Q. I am one of three trustees of a trust created in my late mother’s will. I have been advised by the solicitor who drew the trust up that I need to consider whether I need to register the trust to satisfy some new rules regarding US taxpayers? What is he referring to, and do I need to register?
A. The Foreign Account Tax Compliance Act is a piece of US legislation which amazingly affects us here. Under an agreement between HMRC and the Internal Revenue Service, Foreign (to the US) Financial Institutions are required to register by October, and then review and report on assets held by US nationals. Whilst this mainly affects what you would expect to be within the definition of a Financial Institution, it also includes some Trusts. Those affected are mainly those with a professional corporate trustee whose income comes mainly from managing investments, or trusts employing a discretionary fund manager to invest directly in stocks and shares. If the trust has lay trustees, and is invested through pooled investments such as investment bonds or unit trusts, then it is categorised as a “Non-Financial Foreign Entity”, and you do not have to register or report to anyone. You may be asked some further questions by the Financial Institutions providing the investments, as the reporting requirements fall to them, and they are required to review their customers over the next couple of years and report on US nationals amongst their customer base. The legislation has caused some controversy in the “land of the free”, and it is possible it may come under legal challenge in due course. For now, however, it is causing quite a bit of extra work around the world!
Q. I am nearing retirement and have had many different jobs over the years. Some of them have provided pensions but I have lost contact with more than one of the companies involved and I think I may have pension benefits with them. Could you please advise me how I can go about finding these?
A. The Department for Work & Pensions runs a tracing service which is the best place to track down a former occupational or company pension. The best way to access this service is online at www.gov.uk/find-lost-pension However, if you are not online, you can call them on 0845 6002 537 or write to them at The Pension Tracing Service 9, Mail Handling Site A, Wolverhampton, WV98 1LU
Q. My Aunt spent the last few years of her life in a nursing home and I had a Lasting Power of Attorney to look after her financial affairs as she was no longer able to do this herself. I am also executor for her estate. Going through her paperwork I have discovered that she made an investment about 10 years ago into an investment bond which is in her name only but with it is a trust document naming my 2 daughters and my brothers son as beneficiaries. All of them are now over 18. She was a trustee but the other trustee who was her brother is also dead. Who now has the responsibility to deal with the trust?
A. As executor to your aunts estate with no surviving trustees you will now have the responsibility to deal with the trust. I suggest that you contact the insurance company who the investment bond is with to inform them of your aunts death. They will need to see your aunts death certificate, her will naming you as executor and probably the death certificate of the other trustee. As you said that the investment bond was in your aunts name only it will now need to cashed in with the proceeds being distributed to the nominated beneficiaries. If you have any problems at all I suggest you consult a solicitor.
If you have a question you would like Trevor to answer, please email it to: yourmoney@rwpfg.co.uk or post it to Your Money, Rutherford Wilkinson Ltd, Northumbria House, 21-23 Brenkley Way, Blezard Business Park, Newcastle upon Tyne, NE13 6DS.
0191 217 3340
