Solicitors for Trustees

Help for solicitors to set up Trustee accounts.

Setting up Trust Accounts is a challenge

To set up a trustee bank account, you must first establish a trust by creating a trust deed, appointing trustees, and naming beneficiaries. Then, you will need to open the account by providing the bank with the trust deed, identification for all trustees and beneficiaries, proof of address, and the trust’s registration number from the tax authorities, such as the UTR or URN.

Before opening the account

• Establish the trust: Draft a formal trust deed that outlines the terms of the trust, including who the trustees are and who the beneficiaries are.

• Appoint trustees: Choose your trustees and ensure you have their consent.

• Identify beneficiaries: Clearly name all beneficiaries in the trust deed.

Register the trust: Register the trust with the relevant tax authority, like HMRC TRS, and obtain a Unique Taxpayer Reference (UTR) or Unique Reference Number (URN).

Opening the bank account

• Gather necessary documents: Collect the trust deed, government-issued identification for all trustees and beneficiaries over 18, and proof of address for each.

• Complete the application: Fill out the bank’s trust account application form, which will require details of the trust and all key individuals. The application form must be signed by all trustees.

• Provide the registration number: Include the trust’s registration number (UTR or URN) on the application.

• Submit the application: Submit the application and all supporting documents to the bank.

Wait for approval: The bank will review your application and may perform electronic checks. The account may open immediately or after a few days, depending on the outcome of these checks.

This is a lot of work. Trust and Charity work with Trustees and their solicitors and do all this work for you.

Why Solicitors should use this service

What are the challenges you face as a solicitor:

Mainstream banks often possess limited knowledge on the topic. This can be time-consuming, and you may not feel entirely confident that they can provide the information you require.

You must contend with individual trustees who unintentionally create an issue by opening bank accounts in their personal names, which could jeopardise the trust funds with their personal assets.

When investments are held in trust and dividend income or proceeds from the sale of these investments are disbursed, the funds must be deposited into an account registered in the name of the trust, rather than in the name of an individual trustee.

You are obligated to remain compliant with the Solicitor Regulatory Authority (SRA) regulations concerning Client Money and Client Accounts. For instance, according to SRA guidelines, solicitors are prohibited from using their client accounts as ‘bank accounts’ and should not retain client funds unless there is a corresponding transaction.

Unless solicitors are acting as trustees themselves, they should refrain from utilising client accounts, and even then, only for short-term purposes.

You may find yourself needing to manage trust cash to ensure that no more than £85,000 is held with any single financial institution or bank, thereby ensuring that all funds are protected by the Financial Services Compensation Scheme (FSCS).