Spotlight
Family Law Awards 2020
Shortlist announced - time to place your vote!
Court of Protection Practice 2020
'Court of Protection Practice goes from strength to strength, having...
Jackson's Matrimonial Finance Tenth Edition
Jackson's Matrimonial Finance is an authoritative specialist text...
Spotlight
Latest articles
Hundreds of thousands of companies worldwide fall victims to hackers every year. Is your firm one of them?
SPONSORED CONTENT Image source: Information is beautifulYou and other lawyers and legal assistants in your firm likely have accounts on the hacked websites listed in the image above. If a hacker...
New complaints handling guide offers advice to local authorities
The Local Government and Social Care Ombudsman is today issuing new guidance on effective complaint handling for local authorities.Based on previous documents, the new guide offers practical,...
EU laws continue until at least 2038 and beyond
The UK left the EU on 31 January 2020.  But in matters of law it fully leaves on 31 December 2020.  But EU laws will continue to apply, and be applied, in the English family courts from 1...
Family Law Awards winners announced in virtual awards ceremony
The winners of the Family Law Awards 2020 were announced at 4pm during a much-anticipated virtual awards ceremony. Over the past ten years, the Family Law Awards has recognised the leading players in...
Behaviour-based divorces still merit close consideration
Some recent cases illustrate the evidential and procedural issues involved in dealing with proofs on the merits of divorce, which are worth considering even though most cases may conclude on a...
View all articles
Authors

Tax implications in respect of Children Act 1989, Schedule I trusts

Sep 29, 2018, 17:37 PM
Slug : tax-implications-in-respect-of-children-act-1989-schedule-i-trusts
Meta Title :
Meta Keywords :
Canonical URL :
Trending Article : No
Prioritise In Trending Articles : No
Date : Jul 16, 2007, 04:23 AM
Article ID : 88861

Jonathan Tod, Barrister, 29 Bedford Row and Jan Ellis, Tax Partner, Baker Tilly. New tax provisions hidden away in Sch 20 to the Finance Act 2006 abolish accumulation and maintenance trusts and mean that inheritance tax (IHT) is now payable in respect of any trust set up during the settlor's lifetime. The new regime also extends to trusts set up to provide a home for a child or children during their minority in Children Act 1989, Sch 1 proceedings. The Re P approach is no longer tax free.

The provisions are retroactive and will affect trusts set up before Budget Day 2006, which were structured as accumulation and maintenance settlements, and all new settlements executed after 22 March 2006. There are various different tax charges that can apply to trusts within the new regime. In this article the authors examine the tax charges, and the exemptions from them, in detail, identifying the requirements that must be complied with in order to avoid them. The new regime is illustrated with a worked example and ways of providing a home for children under Sch 1 without creating trusts are considered, and the tax implications of these explored. Concluding with some useful advice points for practitioners the authors warn that the potential liability to IHT charges for trusts imposed under Sch 1 proceedings must be managed unless and until Parliament is persuaded to amend the legislation.

For the full article see August [2007] Fam Law.

Categories :
  • Articles
Tags :
Authors
Provider :
Product Bucket :
Recommend These Products
Related Articles
Load more comments
Comment by from