Trust accounts can be beneficial for a variety of scenarios—whether you're a professional looking to manage assets on behalf of clients or a family member looking to reduce inheritance tax.
One of the most important steps is to select a trust bank account that's tailored to your needs. Whether you're on the hunt for easy access to funds or high-interest on savings, low fees or quality customer service, this guide is for you. We've hand picked the best services for trust accounts to help you find the perfect solution for your trust's needs.
3 Best Banks for Trust Accounts
| Name | Score | Visit | Disclaimer | |
|---|---|---|---|---|
 | 9.5 | Visitcomparewealthmanagers.com | ||
 | 8.8 | Visitmetrobankonline.co.uk | ||
 | 8.5 | Visit |
Best for Finding Tailored Trust Account Services – Compare Wealth Managers
Best Trust Account Offered by a High Street Bank – Metro Bank
Best Trust Account for Customer Service – Cater Allen
1. Compare Wealth Managers – Best for Finding Tailored Trust Account Services
ELIGIBILITY REQUIREMENT | None |
|---|---|
KEY PERKS | Services for retirement, investment, inheritance and much more |
MONTHLY FEE | £0 (any professionals you choose to use will have their own fees) |
REGULATION | FCA |
While Compare Wealth Managers doesn’t offer trust accounts itself, it can connect you with professionals and companies that do.
If you want to set up a trust to leave something to your loved ones without leaving them an unexpected tax bill, then this is something that Compare Wealth Managers can help you with. One of the company’s specialties is providing assistance in tax and inheritance planning.
Other areas of expertise include retirement planning, investment management, private banking, wealth management, and independent financial advice. If you decide you want professional help, Compare Wealth Managers will make recommendations tailored to your specific needs.
And the best part? The service is completely free!
- Easy online process
- Impartial recommendations
- Free to use
- Accessible for all experience levels
- Services are provided by third parties
- The recommended services may cost more than high-street bank accounts
- The company works with a limited pool of professionals
| Name | Score | Visit | Disclaimer | |
|---|---|---|---|---|
| 9.5 | Visitcomparewealthmanagers.com |
2. Metro Bank – Best Trust Account Offered by a High Street Bank
Eligibility Requirement | 16 or over, UK resident |
|---|---|
Key Perks | Monthly interest, online banking, cheque book |
Monthly Fee | £5 per month for balances below £25,000 |
Regulation | FCA, PRA |
If you want the familiar and accessible services of a high street bank, then Metro Bank is pretty much your only option. Whether you're an individual trustee or a firm, you'll be able to talk to Metro Bank's dedicated team of trust specialists 24/7 for expert advice.
The trust account comes with free transactions and provides 0.2% AER interest paid monthly. There's also no monthly fee if the account balance is above £25,000. You'll have access to online banking, as well as a cheque book.
You can apply for a Metro Bank trust account in store by providing a certified copy of the trust deed and identity verification for everyone associated with the account. There's a one-off account opening fee of £150.
- Transactions are free
- You can bank online or by phone 24/7
- You can earn interest at a rate of £0.20%
- Expert advice is available from 'The Trust Centre'
- £5 monthly fee for balances below £25,000
- You must pay a fee of £150 to open an account.
- No debit card or lending facility.
| Name | Score | Visit | Disclaimer | |
|---|---|---|---|---|
| 8.8 | Visitmetrobankonline.co.uk |
3. Cater Allen – Best Trust Account for Customer Service
Eligibility Requirement | You must be introduced by a professional adviser registered with Cater Allen. You also need to be a UK registered trust, 18 or over, and only receive deposits originating from within the UK. |
|---|---|
Key Perks | Internet banking, accounts that pay interest, dedicated support team |
Monthly Fee | None |
Regulation | FCA, PRA |
Part of the Santander group, Cater Allen has been delivering private banking services for over 200 years. It offers trust accounts tailored to different needs. The Reserve Account for Trusts is a current account that provides instant access and up to 30 debit transactions a month. Alternatively, you can earn interest on your trust's funds with a Fixed Term Deposit Account or Business Notice 35 Account.
