I have been, since its establishment 25 years ago, a trustee of a settlor-interested trust. The only capital asset was a large shareholding in a company founded by the settlor and expected to flourish, though not to the amazing extent it has now achieved (this year's income will be over £500,000). The beneficiaries are the settlor (now very old), his family and charities.
I have been since its establishment 25 years ago a trustee of a settlor-interested trust. The only capital asset was a large shareholding in a company founded by the settlor and expected to flourish though not to the amazing extent it has now achieved (this year's income will be over £500 000). The beneficiaries are the settlor (now very old) his family and charities.
Up until 2005-06 things were very straightforward. The income went on his return and the tax he paid in consequence was reimbursed by the trust. The income remaining in the trustees' hands could be distributed to anyone with no tax consequences. Now things have changed drastically. The trust pays the higher-rate tax with nobody to reimburse but distributions are another matter. In 2006-07 the settlor's wife received £60 000 and £50 000 was given to charities. What should...
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