Standard Investment Criteria?

The Trustee Act 2000 outlines a statutory duty relating to Investments, unless the trust has outlined specific provisions with the Trust deed. Trustees are required under the Act to ensure that any existing or proposed investment is suitable.

Considerations needs to be given to the trust aims, investment diversification, costs, risk profile of the trust fund in addition to several other aspects. Other considerations would include the investment requirements of the trustees and beneficiaries, whether an ethical or sociably responsible investment strategy should be used, the tax position of the trust and the underlying tax position of the investment held within the trust.

As a consequence any existing or proposed investments held in trust should meet the standard investment criteria. Trustees are required under the Trustee Act 2000 to regularly review the suitability of trust based investments. The trustees can decide the frequency of reviews, but we would recommend that a review is carried out at least annually. For larger trusts the trustees might consider reviewing the trust assets on a more frequent basis.