Whichever account you opt for, you'll benefit from Cater Allen's extensive experience of managing trust accounts. You can reach out to their dedicated support team for a professional and friendly service. There's also an Internet Banking service where you can monitor all your accounts and manage payments.
Cater Allen provides a top-level, exclusive service, so naturally one of its drawbacks is that it's less accessible than other options. To be eligible for a trust account, you'll need to already have another account with Cater Allen, or be introduced by a professional adviser who's registered with Cater Allen. Your application could be declined without explanation, especially if you don't provide enough information.
- Variety of accounts for trusts.
- Over 200 years of experience.
- No monthly fees.
- Monitor all accounts through Internet Banking.
- You'll need to be introduced by a professional adviser if you don't have a Cater Allen account already.
- You won't be eligible if you receive deposits from outside the UK.
- Fixed-term savings accounts for trusts have a minimum deposit of £85,000.
| Name | Score | Visit | Disclaimer | |
|---|---|---|---|---|
| 8.5 | Visit |
How Do We Rate & Review Banks?
We consider a variety of criteria that are important to users when we select and review the best banks to ensure we show you the most appropriate services. Here are some of the things we look at:
Regulation: We have considered banks that are regulated by appropriate authorities such as the FCA as well as PRA, and with funds covered under the Financial Services Compensation Scheme.
Product offering: We strive to review a variety of products to ensure there is something for everyone. We therefore covered both current accounts and savings accounts for trusts, as well as more tailored services.
Interest rate: We looked at how much interest banks pay on trust accounts and selected competitive options.
Account perks and features: We looked for extra features that will make your banking experience more pleasant, such as online banking and cheque books.
How Does a Trust Bank Account Work in The UK?
A trust account is a type of bank account designed to hold assets or funds on behalf of a trustee. There are several steps to consider when opening a trust bank account in the UK which are listed below:
A trust is created by an individual called a Settlor. This Settlor transfers the funds or assets into the trust and then specifies the terms and conditions of the trust, the beneficiaries, and the trustees.
Once you have established the trust, the trustee opens a bank account in the name of the trust. The trustee needs to provide relevant identification documents and trust deeds to open the account.
The trust bank account requires the trustee or beneficiaries to be authorized signatories. These individuals have the power to sign cheques, make withdrawals and carry out transactions on behalf of the trust.
Trustees have to keep accurate records of all the transactions which are related to the trust bank account.
Trust bank accounts have tax implications in the UK. Trustees have to comply with the regulations and report their income, gains, and any tax liability to the HMRC.
The funds in the trust bank account must be transferred to the beneficiary according to the term stated in the trust deed.
What Is a Trust?
A trust is a legal financial arrangement where one person known as a Settlor transfers funds or assets to another person called the trustee. The trust is established through a legal document which is called the trust deed or trust agreement.
A trust provides a flexible and versatile legal structure for managing and protecting funds and assets, ensuring their proper distribution according to the Settlor wishes.
The cost of opening a trust varies, depending on several factors that include the complexity of the trust and the professional fees involved. You will have to pay legal fees to an experienced lawyer who will draft the trust deeds and provide legal advice throughout the process.
There is a wide range of assets that can be held in a trust in the UK. You can hold cash in various currencies, residential homes, commercial buildings, and any other real estate can also be held in a trust. Moreover, a trust can also hold a wide range of investment options such as stocks, bonds, mutual funds, dividend stocks, and some other securities.
The eligibility criteria and requirements for opening a trust vary. Here are some general requirements.
The Settlor must have legal capacity, must be of sound mind, and at least 18 years old.
The Settlor must also select one or more trustees to manage the trust. The trustees must be willing and able to fulfil their fiduciary duties and responsibilities.
The Settlor must make sure the purpose and objectives of the trust are clearly defined as well as the terms and conditions.
There must be certainty of intention, subject matter, and objects to establish a valid trust.
A trust must comply with the rules. You may consult with a trust specialist to ensure that all legal and regulatory requirements are met.
Why Open a Trust?
