Running a Trust

jameswardle

Hi everyone 

Do you have any experience of running a Trust you can share with me.?

My mother who was my brother's carer passed away last year and left her house and some shares in her will to A  Discretionary trust.

I'm the trustee of this trust and my brother is the beneficiary, we have just gotten probate, and now I need to work out what I do and dont put in the trust. to provide for my brother.

Do you have any suggestions on how best I can fund things for my brother?
Any tip for not paying too much tax.  Trusts seem to be a minefield?
Any suggestions for a good Solicitor or Accountant who is experienced in running trusts for a vulnerable adult?  I have a solicitor but they are not experienced enough and I'm going to change.

Thanks

James

janer1967

Hi and welcome glad you have reached out for help this must be a minefield 

I dont really know who to signpost you to for help 

Maybe CAB could help 

I hope other members will be able to give you more advice 

endowarrierqueen96

Keep daily records. I recommend a electronic spreadsheet which is updated monthly or weekly of all ongoing costs. Failing that, try keeping a finance diary of expenses etc for any specialist equipment, special needs childcare and so on.
Alternatively you can jot down all the costs on a empty blank Word document and print off two copies each week. Make a note of what goes in and comes out of your main bank account too. Colour code finances, for example medical expenses blue, school related fees are in red, yellow denotes childcare fees, and green is for all the other stuff like new furniture. That way you can monitor your expenditure.
See what the monthly trends are and so on. Store all important finance paperwork in a lockable safe for your peace of mind. Always make double copies in the event of a unwanted robbery or power failure. Best of luck. 

TemplarEP

Hi there. I notice you posted this a while ago. I always recommend using a professional trustee in conjunction with relatives or people you trust. The costs aren't that high and could save you a lot of money or tax in the long run.

jameswardle

Thanks, Everyone for the feedback

In the end, I took advice from https://www.renaissancelegal.co.uk/.  who are specialist Solicitors and this helped greatly with  the trust planning (such a radically different and better experience to my original solicitor)

I found an experienced IFA Craig Harwood at https://choicefinancialsolutions.com/ who provided very good advice for trust investments to minimise tax costs and met the investment needs of my brother.  We have purchased an offshore bond, which sounds a bit scary but is basically like an ISA for trust from standard life in Dublin.

Finding a Bank was reasonably hard,  in the end, Barclays were the "easiest" and most cost-effective to set up a trust bank account with

I chose not to use a Professional trustee, and two family members have agreed to act as trustees, (we are a bit unusual perhaps as one of us is a solicitor (not a trust specialist) and the other experienced in financial modelling). I can see a professional trustee can be the right answer for many people but its important to find a good one.

I think the one thing I've learned from all this is that if you are not getting good advice and support from your solicitor get another one! 

TemplarEP

Really glad to hear you've found the solution you're looking for. 

You've made a good point, being a solicitor yourself, the need to use a specialist in trusts or estate planning. We have had many clients come to us after having bad experiences with some solicitors. Some feel obliged to stick with their one or the one that drafted the will.

Best wishes,

David

Templar Estate Planning

lapple

Hi this post is very useful, although I have lots of questions still. We have paid a fee to a will writer, who recommended a trust company. I've since read Mencap advise using a solicitor. I had questions and the trust company want to charge silly fees to answer. Is there a correct approach? Are trusts transferable for example if one doesn't like the company? 

lapple

Guess I work for local government and help people free of charge, and it's a whole new world charging £200 an hour to families when you are trying to help people who are less fortunate in the long run. ?

TemplarEP

I would always recommend using a professional trustee if using trusts to receive assets on death. This ensure that the trust is run correct, legally and all reliefs are claimed. Costs do not need to be excessive. Be wary of solicitors charging hourly fees.

You would need a trustee meeting on death and then at significant events, such as a further death or property purchase/sale in the future, but not often - it could be 10 years + before you need another one. Telephone ones of these would be about £250+VAT. This ensures everything is set up correctly and then decides how the trust should operate going forwards, such as how to invest or if income from a property should be paid to a certain person/s. Some further legal work may be required, depending on what was decided. Ongoing costs should only be as an when needed, such as a deed to mandate income or to take a loan from the trust, which would be typically £150+ VAT ish. There are ongoing costs associated with running a trust, but these are to ensure the protection afforded by a trust, typically protection against:

·         Inheritance Tax or Generational Inheritance Tax

·         Long term care fees

·         Marriage after death

·         Divorce of beneficiaries

·         Creditors and bankruptcy

If you don't like the Professional Trustee, you can normally change.

lapple

My father has gone through a will writer to set up a trust with a company, but since I'm now reading to go through a solicitor. The trust company want to charge extra for answering my questions, which is expensive and seems odd. Is there a correct process?

jameswardle

@lapple. All I can say based on my experience that if you are not happy with the service you receive you should change.   Paying renaissance legal almost £400 to review my plans and propose a good way forward is easily the best £400 I have ever spent.   Like you, my previous solicitor was very expensive and borderline incompetent.   If you know two people you trust my personal view is not to appoint a solicitor, company etc. as a Trustee,  but to only engage them to help running the trust as a legal advisor. I would have two individuals you know and trust who are a similar age to the beneficiary to be trustees.    (of course, everyone experiences and situation is different)