BUSINESS - ADVERTORIAL TOP TEN TRUSTEE TI P S
Gavin Faber, Will Trust and Estate Disputes Partner at Irwin Mitchell Private Wealth, explains the role of the Trustee.
The appointment as a trustee is a serious but potentially rewarding office. I have condensed my experience of helping trustees into a list of top ten things that trustees ought to consider.
Familiarise yourself with the trust and its history • Request copies of the governing document(s). • Identify any co-trustees, beneficiaries and trust assets. • Consider the nature of the beneficial interests. • Understand the purpose of the trust and consider any wishes expressed by the person who set it up.
• What powers does the trust document give the trustees and are any statutory powers excluded/amended?
• Are there key dates which may require you to take advice and/or action?
Don’t be a silent trustee • Be involved in the decision making. • Keep in contact with your co-trustees – this helps decision making and keeps all informed.
• Remember that trustees must act unanimously (unless otherwise permitted).
Be aware of your legal duties • Fully appreciate the onerous legal duties placed upon you, particularly the duty to take reasonable care (which takes account of specialist skills you may have).
Consider seeking appropriate professional advice • It is advisable for trustees to seek professional help. • Specialist trust lawyers and accountants can help to ensure historic and continued compliance with administrative aspects including self-assessment tax returns, Inheritance Tax reporting (exits/10 Year anniversaries) and preparation of trust accounts.
• Check that recently introduced compliance requirements are being dealt with (e.g. HMRC’s Trust Register, FATCA/CRS).
• Ensure that best use is made of available tax reliefs and exemptions
• Have the trustees complied with their investment duties? • Don’t be afraid to challenge professional advice - a trustee can be held personally liable.
Record trustee decisions and keep copies of correspondence • Record trustee decisions and resolutions.
Gavin.Faber@IrwinMitchell.com
• Keep safe all trust documents, letters of wishes and correspondence.
• Review all arrangements regularly to ensure that they are still appropriate.
Consider disclosure requests by beneficiaries carefully • Who is requesting the documents • What is their interest in the trust • Will disclosure prejudice the interests of the other beneficiaries?
• Discuss disclosure requests with your co-trustees and guard against disclosing minutes of trustee meetings,agendas or correspondence between trustees.
Undertake regular reviews • Does the trust still serve a purpose • Have there been any significant changes to the beneficiaries – deaths, births, incapacity, serious illness, financial difficulties, divorce?
• Consider the nature and performance of the trust’s assets – are they still suitable for achieving their purpose(s)?
Communicate with the beneficiaries • Regular communication with the beneficiaries ensures that you have an understanding of their circumstances and needs.
Be aware of any potential conflicts of interest • Being a director of the business and also a trustee holding shares in the business or a competitor brings potential for conflict.
• Familiarise yourself with the constitution of the business and terms of the trust - are there powers which enable the director/trustee to manage the potential conflict?
Do not profit from your position • What does the trust say about expenses? • Unless specifically authorised, trustees should not profit from the trust.
Irwin Mitchell Private Wealth can support you, your family and business with these important decisions and obligations. Exploring your options can go a long way and allow you to have clarity, peace of mind, and focus on the important things in life.
Contact Gavin on DDI: 0121 203 5366 or Phone: 0370 1500 100 Extension: 5366 @WillDisputes_IM
www.irwinmitchell.com
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