1st October 2018

Prudential: Duty Calls

When ‘running’ a trust, it’s a fundamental duty of trustees to invest the trust fund so that the beneficiaries’ interests (whether in terms of income or capital appreciation) are enhanced. Graeme Robb, Senior Technical Manager at Prudential goes into more detail. 

Trustees’ powers and duties can be neatly categorised between:

• Dispositive - how, and in what circumstances, the trustees are able to distribute trust income and/or capital
• Administrative - how the trust is to be run

When ‘running’ a trust, it’s a fundamental duty of trustees to invest the trust fund so that the beneficiaries’ interests (whether in terms of income or capital appreciation) are enhanced. The duty of the trustees in relation to investment is to use their powers in the best interests of current and future beneficiaries.

Trustees can access a wide range of potential investments. Which particular product, or combination of products, depends on the specific requirements of each trust. Thereafter, trustees from time to time should review the investments and consider not only their suitability but the need for diversification. Trustees only need to consider the need for diversification but they do not have an absolute duty to diversify.

Read the full article here. 

Tax, Trust & ISA