Trusts


Our Group Life Assurance policies are designed to work in conjunction with a discretionary trust. Any benefits, in the form of a lump sum or dependant’s pension, will be payable to the scheme trustees. Employers can establish their own trust. Alternatively, our Group Life Master Trust, which is available through CLASS, could be an ideal solution for small employers who do not have any Group Life Assurance cover in place.

Employer-Established Trusts

The scheme must first be established by executing a trust deed to set up a discretionary trust. Group life benefits can be provided under a pension scheme or a stand-alone group life scheme. The trust deed appoints the scheme administrator and ensures that HM Revenue & Customs (HMRC) requirements are met for registered schemes. The next steps are:

  • The scheme administrator registers themselves with HMRC if they are not already registered
  • The scheme administrator then registers the scheme with HMRC
  • If the scheme administrator is not already registered, this may take a few days to complete
  • Registration is not required for schemes set up using our master trust

A guide to using HMRC’s online service is available from their website.

We will need the Pensions Schemes Tax Reference number and the date of registration to complete a proposal form and assume risk for registered schemes.

In some circumstances, an excepted scheme may be more appropriate than a registered scheme. To help determine which to use, we have produced a comparison of the two which can be found here.

We should be contacted to agree any changes to the insurance cover required if the benefits for members change as a result of any amendment to the trust deed and rules. Changes in cover will not automatically be applied to the policy.

The following specimen deeds of declaration of trust (and accompanying scheme rules) are available to establish a standalone group life scheme that can provide lump sum and / or dependant’s death in service pension benefits for employees in accordance with the Finance Act 2004 and can be registered with HMRC.

There are different versions depending on the type of organisation and whether there are corporate or individual trustees.

Attached to each deed are notes about their use and completion. Independent legal advice is recommended in all circumstances. You can view further guidance notes here.

The following specimen deeds of amendment change the provisions of declarations of trust (and accompanying scheme rules). These are available for registered standalone group life schemes to update the trust deed and rules to the most up-to-date versions to meet the requirements of the Finance Act 2004.

There are different versions depending on the type of organisation and whether there are corporate or individual trustees.

Attached to each deed are notes about their use and completion. Independent legal advice is recommended in all circumstances. You can view further guidance notes here.

This deed will be needed if:

  • The business of the outgoing principal employer has been purchased by the new principal employer.
  • The outgoing principal employer has been dissolved but its employees have been re-employed by the new principal employer who wishes to maintain the existing scheme.
  • There is an internal restructure of the corporate group the principal employer belongs to and it is decided that another company within the corporate group should be the principal employer.

Please note that this list is not exhaustive. There may be other instances where this deed might be appropriate.

Attached to each deed are notes about their use and completion. Independent legal advice is recommended in all circumstances. You can view further guidance notes here.

If you need to change your policyholder, we will also require a Change of Policyholder form - Click Here

This deed is used by the trustees of a group life assurance scheme to change the name of the Principal Employer and the name of the Scheme.

Attached to each deed are notes about their use and completion. Independent legal advice is recommended in all circumstances. You can view further guidance notes here.

This deed is used by the trustees of a group life assurance scheme to change the name of the scheme.

Please Note: There is a different form of deed if you wish to change the name of the principal employer and the name of the scheme.

Attached to each deed are notes about their use and completion. Independent legal advice is recommended in all circumstances. You can view further guidance notes here.

Specimen deeds of declaration of trust are available for use with standalone excepted group life policies and relevant life policies for an individual. These deeds can provide lump sum benefits for schemes that are not registered with HMRC.

These deeds are not currently available on our website. The versions available are:

  • Excepted trust for employees where the Principal Employer is sole trustee
  • Excepted trust for employees where the Principal Employer is a partnership
  • Excepted trust for Partners of a partnership

We do not have any deeds suitable for completion for arrangements in the Channel Islands or the Isle of Man. To obtain a copy of a deed of declaration of trust for an excepted policy, please contact our customer service centre on 0345 223 8000 or e-mail groupcsc@canadalife.co.uk

We strongly recommend that the deed is referred to legal advisers for vetting and tailoring. If there is any uncertainty about which document to use or whether a document is suitable for your organisation, we recommend seeking independent legal advice.

Master Trust

The Canada Life Group Life Master Trust scheme is already in place, so there is no need for the employer to set up a trust and register their own. The administration of the trust, including reporting to HMRC, is taken care of by independent scheme trustees. The scheme trustees take full responsibility for deciding who receives benefits if a claim becomes payable. All employees included in the scheme should be encouraged to complete an Expression of Wish form to assist the trustees in making their decision. We will request any further information required about the employee’s circumstances on receipt of a claim. We have no control over this decision-making process and are not liable for any act or omission of the independent trustee.

Employers must ensure that the Canada Life Group Life Master Trust is appropriate and meets their needs. We strongly recommend employers seek appropriate advice before taking action in respect of the Canada Life Group Life Master Trust.

  • The Canada Life Group Life Master Trust is only available in association with Registered Group Life Assurance policies issued by Canada Life.
  • It provides lump sum benefits for PAYE-taxed employees. It is not suitable for the provision of death in service pension benefits or benefits for non-PAYE taxed individuals.
  • Employers receive all of the tax advantages applicable to a registered pension scheme.
  • Inclusion in the Canada Life Group Life Master Trust is available to employers subject to completing a Deed of Participation.
  • There is no additional cost to use this service.
  • If the principal employer cancels the policy, then they and all associated employers will immediately exit the master trust on the date the policy ceases.

The Canada Life Group Life Master Trust is an HMRC-registered pension scheme administered by Trustee Solutions Limited, who will ensure that the trust is maintained and complete the necessary reports for HMRC. A copy of the master trust deed can be viewed here.

Trusts

This website is for UK professional advisers only and is not approved for use by private customers.

Canada Life Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.

Canada Life International Limited and CLI Institutional Limited are Isle of Man registered companies authorised and regulated by the Isle of Man Financial Services Authority.

Canada Life International Assurance (Ireland) DAC is authorised and regulated by the Central Bank of Ireland.