amounts.

The requirement to accumulate trust income until each legatee attains the age 21 vesting age, creates potential annual trust income tax liabilties at 45%.

This is because since the trust does not qualify for either Bereaved Minors or 18 to 25 Trust treatments ( your husband was not their father), the onerous tax regime for discretionary trusts that accumulate income applies instead.

Seems to me your husband could not have possibly foreseen such an outcome when he requested this provision, and the solicitor did not flag this as a potential circumstance probably because they were unaware ( not all solicitors are versed in trust taxation).

Bearing all the above in mind, in my view you should avoid income generating investments and the bothersome income tax and record keeping that comes with it.

As an alternative I suggest you explore life company Investment bonds. The following article summarise the benefit of investment bonds as non income producing growth vehicles for trusts which avoid onerous administration and annual tax compliance -

https://connect.avivab2b.co.uk/adviser/articles/tech-centre/investment-and-tax-planning/personal/investment-bonds-trusts-in-wealth-transfer-strategies/#:~:text=Investment%20bonds%20can%20play%20a,%2C%20family%2C%20or%20legal%20representatives.

However I would observe that others on this forum when faced with a similar inconvenient trust vesting at age 21 in relation to small legacies, have in ignorance of the correct position, treated such trusts as if they were just Bare Trusts. They did not account for any trust income tax, and ignored the age 21 requirement and handed the accumulated funds over at age 18. One could see this as a pragmatic although incorrect solution.

Keep_pedalling

https://forums.moneysavingexpert.com/discussion/comment/81962130#Comment_81962130

The children are not residuary legatees, they only received a fixed sum so that clause does not apply to those bequests (was this will drawn up by a solicitor?).

Parents only have control over JISAs until the children are 16 and the money can’t be withdrawn until they are 18 (even in Scotland)

poseidon1

https://forums.moneysavingexpert.com/discussion/comment/81963492#Comment_81963492

Good point which I missed. It is unlikely that husband gave a share of his estate residue to his nephews to the detriment of his own immediate family. Far more likely to be fixed sum legacies.

Has the OP quoted a clause that has no application at all to the fixed sum legacies of £8k, and therefore read the operative trusts for the nephews completely out of context?

We need to see the specific clauses appertaining to the £8k legacies in their entirety, to determine if my analysis was correct.

DRS1

If there is a bequest to minor children you would expect to find an infant receipt clause in the Will. However that usually says the parents can give a valid receipt for the money going to their child. Clearly that was not what the OP's husband wanted to happen so maybe the residuary language was linked instead - eg clause x shall apply to these bequests.