Useful exemptions

RADICAL CHANGES TO the inheritance tax treatment of trusts were proposed in the March Budget and readers are no doubt aware of this and the resulting outcry from professional bodies (and public alike) not just for the manner in which these new rules will completely change the way most trusts will now be subject to inheritance tax but perhaps even more so for the distinct lack of consultation on the proposed changes with those interested parties. Some have viewed the latter as quite underhanded given the ongoing and lengthy consultation process between HMRC and professional bodies on the modernisation of trusts for income tax and capital gains tax purposes over the last two years.

HMRC's rationale for 'keeping their powder dry' on the proposals would appear to be to stop a pre-emptive flood of inheritance tax planning using trusts before the new rules were ushered in. It seems odd...