FAQs

That will depend on a number of factors and your objectives for the trust. Some Trusts provide for beneficiaries to have an entitlement to an income for life, a right to occupy a property, or a fixed share of the trust fund at some stage in the future; some discretionary types of trust are very flexible and allow the Trustees to determine, from time to time and in the light of changing circumstances, the most appropriate provision for the beneficiaries.

With a few limited exceptions, most trusts need to be registered with HM Revenue and Customs, even if they do not receive any income or capital gains. It is the responsibility of the Trustees to register the trust and to maintain the trust’s register with updates if anything changes, such as the death or retirement of a Trustee. Some very simple trust situations, such as co-ownership of land for multiple parties, or a parent holding an investment for a minor child might be caught be the registration rules.

Some trusts can be varied, either with the agreement of all of the beneficiaries, or by the Trustees exercising the legal powers given to them to alter the terms of the trust. Examples of such variations might be changing the beneficiaries or their entitlements, changing the age when a beneficiary inherits, or bringing the Trust to an end earlier than planned. Varying a trust can have both legal and tax implications, and the trust terms might stipulate that a specific number of Trustees must agree to this course of action or that a deed must be prepared.

This can be a complex area of the law. If a Trustee no longer has mental capacity to act, then it might be possible for them to be replaced or removed as a Trustee. Whether this can be done and how this is done depends on a number of factors, including the terms of the trust, if there are any other Trustees, and the nature of the trust’s assets. Even if the incapable Trustee has made a Lasting Power of Attorney, it might not be possible for them to be removed or replaced without a court order.

The legal document creating the trust (whether by deed or will) will stipulate when the trust will end. That might be when a beneficiary reaches a particular age or passes away, or it might be when the Trustees decide to bring the trust to an end. When a trust comes to an end, it may be that a deed needs to be prepared, and there are often legal and tax implications for the Trustees to consider before proceeding.

No one can be compelled to act as an Executor of someone’s estate. Acting as an Executor can sometimes be time-consuming, complex, and burdensome. You are legally responsible for ensuring that the estate is administered in accordance with the law. If you do not wish to act, you can choose to renounce your position. Alternatively, you can choose to have ‘power reserved’, which enables you to step aside as an Executor without fully renouncing in case you wish to engage in the estate administration at a later date. Another option might be for you to appoint someone as your Attorney to step in and administer the estate on your behalf.

Yes, you can decide to give away all or some of your inheritance to your children or to any new beneficiary of your choice. As to how you do this and when you do this will depend on a number of factors. A Deed of Variation signed within two years of the date of death can have retrospective treatment for Inheritance and Capital Gains Tax purposes so that the deceased (and not you) is treated as making the gift. You can give away an inherited asset or a cash amount, or create a new trust for yourself and your children in a Deed of Variation.

A Grant of Probate applies to an estate when someone passes away and has left a valid Will. There are many rules that exist that influence when a Grant of Probate is required but as a very general rule where there is property, savings or investments in the name of the deceased, those assets cannot be dealt with (as in sold or accounts closed) until a Grant of Probate has been obtained from the Probate Registry. Sometimes banks and savings institutions will release the funds they hold without a Grant of Probate but each organisation has its own rules. Quite often the home of the deceased will be held jointly with their spouse or partner and the deceased’s share will pass automatically to the surviving owner without the need for a Grant of Probate. This depends upon the type of joint ownership and advice should be obtained to make sure the title of the property is updated.