At Protopapas LLP our team is able to offer expert advice, guidance and understanding in relation to Trusts. We are also often appointed to act as professional Trustees. Trusts can be complicated. Creating a trust involves more than simply drafting a trust document and arranging for it to be signed. There are many aspects to consider before creating a trust including what assets are going to form part of that trust and who will be the trustees. You will also need to consider the purpose of the trust and if there are going to be minor and/or disabled beneficiaries.

The Settlor

The Settlor is the person who creates the trust. A trust can be created by either an individual or a company (if it is permitted to do so). Generally, a Settlor must:

  • have mental capacity and
  • be over 18

There are other factors which must be taken into account such as the Settlor’s financial status at the time of making the trust and the reasons for making the trust. The trust may be at risk of attack if the Settlor is creating the trust whilst going through financial or marital difficulties or if the Settlor does not actually intend on giving up control of the trust assets.

A trust can also be made by a will and come into force on the death of the testator (the person who made the will).

Types of Trusts

There are various types of trusts and you must ensure that you establish the correct type. Some common types of trusts include:

  • Bare Trusts
  • Life Interest Trusts
  • Discretionary Trusts
  • Relevant Property Trusts
  • Disabled Person’s Trust
The Beneficiaries

The Settlor will clearly need to identity the beneficiaries of the trust and they must be properly and adequately identified in the trust document.

The Assets

The trust assets must be clearly described in the trust document. Furthermore, the Settlor must make appropriate arrangements for the assets to be transferred into the trust once it is established.

The Trustees

The Settlor will have to carefully consider who will be responsible for day-to-day trust administration (such as dealing with income from a rental property). While trustees are responsible for managing a trust, they do not necessarily carry out all, or even any, of the trust administration tasks personally. Both corporate and individual trustees may want to employ trust administrators who may be in-house, as is common in the case of corporate trustees, or professionals such as solicitors or accountants.