Different people have different reasons they want to open a trust. These reasons may be affected by their circumstances and objectives. One of the reasons for opening a trust can be estate planning.
A trust will allow the individual to control the distribution of assets after their death; thereby ensuring that their wishes are carried out and also potentially minimising estate tax and probate fees. A trust will also provide for a smooth transfer of assets to its beneficiaries and help to protect family wealth across generations.
Several factors must be taken into account when considering a trust. These factors include the amount to be left in the trust and the potential tax implications. It is also essential to note that trust rules can be complex; therefore, it is very important to seek guidance from a qualified financial advisor before coming to any decision.
The nature and size of the assets you intend to transfer into a trust are important factors to consider. Substantial assets such as significant investments, valuable property, or a business may need a trust for efficient management and protection.
Trusts are subject to complex legal and regulatory frameworks. Working with a financial advisor who specializes in trusts will help you to navigate the complexities and ensure compliance with the applicable laws and regulations.
Trustee Responsibilities
A Trustee has significant responsibilities and fiduciary roles to fulfil. It is the trustees' role to manage and administer the trust assets for the beneficiaries in accordance with the term of the trust deed.
When we say a trustee has a fiduciary duty, what we mean is that the trustee must act in the best interest of the beneficiaries and manage the trust with impartiality. This role requires that the trustee prioritises the interest of the beneficiaries above their own.
Furthermore, a trustee is responsible for the day-to-day running of the trust, maintaining accurate records, managing assets, and ensuring compliance with legal and regulatory requirements.
Types of Trusts
There different types of trust which include:
Bare Trusts
Also known as simple or nominee trusts. This is a common type of trust arrangement in the UK. The legal ownership of assets is held by a trustee on behalf of the beneficiary in the bare trust.
The trustee, in this case, has no discretionary power or control over the assets and is obligated to act solely according to the beneficiary's instruction. In a bare trust, the trustee is a nominal or bare legal owner, while the beneficiary has the right to all of the trust's capital and income at any time if they're over 18 (or 16 in Scotland).
Interest In Possession (IIP) Trusts
This is a type of trust where the beneficiary has a right to receive income that is generated by the trust asset but not the ownership of those assets. The beneficiary in this type of trust is also known as the life tenant; he or she has a fixed entitlement to receive income during a specified time or for a lifetime.
Discretionary Trusts
This is a trust arrangement where the trustee uses his or her discretion to distribute the trust assets among a group of beneficiaries. The trustee determines when and how to distribute the trust or whether to reinvest. The trustee has significant control over what to do with the trust. It is important to abide by jurisdictional provisions when setting up a trust.
What Are Trust Accounts?
A trust account is a bank account that can be used to manage funds held in trust. One or more trustees will need to authorise any transactions associated with the trust account.
Why Open a Trust Bank Account?
A bank can hold funds in trust in a specialised bank account. This can simplify things such as making and receiving payments with the trust. Funds held in a trust bank account will also typically be insured up to £85,000 by the Financial Services Compensation Scheme.
Banks may offer different types of trust accounts to meet different needs, such as current accounts for easy access or fixed-term savings accounts for generating interest on locked-up funds.
Also, trustees are responsible for reporting and paying tax on behalf of the trust, which will likely be easier with a trust bank account. A trust bank account helps the trust ensure transparency and effective asset management.
How to Open a Trust Account
Choose a bank or financial institution that is reputable and offers a trust account that meets the needs of your trust.
Make sure you have your documents ready including trust deed, identification documents, beneficiary information, tax identification number, or other documents that your bank or financial institution requires.
Schedule an appointment with your chosen bank to open a trust account. Complete the application and give accurate information.
Talk to a professional for advice and let him or her review all the documents and agreements to ensure everything is correct.
Deposit the trust's funds into your trust account and review the account terms and conditions carefully.
The Bottom Line – Are Trust Accounts Worth It?
This is dependent on your financial circumstances, family demands, and ambitions. Trusts are helpful for planning what happens after you die; they help you plan for the "what ifs" that may happen in your lifetime like an ailment or disability. You also have control over how your assets are transferred.
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