I would say yes. My great uncle set up his business with a family trust and added my sister, brother and I onto it and didnt say anything to my mum and dad. A few years later, they received a massive tax bill relating to it. My great uncle took care of it but its not the point, I think if you are adding anyone then you should mention it to their parents.
If the niece or nephew are under age then yes I think it would be best to ask / tell the parents that this is something that you are looking to do so to make sure they are okay with it. However in saying that most trust deeds that I've looked at already have multiple extended family members mentioned as beneficaries - aunts, uncles, sons, daughters, nieces, nephews so don't think it is anything unusual. if its a discretionary or family trust the trustee of the trust determines who any trust profits/income gets distributed to. I can't see how a tax situation would arise unless they receive a distribution from the trust at which stage the parents would be aware that income had been earned and that there might be tax implications.
I have just found out that DS is named on one but have been told that he will not recieve anything as it is only for a paper trail, I am not happy this was all done without previous consultation, I want to know if their will be any problems for his or our tax or benefits for the future?
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