Trust administration services: what your trustee does day to day

Trust administration services are the unglamorous core of trusteeship. Once the trust deed is signed and the assets are in place, the trustee's work becomes a steady rhythm of record-keeping, decisions, correspondence with banks and communication with beneficiaries. Done well, it is largely invisible. Done badly, it is the first place a problem shows up. This page walks through what that routine looks like over a year, so you can judge whether your own trust is being run to that standard.

A year in the life of a trust

Every trust has its own deed, but most settle into the same cycle. The calendar below is an illustration of fixed tasks, not a promise of dates; your deed and your assets set the real timetable.

Some tasks recur because the law or the bank demands them. Others recur because good practice does. The value of a professional trustee lies largely in the fact that none of them is left to memory.

What the service covers

The table sets out the main strands of day-to-day trusteeship and what each one produces.

For the Swiss-specific side of reporting and supervision, see compliance and reporting duties.

Books and yearly statements

The Hague Convention on trusts describes a trustee as someone who holds assets under their control, in their own name, as a separate fund, and who must manage them and account for them. The accounting part of that sentence is the daily reality of administration. Under Article 2 of the Convention, trust assets form a separate pool and are not part of the trustee's own estate. In practice that means separate ledgers, separate accounts and statements that tie each entry to a decision.

Expect the year-end statements to show what came in, what went out, what the assets are now worth and what was decided along the way. If the figures cannot be traced to a minute or an instruction, that is a warning sign worth raising early.

Minutes and decisions

A trustee who exercises discretion should be able to show how. Minutes are the record: who considered what, which documents were looked at, which options were weighed and why one was chosen. They matter most when a decision is later questioned, by a beneficiary, a protector or a tax authority.

Good minutes are short, dated and specific. They refer to the deed rather than paraphrasing it, and they note any input from the protector. Missing minutes are one of the commonest findings when an outside party examines an older trust.

The custodian bank and appointed managers

Most trusts depend on at least one bank. The trustee is the contact for that bank: opening and maintaining accounts, supplying updated ownership and control information, answering the bank's own compliance questions and confirming instructions in writing. Our page on the trustee and the trust bank accounts goes into more detail.

Where an external asset manager is appointed, the trustee does not simply hand over responsibility. The trustee sets the mandate, receives regular reports, compares results with the stated objectives and keeps the right to challenge or replace the manager. Oversight is a duty in its own right, separate from the investment work itself.

Distributions under the deed

Requests for money arrive in different forms: a regular payment to a beneficiary, a one-off request for a purchase or a family event, a loan. Each is tested against the deed. Is the person a beneficiary? Does the trustee have the power? Is the request consistent with the settlor's wishes, expressed in a letter of wishes? Would the payment affect other beneficiaries?

For example, a family in Lausanne might ask the trustee to fund a daughter's first home. The trustee would look at the deed, at the daughter's position relative to her siblings, at the liquidity of the trust and at any protector consent required, and would minute the outcome before releasing anything. How a payment is treated for tax depends on where the beneficiary lives and on the nature of the assets, so it calls for individual analysis.

Letters and reports to beneficiaries

Beneficiaries are entitled to different levels of information depending on the deed and the governing law. A competent trustee decides at the outset what each class will receive and sticks to it. A typical routine includes a covering letter with the yearly statement, a note on any change of trustees, protectors or banks, and a prompt reply to reasonable questions. What the trustee owes beneficiaries is explored in what a trustee owes the beneficiaries, and the limits on disclosure in information your trustee must give you.

The annual review

Once a year the trustee steps back from the individual tasks and asks whether the structure still fits. Has anyone moved country? Have the beneficiaries' circumstances changed? Are the powers still being used as intended? Is the bank relationship in good order? This review draws on the same logic as the yearly compliance review, and you can test your own trust with the annual trust health check.

Who this service is for

Trust administration is relevant to several situations:

• a settlor who wants the routine handled by a regulated professional in Geneva;
• a family that has inherited a trust and found that nobody is keeping the books;
• an adviser or family office that needs one point of contact for banks and beneficiaries;
• a trust whose current trustee has become slow, silent or hard to reach.

If you are still comparing candidates, start with due diligence on your trustee.

What it does not cover

Day-to-day administration is not legal, tax or investment advice for you personally. It does not replace your own tax adviser in your country of residence, and it does not decide whether a trust is the right vehicle in the first place. It also does not extend to services that sit outside the deed, such as running an operating business. Where such work is needed, it is scoped separately.

What the confidential assessment establishes

The confidential assessment is the point at which these general descriptions become specific. It allows the trustee to establish what the deed requires, what assets and banks are involved, who the beneficiaries are and where they live, what records already exist, and where there are gaps. Fees depend on the structure and are indicated after that assessment, not before it.