Frequently Asked Questions about Children's Trusts Services


Who has the legal authority to manage a child’s estate?

A child’s estate is money or property that is due to a child from something like an inheritance or an insurance payment. Parents and guardians of a child can make personal decisions for a child in areas such as education, medical care, and social activities. However, they may not have the authority to make decisions about the child’s estate. The Guardianship Act, section 17, sets out the rules about who may receive money and property for a child and how to deal with it. For money, the amount matters.

A guardian who acts as a parent to a child is a guardian of the person. Someone who has the legal authority to manage the money and property that is due to a child is a guardian of the estate.

How to deal with an amount of $10,000 or less

A child may receive up to $10,000 without making special arrangements as long as they get no more than $2,000 of the money in any one year. For example, a parent or relative could receive the money and pay the child $2,000 per year for up to five years ($2,000.00 x 5 = $10,000).

Any of the following people may receive up to $10,000 on behalf of a child

  • the child, if the child must support another person, such as a seventeen-year old girl who has a baby she is supporting
  • the parent the child lives with
  • the person who has legal custody of the child
  • the adult who is appointed as guardian of the person for the child under the Guardianship Act

Any of these people may write a receipt to show that they have received this money. The receipt will be considered legal in a court.

A parent or guardian who receives money for a child must carry out the responsibilities of a guardian of the estate for the child in these ways

  • manage the money properly and for the benefit of the child
  • keep detailed accounts that show how the money was invested, managed, and spent

How to deal with an amount over $10,000, or if the person holding less than $10,000 does not want to pay out the money over several years

A parent or guardian may apply to be a guardian of the estate for a child for one of two reasons

  • there is more than $10,000 that is due to the child
  • the person required to pay the money to the child does not want to hold the money for the child and pay it out over several years

The court will appoint a guardian of the estate for the child only if the court believes that this is in the child’s best interest. This person must show both the child and the court that they will administer the child’s property properly. The court is likely to require the guardian to give the court a bond or other form of security. A bond acts like insurance. The bond guarantees that if the guardian improperly administers the estate and the money is lost or stolen, the company will step in and pay the amount due to the child if the guardian of the estate does not.

How to pay a child who works for you

If you hire a child, you may pay the child’s wages directly to them.

What is the role of the Public Trustee in managing the financial estate of a child?

In Nova Scotia the Public Trustee is, by law, the guardian of the estate of every child unless someone else has been appointed to that role by the court.

The money must be paid to the Public Trustee when money or property is due to a child and any of these things is true:

  • no one is named as a trustee to receive the money
  • no one has been appointed by the court to act as the guardian of the estate for the child
  • the person required to pay the money to the child does not want to hold the money for the child and pay it out over several years

Examples of when money that is due to a child must be paid to the Public Trustee

a child inherits money or property

A child inherits money, land, a house, or some other kind of property. There is no will, or the will does not appoint a trustee for the child’s estate.

a child receives a benefit

  • A child is the beneficiary of an insurance policy, or a lump-sum payment from a pension plan or a registered retirement pension plan. The beneficiary card does not name a trustee to hold the funds for the child.
  • A child wins money from a lottery or other game of chance.
  • A child is awarded money under the Hepatitis C Settlement Agreement.

a child receives money from a lawsuit

  • The Public Trustee is often asked to receive money and hold it in trust when it is awarded to a child from a lawsuit.

If the Public Trustee agrees, these things happen:

  • The court names the Public Trustee as the trustee of the money.
  • The money is paid to the Public Trustee to hold in trust for the child.
  • The judge approves the arrangements and directions in an order.
  • The Public Trustee follows the order and manages the money for the child.

Can the Public Trustee or someone else spend money on behalf of the child from the fund the Public Trustee is holding in trust for the child?

The Public Trustee can spend money only according to the terms of a will or directions of a trust agreement or court order. In many situations, there is no will, trust agreement, or court order. In those situations, the Public Trustee can spend money from the trust fund to look after and educate the child.

In making decisions about whether to spend money from a trust, the Public Trustee will consider the following:

  • the situation that requires funds to be spent
  • the obligation of a child’s parents to support and look after the child
  • the child’s situation
  • the size of the estate
  • whether the money will be spent to maintain the child or for their education
  • the source of the property. For example, a child may inherit a family home but it would not be in the best interest of the child, at this time, to sell the home in order to make some money available

Can I sell or mortgage property that belongs to my child?

You must apply to the Supreme Court if you want to sell or mortgage a child’s property, whether you are a parent, guardian of the person, or trustee. The court must find the sale necessary for one of these reasons:

  • to support the child or to pay for their education
  • to benefit the child in some important way
  • to deal with a problem in the child’s title to the property, as long as this does not hurt the child

The court will want to know that the child will get the proper value for any property that you sell or mortgage on their behalf.

Does the Public Trustee provide information to the parent or guardian during the time it is holding trust funds?

At the end of every year, the Public Trustee prepares a statement of all the financial transactions that were made for the account during that 12-month period, and mails it to the parent who has custody of the child or the child’s guardian of the person.

Does the Public Trustee charge fees for its service as trustee?

The Public Trustee is entitled to charge trustee fees. Trustee fees are the following:

  • 2/5ths of 1% of the full amount of the trust fund and
  • 5% of any income earned by the trust fund

These fees are then paid to the Minister of Finance of Nova Scotia. The Department of Finance pays the salaries of all of the staff in the Public Trustee’s Office. The salaries and budget of the Public Trustee’s Office are set by the province.

The Public Trustee is also entitled to be repaid for the cost of any services it pays for on behalf of a child. For example, the Public Trustee would charge the trust fund the amount it cost to have someone prepare the tax return for the trust.

When is a child entitled to receive the money from the trust account?

The Public Trustee will hold the funds until the child turns 19 unless the will or other trust document gives an age that is older than 19.

Shortly before the trust is handed over to a child, the Public Trustee will do three things:

  • contact the child
  • have a detailed statement of the account prepared for the child
  • have a release form prepared for the child to sign

If a child dies before they receive the funds, then the Public Trustee will release the property to the person who is appointed by the Probate Court to be legally responsible for the child’s estate.

What if I have questions about my child’s ability to manage money after their 19th birthday?

The law says that 19 is the age when a child becomes an adult.

The Public Trustee understands that some parents may be concerned about their child receiving a large sum of money on their 19th birthday. However, the law says that your child is entitled to receive any funds that are due to them. The Public Trustee is not allowed to hold back these funds unless there are signs that the child may not have the mental capacity to manage their financial affairs when they reach 19. The Public Trustee cannot hold back your child’s funds simply because the child is not responsible or mature.

You may consider hiring a lawyer or other advisor to talk to a child about options that an adult has for managing the money or property from a trust.

What help can you give to a child who has an intellectual disability and will never be able to manage their affairs?

The Public Trustee will work with you and your child to help plan for the child’s future.

If you believe that your child may never have the mental ability to manage their financial affairs, then you can go to the Supreme Court, as soon as the child turns 19, and ask the court to appoint a legal guardian for the child’s financial estate and property. This is governed by the Incompetent Persons Act.