What investments are authorised under the Trustee Act 2000?- FS

Question 1

What major change did the Trustee Act 2000 introduce regarding trustee investment powers?

Answer 1

The Act granted trustees the general power to invest as though they were absolutely entitled to the trust assets, significantly expanding their investment options.

Question 2

Which section of the Trustee Act 2000 contains the general power of investment?

Answer 2

Section 3 sets out the general power of investment, allowing trustees to make any kind of investment they could make personally.

Question 3

How did trustee investment powers differ before the Trustee Act 2000?

Answer 3

Trustees were previously limited to a narrow range of low-risk investments, making it difficult to grow the value of the trust.

Question 4

What types of investments does Section 3 of the Trustee Act 2000 authorize?

Answer 4

Section 3 authorizes all types of investments, provided they are ones a person could make if they owned the assets outright

Question 5

What does Section 8 of the Trustee Act 2000 permit with respect to land

Answer 5

Section 8 permits trustees to acquire freehold or leasehold land in the UK either for investment, beneficiary occupation, or other purposes.

Question 6

Are trustees permitted under the Act to purchase property located outside of the UK?

Answer 6

No. Section 8 only allows trustees to purchase UK property; acquisitions outside the UK are not permitted under this provision.

Question 7

Can trustees use trust funds to buy a UK home for a beneficiary to live in?

Answer 7

Yes. Under Section 8, trustees may purchase UK property to be occupied by a beneficiary, as long as it’s consistent with the trust’s objectives.

Question 8

What are the two main purposes for which trustees can acquire UK land under Section 8?

Answer 8

Trustees may acquire UK land either as an investment (e.g., rental income or capital growth) or for occupation by a beneficiary.