Time for Trustees to Make Big Savings on Inheritance Tax

03 September 2008

There’s still time for trustees to secure significant savings on inheritance tax before new legislation comes into force on October 5, says Kent trust management specialist Harvey Barrett.

The legislation relates to the Finance Act 2006 which resulted in the most radical change to inheritance taxation of trusts in 30 years. It was only thanks to intense lobbying from professional organisations that the Government was persuaded to make changes.

Initially, the changeover period was due to expire on April 5 this year but in the last budget trustees were given a temporary stay of execution and the deadline was deferred until October.

Harvey, partner of one of the south east’s leading law firms Furley Page, commented: “Trustees have a duty to preserve their trust fund for the benefit of the beneficiaries and be prepared to take whatever steps necessary to ensure that the least amount of tax is payable out of that fund.

“Now is the time – with the approaching deadline - to discuss the possibility with their professional advisers and their beneficiaries of restructuring their trust and creating what are known as transitional serial interests or TSIs – new life interests that have the advantage of being taxed under the old regime.”

For further information contact Harvey Barrett on 01227 763939.

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