We have the knowledge about trusts and trustees responsibilities, not just the investment capability running trust portfolios

Whilst the Chancellor of the Exchequer and the Treasury are clearly of the view that trusts exist for no reason other than to avoid tax, that is a mistaken view.

Trusts serve many different purposes but chief amongst them is to protect the assets contained within them, or to make sure that the wishes of the person setting up the trust continue to take effect, perhaps long after that person has died.

The multitude of reasons for a trust mean that notwithstanding the sometimes unattractive tax treatment, trusts nevertheless get created. This will usually be the function of a solicitor who will advise on the powers to be given to trustees, the directions that can reasonably be contained within a trust, and deal with the various legal aspects regarding the management of the trust.

However, the trustees then face an additional, and prospectively heavy, responsibility – that of investing the assets in the trust having regard for the aims and ambitions of the trust, the likely time horizons, the risk factors that may or may not be acceptable, and whilst this will generally be set out in a trust strategy statement, implementing a policy and maintaining it perhaps over an extended period of years requires a detailed understanding both of the nature of the trust and the laws governing it, the tax treatment of it and selecting appropriate investments and in due time, changing them, hopefully realising a profit for the benefit of the trust and its beneficiaries.

Whereas the creation of the trust clearly falls within the ambit of solicitors, the management of the investments contained within it is a regulated activity and must be carried out by a firm and person who meets the requirements of the Financial Conduct Authority and for this reason, most solicitors will refer trustees of a new trust to an appropriately qualified person.

A good many referrals come in our direction largely because in addition to being regulated for investment activity, we also have staff with qualifications and experience in the management of trusts and estates and who therefore can take account of the nuances of each trust and hence hopefully manage the trust assets to better effect.

A new element to our service is the setting up of LEI’s (Legal Entity Identifier), which we have done for all the trusts we currently look after in-house. We can extend this service to other trusts we currently do not look after.