Holding money on behalf of estate beneficiary

[tstanley1]

Hi all,

We are the executors for a small estate with 4 beneficiaries.

The estate proceeds have been distributed to three of the four beneficiaries.

However, the will specifically asked for the money for one of the beneficiaries to be held and controlled entirely by the executor - with money released to the beneficiary on an as-and-when basis. This is because the beneficiary involved has issues managing money. So, we typically transfer money to the beneficiary to help with rent and genuine living costs.

My question is this: We currently hold this money in a separate savings account (in my name). Legally, do we also have to ensure the beneficiaries name (in ‘Trust’) is on the savings account, or will holding it in a normal savings account in my name be sufficient? We are keeping thorough track of any outgoings, and the account is solely used for holding this money.

Many thanks for any advice!

[EnglandPi]

You have followed the correct process.

Assuming there is more than one executor but the account is managed by one executor, what would be the procedure if anything happened to the managing executor?

[tstanley1]

Good question - I plan to amend my will shortly, and part of this will contain a statement regarding this account (with management falling to the other executor).

so just to confirm: The beneficiaries name doesn’t need to be on the account at all -and I’m simply able to continue distributing the money as required from a savings account held in my sole name?

Many thanks again

[EnglandPi]

Correct

[des8]

Of course if the account is in your name you (if an income tax payer) will be paying income tax on the interest, for which perhaps the beneficiary isn't liable.

You say you are leaving instructions in your will.. don't forget as the account is in your name HMRC will expect it to be accounted for in the IHT report made by your executor.

You appear to be one of the trustees of a discretionary trust set up by the will
You need to keep minuted records of trustee meetings and produce annual accounts
HMRC might need to be informed of the creation of the Trust, with yearly tax returns

Your duties also mean you must comply with the trust's terms, act in good faith and the best interest of the beneficiary
Failure to carry out your duties (breach of trust) leaves you personally liable

[tstanley1]

Thank you both

DES8 - Thank you - Yes, I certainly understand my responsibilities as a trustee, but my main concern was that the account that is physically holding the money is not a formal trust account with the beneficiaries name of it (I.e. one of these: https://www.bathbuildingsociety.co.u...rust-accounts/) - and is rather a basic savings account at Barclays in my name. My query was basically is this allowable.

Many thanks again

[des8]

Trustees are the legal owners of any funds or assets held in the trust, and as such may hold them in any legal manner they wish (bearing in mind their fiduciary duties and the settlors instructions).

[tstanley1]

Thanks everyone for your replies, much appreciated!