The trustee’s basic role
Legal title to trust assets is vested in the trustees, while beneficiaries have rights defined by the trust. A trustee therefore has to separate personal interests from trust responsibilities.
Read and follow the trust document
The trust deed or Will trust sets out who can benefit, what powers the trustees have and when capital or income can be distributed. Trustees should not assume that because a decision feels fair it is authorised.
Act in the beneficiaries’ interests and avoid conflicts
Trustees owe fiduciary duties. They should identify conflicts of interest, avoid using trust property for personal benefit unless properly authorised and document important decisions.
Manage investments and property prudently
Where the trust holds investments, cash or property, trustees need an appropriate management process. Depending on the trust and assets, professional investment, tax, property or legal advice may be appropriate.
Keep accounts, records and tax information
Trust administration can involve bank records, valuations, minutes or decision records, tax returns and Trust Registration Service obligations. The precise requirements depend on the trust.
How trustees make decisions
The trust instrument may specify how many trustees must act and how decisions are taken. Co-trustees should communicate clearly and not allow one person to run the trust informally without authority.
Can a beneficiary also be a trustee?
Often yes, depending on the trust. But conflicts can arise, particularly where a trustee is one of several potential beneficiaries. Good drafting and careful decision records become especially important.
Frequently asked questions
Can a trustee refuse to act?
A person who has not accepted trusteeship may be able to decline. Once appointed and acting, retirement or replacement must follow the trust document and applicable law.
Can trustees be paid?
Professional trustees may have a charging clause or other authority to charge. Lay trustees do not automatically have a general right to profit from the role.
Do trustees own the trust assets?
They hold legal title in their capacity as trustees, but must deal with the assets for the trust purposes rather than as their own property.
Can trustees change the beneficiaries?
Only if the trust gives a power that permits it or another legal route is available. Trustees cannot simply rewrite the trust because circumstances change.
Tell us what you want to achieve
You do not need to know the name of the legal document or trust before speaking to us. Explain the family, property or planning issue and we can discuss the relevant options.