trust & tax planning

Even before the Finance Act 2006 the use of trusts for managing family or other assets over several generations and for tax planning arrangements was a specialised and complex exercise. Now, more than ever before, great care needs to be exercised in ensuring that an arrangement will fulfil a client's requirements without creating an unexpected and immediate tax charge out of thin air.

Special attention needs to be devoted to the interaction of Inheritance (IHT) and Capital Gains (CGT) Taxes. Despite its title, IHT is not a charge which only arises following a death. To further complicate matters the introduction of the Pre-Owned Assets Tax and the removal of the use of certain CGT reliefs by the Finance Act 2003 has made any lifetime planning a legal and financial minefield.

Nevertheless trusts do still play a very important part in making sensible and valuable provision for families, old and young clients alike, and continues to provide a useful tool in legitimately saving tax in many circumstances. We at Thompson Leatherdale believe that having this expertise is crucial for a family and business driven practice. For that reason we have concentrated on developing and updating our private client practice.

Contact John Thompson