Riddle: where to get advice please on writing multiple pension polices into trust

[johnedgu]

I have rather a silly number of pension plans - of various kinds - including retirement annuity plans. I would like to assign those policies (about 6) not written under master trusts into a simple single discretionary trust - so that my executors don't have myriad arrangements to manage. Local town solicitors refuse the job - "too specialised" they say. All the companies provide standard forms - mostly similar in the main provisions but very different on details such as period of trust (eg 2 to 80 years!). Where can I obtain professional advice please ie do I look for a solicitor, an accountant...? Thank you. John.

[adi36]

Hi
Try Syd Abraham at PROFCO, profco@btconnect.com he may be able to help you. Regards Adrian S

[King_Maker]

I assume you are referring to the death benefits, as Pension policies are not normally assignable.

If you went to an accountant, a (practicing) solicitor or barrister would still be required to draft the Trust Deed.

[johnedgu]

I understand a pension policy itself is an indivisible thing. A trust deed would assign the policy itself into the (discretionary) trust and reserve the pension benefit to the policyholder (me) and the death benefits to other trustees to be held for a class of beneficiaries (my wife and children) - so taking any death benefits out of my estate. Can anyone confirm this please? Thanks.

[King_Maker]

The death benefits are usually paid out by a discretionary trust via lodging a Letter of Wishes with the Pension Trustees, and are thus outside IHT.

[johnedgu]

Some pension policies are written under "Master Trusts" by the pension companies: others - mainly pre-1988 Retirement Annuity Plans and some early personal pension plans - were not. I have nomination forms in place for those policies I have which are alreay under trust to direct the death benefits directly to my family.

My question on the forum was about pension policies **not** written under trust. I have forms from each company but I want to avoid giving my executors multiple trusts to manage! So I would like to place them all into a single trust. I cannot find a solicitor to advise. Thanks. John

[draftsmann]

What my firm does for pension death benefits is to establish a "pilot trust" with a nominal gift (say £10). The pension scheme member then completes a fresh death benefit nomination form, provided by the pension administrators, to nominate the trustees as the payee of the death benefit.

The main advantage is that if the scheme member dies before retirement, leaving a surviving spouse, the death benefit does not fall into the widow(er)'s estate for IHT purposes.

Before the major changes made to the IHT treatment of interest in possession trusts by the Finance Act 2006, we were establishing a single trust, much as you describe, to "consolidate" benefits where there was more than one scheme. It is now not always appropriate to do that - depending on the values of the pension funds it might be advisable to establish one pilot trust per scheme. This would not affect the cost significantly.

We would be happy to help if so instructed.

Adrian Sacco
The Trust Shop
adrian@thetrustshop.com

[axpoint]

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