Implications of the trusts consultation document

KEY POINTS

• Many trusts suffer from a minefield of complexity introduced by previous governments without enough thought as to the consequences.
• Reduce the trustees’ reporting and taxpaying responsibilities but ensure the settlor pays any tax due.
• Capital gains tax on pre-2006 interest in possession trusts should be simplified.
• Inheritance tax calculations can be complicated and time consuming with low amounts of tax payable.

The HMRC consultation on the taxation of trusts was issued on 7 November fulfilling the promise made by Chancellor of the Exchequer Philip Hammond in the 2017 autumn Budget (see here).

The closing date for responses is 30 January but we confess that our printouts of the condoc have sat dog-eared on our desks while we considered answers to the nine questions. As we approach the end of December ...