Is Your Trust Structure Right For You?


With the changes in the trust tax regime which come in on 6 April, now might be a good time to give thought to any trust structures you have in place. In particular the position regarding undistributed income in the trust should be given some thought – if there is too much retained income a tax charge may arise under S496 of the Income Tax Act 2007. On the other hand if the ‘tax pool’ is sufficiently large, delaying a distribution until after the start of the 2010/2011 tax year may be beneficial (this will also depend on the personal tax situation of the beneficiary).
Another planning point is to consider creating a revocable interest in possession for beneficiaries and putting it in place before the end of this tax year.
Trust tax planning is a complex process, with both Income Tax and Inheritance Tax aspects. We can advise you on all trust and tax matters.

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