Taxation of trusts consultation - Law Society response
HM Revenue and Customs (HMRC) has invited views on the principles that it believes should underpin the taxation of trusts:
The consultation document provides examples of areas where it believes these may not be fully met and seeks views and evidence on the case for and against reform to these and other areas.
We urge that the government should take a consistent approach to the reform of trust taxation that addresses unnecessary complexity and potential unfairness.
We made several suggestions for areas where targeted reform might be valuable, including:
- simplification of the inheritance tax "relevant property regime"
- extending the bereaved minors trust regime
- changes to the vulnerable beneficiaries trusts regime to make it more fit for purpose
What this means for solicitors
This consultation is part of a wide-ranging review of the taxation of trusts.
It will affect solicitors advising on trust structures in private client practices and in a range of other practice areas.
The consultation closed on 28 February.
The government is not making specific proposals for reform at this stage.
It has stated that it will consider the views and evidence presented in the consultation and weigh up the options for targeted reforms accordingly.
Read the consultation on the GOV.UK website