Trustees and their duties

The position of a trustee is a responsible one. Trustees are the legal owners of the trust fund and hold the fund for the benefit of others so trustees must behave within the rules laid out for them in the trust document and in legislation.

Interpreting the intention behind the trust document is fundamental to a trustee being able to successfully discharge his or her duties to the beneficiaries and exercise his or her powers appropriately.

While all trustees must meet a minimum standard of behaviour, if a person can be attributed with additional knowledge because of their profession (a solicitor for example) the duty of care of that person will be correspondingly higher.

Some of the main functions that a trustee must perform are:

  1. Exercising a power of investment. The investments must be suitable for the type of trust and the trustees must consider investment diversity.
  2. Seeking proper advice from someone that the trustee believes is qualified to give that advice.
  3. Implementing a trustee investment policy where the process of advice has been delegated.
  4. Reviewing arrangements in place with third party advisors.
  5. Reviewing the objectives of the trust and minute decisions stating reasons why decisions have been made and for whose benefit.
  6. Keeping accurate accounting records.
  7. Submitting tax returns to report income receipts and capital gains where compliance rules dictate.
  8. Retaining an impartial position between the beneficiaries and understanding what information can be exchanged with them.

At Beswicks Legal we have a complete understanding of these duties and responsibilities and can either advise existing trustees on how to carry out duties and interpret the trust terms or we can act as trustee.

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