Trust Newsletter #2 – Navigating Trust Bank Accounts: Your Essential Guide
Hi Folks,
This is Mark Pytellek from Private Trust Makers (PTM), the makers of your Trust. I am frequently approached by clients with questions concerning:
- The operation of their Trust, as well as
- A refusal or failure to open a Trust Bank account when all the Banks accept our Trust product.
To better serve our clients, I have decided to deliver a free monthly brief newsletter covering selected topics important to the smooth functioning of a Trust. The goals are to:
a. Maximize the functionality of our Trust product, and
b. Educate our clients on how to correctly and competently operate their Trust to gain the most out of it.
Opening a Bank Account
In Australia, all the Banks and most Credit Unions accept our Trust product for the purpose of opening a Trust Bank account. Recently, Bendigo Bank has refused some client applications; the reason for this is still unknown. Given that Bendigo Bank has about 70% of our total Trust accounts, their recent decision to refuse some accounts is quite odd.
In the UK, only a handful of Banks now permit Bank accounts in the name of Trusts, despite:
- All Banks there formally accepting Trust account applications, and
- The UK being the home of Trusts in recent (last thousand years) times.
In New Zealand, the Australian Banks accept our Trust product, but I have little feedback on the local Banks there.
I also have limited feedback from clients on Canadian or US Banks.
In any event, opening a Trust account is a straightforward operation, much like opening a Company account.
What Not to Do
Some folks have approached me complaining that the Bank they approached refused their application to open a Bank account. Upon listening to a client’s account of the meeting with a Bank clerk, it invariably unfolds that often a client inadvertently shoots themselves in the foot.
The three most important errors a client makes when applying to open a Trust Bank account are:
- They ask to open a “Private” Trust account. Nobody in the public realm has ever heard of a “Private” Trust, and they scrutinize the Trust Deed as if it arose from another world! Never use the word “Private.” You should simply ask to open a Trust account, and nothing more. All Banks know what a Trust is and will move forward to open a Trust Bank account. If the Bank clerk asks for an ABN number, your simple reply, as I did yesterday at CBA Bank, is, “It doesn’t have one by my choice,” and the clerk will accept that and continue the process.
- Failing to provide a Tax File Number (TFN). If the Bank clerk asks you for a TFN, rather than saying “It doesn’t have one,” give the Bank clerk your personal TFN and say no more. Don’t mention that it’s your personal TFN and the Trust doesn’t have one. Why create conditions that may give rise to obstacles and controversies that could prevent you from opening your Trust Bank account? Use wisdom and discretion in all your transactions.
- Arguing with the Bank clerk. For example, if the clerk says it will take a week to open the account, don’t demand the account be opened on the spot! Bank policies differ. Some Banks open Trust Bank accounts on the spot, others in 3 days, and some may take a week or longer. Go with the policy and don’t argue!
The Process
Simply select the Bank or Credit Union with which you wish to open your Trust Bank account. If it’s a new Bank, you will need to take your original copy of the Trust Deed as well as 100 points of ID for each Trustee to open the Trust Bank account.
Every Bank or Credit Union has a clerk that will assist you in opening the Trust Bank account. Just follow the clerk’s directions and comply, and your Trust account paperwork will be completed quickly, and your Trust Bank account opened in no time.
If a TFN is sought, provide the clerk with your personal TFN. If you’re asked about the purpose of the Trust Bank account, you can say it’s for enabling business for your Estate held in Trust.
It really isn’t any more complicated than that. I hope this guide assists you in your efforts to open your Trust Bank account easily and successfully.
Kind Regards,
Mark Pytellek
Founder
Solutions Empowerment
What a great idea and an excellent supplement to the purchase of your Trust 🙂