A Question Regarding Trusts

the O Reilly connection

I was wondering are trusts legally required to hold separate bank accounts?

For example, if a company is owned entirely by a trust, are dividends to be placed into a trust bank account before they are distributed to the beneficiaries?

Thank you

Peregrinus

No. The trustees have to account for the trust property, but that's a bookkeeping exercise; it doesn't necessarily require a separate bank account. As long as the money is paid by the trustees to those entitled, the route by which it got to them is irrelevant.

Trustees do have an obligation not to mingle the trust property with their own property in a way in which it loses its identity and the interest of the beneficiaries is jeopardised. So it would generally be regarded as a bad practice for a trustee to pay trust assets into his own bank account, that also contains his own money. But if he does that, and if the trust money is then paid out again to those entitled, no wrong has been done and there is no remedy.

There are some circumstances where this is not true, and there is an express legal requirement for a separate bank account. Solicitors, for example, must have a trust account which is separate from the accounts of the solicitor personally or of the solicitor's practice. But that's an aspect of the legislation regulating solicitors, not a rule of trust law generally.

ZoeWilson

nice

the O Reilly connection

https://www.boards.ie/discussion/comment/122533951#Comment_122533951

Awesome. Thank you!