Should I appoint a trust corporation?

Appointing a trust corporation as an executor and trustee in the UK provides several advantages that often outweigh the limitations of relying on individual trustees.

Louise Igoe, Head of the Private Client team at Lodders, highlights how trust corporations operate, when their involvement might be most appropriate, and the key benefits they can bring to both families and executors.

Challenges for executors and trustees

Choosing who will handle your estate after your death is one of the most personal and important decisions in the estate planning process. It’s natural to turn first to those closest to you, such as family members or trusted friends, who know your circumstances and understand what matters most to you. Others prefer to appoint a trusted professional, such as their solicitor, to handle matters objectively.

Administering an estate or managing a trust is rarely straightforward. Executors and trustees must navigate legal duties, manage finances, deal with HMRC, and communicate sensitively with beneficiaries at a time that may already be emotionally charged. Even with the best intentions, family relationships can become strained when differing opinions arise, or when one person is left to shoulder the administrative burden.

Similarly, appointing an individual professional as executor can raise issues of continuity; if that person unexpectedly falls ill, retires, changes firm, or passes away, responsibility for the trust can become uncertain or delayed. For these reasons, an increasing number of people are turning to trust corporations.

What is a trust corporation? 

Trust corporations are businesses or individual professionals that undertake the administration of trusts and estates and have the power to act as Court of Protection deputy and attorney. Rather than replacing the family’s involvement, a trust corporation can work alongside them, offering impartial guidance and practical support. This ensures that estates are handled efficiently and in accordance with the law, while also protecting loved ones from potential conflict or personal liability.

How does a trust corporation work?

As an example, Lodders Trust Corporation (sometimes referred to as the ‘LTC’) is an independent trust company which is wholly owned by the partners of Lodders. It was set up in July 2022 to provide a more streamlined, centralised, and sustainable client service.

The LTC can be appointed to act as executors and trustees, attorneys and deputies as well as independent administrators (in the event that appointed executors or trustees are removed by the court or choose to stand down). It is essentially a non-trading company and does not have any employees.

In practice, the LTC engages Lodders to undertake legal work on its behalf where it has been appointed to act. A limited number of senior members of Lodders can take decisions and sign documents on behalf of the LTC.

Advantages of appointing a trust corporation

Appointing a trust corporation rather than an individual means that there will always be someone available to act; progress will not be delayed by the availability of any one named individual. This can help provide more efficient management and administration service for clients. A trust corporation can:

• Act as an executor, trustee, deputy or attorney instead of a named solicitor; however, it cannot be appointed as attorney on a health and welfare lasting powers of attorney – this remains the responsibility of an individually named partner
• Ensure continuity of service should a partner retire or leave
• Avoid delays in matters when a partner is on holiday or absent for other reasons such as illness
• Act alongside family members if you wish to have the backing of an independent professional
• Eliminate the need to re-register assets into the names of new trustees
• Provide security for clients under the Trustee Act 2000 and Mental Health Act
• Be independent of family or business circumstances
• Replace lay trustees who no longer wish or are unable to continue acting

Lodders set up the LTC to ensure consistency of approach and to provide better availability and continuity for clients. If you have any further questions about appointing the LTC or its involvement in your matter, please do not hesitate to get in touch.