Our Private Client Department has a wealth of experience helping clients set up a Trust. Our team are on hand to provide expert legal advice that is specific to your individual needs. Our team will work with you to find the best solution and discuss the different options available.

There are many reasons to create a Trust so one or more of the following may apply to you. A Trust is particularly useful if you have children who are under 18 and need looking after, should something happen to you.

There are various types of Trusts that have been designed to meet different kinds of needs dependant on your individual requirements. The type of Trust you use will be dependent on who the beneficiaries are, what the assets are and how you wish them to be distributed.  The main types of Trusts are: 

• Fixed Trusts, in which the beneficiaries are named and their share is set by the Trust document. By its name, there is no flexibility here. Also referred to as Bare Trusts.
• Protective Trusts. A Trust created by the Trustee Act 1925 and is designed to protect wealth from being wasted by bankrupt or spendthrift beneficiaries.
• Discretionary Trusts. A Trust created by someone to allow the Trustees complete discretion in how to pay out income and capital to the beneficiaries whose entitlement is not fixed like it is for a Fixed Trust. 
• Trusts for Disabled Beneficiaries, which are discretionary Trusts with special tax exemptions for beneficiaries who are disabled.

The role of Trustees

Trustees are the people who hold the assets on behalf of the beneficiaries. This means that they are the legal owners of the assets covered by the Trust, and must manage those assets in the best interest the named beneficiaries, for example, your children. In other words, they are owed a personal and individual duty to the Trust to act in its best interests. The duties and powers of Trustees are defined by law, and include the following:

• The duty to act in accordance with the rules of the Trust.
• A statutory duty of care to the Trust’s beneficiaries.
• The power to make investments for the benefit of the beneficiaries.
• The duty to review investments regularly and take appropriate expert advice on how best to manage them.
• The duty to make payments from the trust and to pass the assets to the beneficiary in accordance with the instructions you have set out in the trust deeds.

Appointing Trustees

If you choose to establish a Trust in your Will, you must appoint Trustees. In most cases, if established by your Will, these will be the same as your Executors. If created during your lifetime then these will be trusted, friends or professionals. If you are also appointing guardians for your children in your Will, there can be some benefit in appointing one of the guardians as an Executor and Trustee.

In all Trusts, you can appoint between two and four Trustees. In selecting Trustees, ideally you will be looking for someone you know, who has the following characteristics:

• Trustworthy and honest
• Over 18
• Not a bankrupt, or former bankrupt
• Has no criminal record
• Can be reasonably expected to outlive you (if appointed by your Will)

You may choose to appoint professionals such as a Solicitor as alternative Trustees in your Will, who would take on the responsibility if your original intended Trustees pass away.

There is a lot of information to consider and important decisions to be made when deciding on what type of Trust to use and who to appoint as your Trustee. We pride ourselves on the personal service we deliver. A member of our team will be allocated to you and will work with you from start to finish.  They will get to know about you and will work with you to ensure that you are provided with the best legal advice and help identify the best option for your individual needs.

Universal Wealth Preservation, which deals with Wills, Trusts and asset protection, has been in the news lately, in particular, BBC’s Money Box programme on Radio 4. 

Lamb & Holmes Solicitors is acting for a number of people in relation to Universal Wealth Preservation. If you have Wills or Trusts or other arrangements in place with Universal Wealth Preservation and are concerned or need advice, please contact our Kettering office on 01536 513 195. Lamb & Holmes are offering a free review for any Universal Wealth Preservation customers in the Northamptonshire area.