For Lawyers, IFAs and Business Intermediaries Trust Company Fee Transparency is Essential

As an intermediary, when it comes to the costs associated with the running of a trust, are you clear as to exactly what your service provider connections are charging your clients?

Because if not, then this really ought to be standard information with which you should be familiar. Apart from anything else, it could help you avoid any awkward conversations with your clients down the line, who may have found themselves stung by charges they had no idea were heading in their direction.

Fee transparency should always be the name of the game – and you and those you advise should expect nothing less.

To ensure your clients are fully appraised upfront as to what trust company fees they will face, at Sterling Trust we’ve created a clearly itemised Trust Establishment and Management Schedule of Fees for maintaining a trust structure. This is designed to ensure that everyone who needs to know has a clear handle on what annual costs to expect for our services – avoiding any nasty surprises!

How Our Tiered Fee System Works

In the section of the Schedule entitled Annual Responsibility Fees, we have devised six tiers of payment. These are commensurate with the level of service we provide, based on the value of assets appertaining to each client. The higher the tier of assets under management reflects the level of work we are required to undertake in order to satisfy regulation and compliance. What each tier has in common, however, is that it has a fixed annual fee. We don’t indiscriminately charge according to a client’s level of wealth.

For instance, a Tier 1 client will have one or more of the following assets with a combined value of up to £500,000 – a Portfolio Bond, a single premium life contract, an accident plan, or shares in a company managed by Sterling Trust Limited. A Tier 4 client will have assets with a combined value of between £1.5m and £2.5m to include all the assets covered in Tiers 1-3.

Our fixed annual fee level for each tier is as follows:

Tier Zero – £450
Tier 1 – £720 per annum for a single premium
Tier 2 – £1,800
Tier 3 – £3,600
Tier 4 – £5,000
Tier 5 – Price on application

The only time there may be a need for additional charges is if something extraordinary and unforeseen happens during the course of the year. In which case, we will always advise clients, in advance, that there will be supplementary costs to take into account.

As an intermediary and introducer looking to provide your clients with a consistent and transparent level of service, we know from experience the importance of fee transparency in terms of building and maintaining client trust. To this end, we believe clear, all encompassing fixed fees leave no one in any doubt as to what costs will be incurred.