A Brief Guide to Inheritance Tax and Trusts

The Capital Taxes Office check the account. If the value of the Estate exceeds the tax threshold, Inheritance Tax will be payable. Some of this tax is due on the application for Probate.

How is that to be funded when the Executor or Administrator cannot access the Deceased's money?
At Burnside & Logue we can offer advice on this and on tax-efficient procedures both at the time of the Will is prepared and, after death, to the Executors of a Will or to the Administrators where there is no Will. Lifetime Gifts, Gifts of income, Tax planning schemes, Deeds of Variation and such like are also possibilities.

Advice on personal tax
We also give advice generally on all aspects of personal tax. This advice may save you or your beneficiaries tax, "may" because please remember, the rules are constantly changing. As new schemes are thought up the Inland Revenue tries to get the Law changed. The Inland Revenue can and will look at transactions to gauge the proper intent and tax accordingly.

TRUSTS
Trusts have been around since the 13th century. For more than 600 years! Did you know that when the Crusader knights went off to the Holy Land, because they were worried about what might happen to their castles and other lands, they made provision for them to be "owned" by friends until they returned.

Those friends then gave them back their castles and lands. It was a way of protecting what you owned when you were not there to protect it yourself. You went to the Crusade knowing that your wife and daughters were safe!

In this century, putting your assets into a Trust has also been a way of keeping them safe. Safe from the profligate child. Sometimes, safe from the Inland Revenue.

There are many different sorts of Trust:

There can be Trusts where you are a Beneficiary; your wife; your children; your grandchildren; or a combination of all of these. There are even Trusts where no-one specifically is the Beneficiary. In those cases the "Trustees" have the right to choose who is to benefit from the Trust. The Trust can be of Capital or it can be of Income. It can be created by you during your lifetime or by your Will. There are detailed and complicated rules which stop Trusts going on for ever.

While there are many different sorts of Trusts, some points are constant. There are Trustees who are in charge of the Trust.

The trustees
Own the property that is the subject of the Trust.
Decide where the Trust property is to be invested.
Deal with the Inland Revenue.
Pay any tax that may be due on the Trust.

In the special cases where there are no specific Beneficiaries they decide who is to be the Beneficiary.

They pay to the Beneficiaries the Income of the Trust. In some cases, they will give to the Beneficiaries some of the Capital of the Trust.

We at Burnside & Logue can take over the administration of a Trust, advising the Trustees appropriately and dealing with the day-to-day running of the Trust.

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