A minor beneficiary in Singapore is one who is under the age of 21. A minor beneficiary in Singapore is unable to claim any inheritance left to him/ her by a deceased person until he/ she reaches the age of 21.
Minor Beneficiary in Singapore Under a Will (With a Testamentary Trust)
A testamentary trust is created for the holding of the assets on trust for the minor beneficiary. The trustee has the powers to carry out the instructions of the deceased on the management of the assets held on trust. The trustee may hold the legal title of the asset for the time period before the child beneficiary turns 21. However, the child beneficiary still owns the assets.
The deceased may leave instructions to the trustee to apply the funds held on trust for the minor beneficiary’s education and daily expenses. The trustee will manage the funds according to the deceased’s wishes until the minor beneficiary turns 21.
An application will need to be made for the grant of probate (i.e. a Court order allowing the executor to administer the estate of the deceased). Usually, both the executor and the trustee are the same person. After obtaining the grant of probate, the monies from the deceased’s account can be transferred to the trustee to manage on behalf of the minor beneficiary. Sometimes, the executor may have to liquidate the deceased’s assets to generate funds for the beneficiaries. The share belonging to the minor beneficiary will then be transferred to the trustee for his/ her safekeeping.
Duty of Trustee of Minor Beneficiary in Singapore
The trustee should understand the terms of the trust as provided in the Will. He/ she should safeguard the trust assets and maintain up-to-date accounting records of the usage of the funds. The trustee should also disclose the fact that they are trustees when carrying out transactions as prescribed in the Will.
Minor Beneficiary in Singapore in the Absence of a Testamentary Trust
In this case, the assets belonging to the minor beneficiary should be distributed to the child according to the Will. If a guardian is provided for in the Will, the executor disburses the minor beneficiary’s share to the testamentary guardian who will then manage the funds for the child.
In the absence of a testamentary trust, the executor will not know the deceased’s wishes on how the funds belonging to the minor beneficiary should be used. Thus, it is advisable that you create a testamentary trust for your minor beneficiary if you are executing a Will.
A testamentary guardian is a person appointed by the deceased who steps into the deceased’s shoes to shoulder the responsibility of being a care-giver to his/ her minor children.
The testamentary guardian will have custody over the minor beneficiary and will be responsible for paying for the child’s education and expenses.
After the child reaches the age of 21, the executor, trustee or guardian will distribute the child’s share to him/ her. If the executor, trustee or guardian fail to uphold their duties, they may be subject to legal proceedings.
Minor Beneficiary in Singapore in the Absence of a Will
A grant of letters of administration need to be applied. This is similar to the grant of probate. A co-administrator and surety will need to be appointed as well. A surety is a guarantor who will be held financially responsible if the administrators cause financial loss to the minor beneficiary due to their failure to discharge their responsibilities.
If you have a child under the age of 21, you should consult an experienced Wills lawyer for guidance on how to prepare your Will in a manner that your child will be well-protected even after your demise.
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