The trustee annual review: what is checked and what you confirm

A trustee annual review is the structured check a professional trustee carries out on a trust once a year. The aim is simple: to confirm that what the trustee holds on file about the settlor, the beneficiaries, the protector and the assets is still true, and that every report the trust depends on rests on current information. It is routine work, but it is also where small changes in a family's life are first noticed.

For most clients the visible part is the annual questionnaire. Behind it sits a wider body of work, described below, so that you know what is being asked of you and why.

Why a trustee reviews a trust every year

A Swiss professional trustee is a regulated financial institution. The law defines a trustee as someone who, as a profession, manages a separate pool of assets, or disposes of it, for a beneficiary or a stated purpose under a trust deed within the meaning of the 1985 Hague Convention (Art. 17 para. 2 FinIA, known in French as LEFin). The trustee must manage those assets, keep their value and use them for their intended purpose (Art. 19 para. 2 FinIA).

Day-to-day supervision is not handled by the FINMA directly. FINMA grants the authorisation, and a supervisory organisation, itself authorised and overseen by FINMA, checks on a continuing basis that the conditions are still met. Trustees must also be audited each year by an audit firm (Art. 62 FinIA). A yearly review of your own trust is the practical counterpart: it keeps the file in a state that an auditor or supervisor could read without surprises.

The review is therefore not a favour and not an inspection of you. It is part of how a regulated trustee proves that it knows who stands behind each structure. For the wider picture of supervision, see FINMA and SO-FIT: what trustee approval means for you.

What the trustee reviews

The scope varies with the structure, but the review usually covers the following areas.

Identity and risk files

Documents proving identity, address and source of wealth are refreshed on a cycle that depends on the risk profile of the trust. A passport that has expired, a new tax residence or a change of occupation all feed into the file. This work sits within the anti-money-laundering framework (AMLA, or LBA in French).

Parties and beneficial owners

The trustee confirms who the settlor, beneficiaries and any protector currently are, and who counts as beneficial owner for the purposes of banks and authorities. Births, deaths, marriages and divorces matter here. If you want to see how roles fit together, read the trustee, protector and beneficiary triangle.

Residence and classification

Where a party moves country, the trustee reassesses how the structure is classified and reported under automatic exchange of information (AEOI, also called CRS), and whether other reporting regimes become relevant. The result depends on each person's residence and on the nature of the assets, so it needs an individual analysis.

Bank accounts and requests

The trustee looks at the accounts held for the trust, the signatories and any questions raised by banks or authorities during the year. See your trustee and the trust bank accounts for the day-to-day side.

Registers and records

Where registers must be kept, the trustee checks that entries, decisions and minutes are complete and consistent with the trust deed.

The annual questionnaire

The questionnaire is the point where the trustee turns its own knowledge into questions for you. It is short in principle, because most answers are "no change", yet it deserves a careful reading. Typical items include:

• your current residence and any intended move;
• your tax status and any new tax identification numbers;
• changes in the family: births, deaths, marriages, separations;
• changes in the assets contributed or intended to be contributed;
• changes in your own role, your business or your public functions;
• whether any third party has been given influence over the trust.

Answer from the facts, not from memory of last year's form. A confirmation that is simply copied forward is the most common reason a file ends up out of date.

• Read last year's file before opening the questionnaire
• List address, residence and tax identification changes
• Note family events affecting the beneficiaries
• Mention any change of signatory or adviser
• Return the questionnaire with supporting documents where requested

An example: an address change found at review

Example: a settlor, a fictional entrepreneur based in Lausanne, signs the questionnaire and confirms that nothing has changed. While refreshing the file, the trustee notices that a recent bank statement carries a different address, in another country. After a short exchange, the settlor explains that the family has started to spend most of the year abroad.

That single detail changes several things. The tax residence may have shifted, the classification of the structure for information exchange has to be reassessed, and the bank may need updated documents. Because the trustee found it at the yearly review rather than a year later, the correction is made in an orderly way. For this scenario in more depth, see when the settlor moves country.

What you should tell your trustee between reviews

The yearly review is a safety net, not a substitute for telling the trustee about changes as they happen. A regulated trustee must itself report changes in facts to its supervisory organisation in advance, so late information on your side can slow down the trustee's own obligations. Tell it promptly about a move, a change of beneficiary circumstances, an approach by a tax authority or a new bank relationship.

What the service covers, and what it does not

The ongoing compliance service keeps files, reports and beneficial owner data current year after year. In practice it includes:

• annual classification and filings under information-exchange regimes;
• periodic refresh of identity and risk files;
• monitoring of changes in parties or residence;
• handling of requests from banks and authorities;
• maintenance of registers where required.

It does not cover tax advice for your country of residence, the drafting of a new trust deed, or decisions on distributions. Those belong to other work and to your own advisers. Nor can a review remove every risk: it reduces the chance that an error stays hidden. Fees depend on the structure and are indicated after the confidential assessment.

If you are comparing trustees, ask how the review is run and who signs it off; due diligence on your trustee lists the questions. For a broader yearly picture, the annual trust health check and compliance and reporting duties complete this page.

What a confidential assessment establishes

A confidential assessment lets you set out the structure, the parties and their countries of residence, and lets the trustee describe the review it would run, the documents it would need and the points it would watch. It is general information until then: what applies to you depends on your residence, your beneficiaries and the nature of the assets.