STEP News Digest wrap-up – May’s top stories

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Too busy to read the news in full? Welcome to the wrap-up of the top ten most popular stories in the STEP online Digests throughout May. In case you missed them, here are the top STEP News Digest stories most clicked by our readers.

IRS clarifies trust registration procedure: The US tax authorities have definitively set out the procedure by which trustees worldwide can certify a trust as exempt from the US Foreign Account Tax Compliance Act. The procedure is required whether or not the trust has any American connections.

Regulator aims to improve solicitors’ wills: The Solicitors Regulation Authority has published new guidance on the drafting of wills. It reflects the results of a 2011 research project that found high street solicitors were just as likely to produce poor quality wills as were unqualified will-writers.

Deputies deposed for ‘looting’ are refused a share of P’s estate: Two women who had their deputyships of 94-year-old Gladys Meek revoked for spending much of her GBP500,000 estate on themselves and their families have asked the Court of Protection to execute a statutory will leaving them some of her remaining assets. However the court refused, and moreover not only called in the former deputies’ GBP275,000 security bond in full but also named them publicly.

Drafting a pre-nup carries high risk for practitioners: Practitioners working in the relatively new field of marital property agreements could be exposed to massive professional negligence claims if they recommend pre-nups or post-nups that later go wrong, say two experts. One leading silk in the field simply refuses to advise on them.

Mountain goes on sale to pay IHT bill: Lord Lonsdale’s decision to sell Saddleback Fell in the Lake District, to help pay inheritance tax liabilities on his late father’s estate, has attracted much attention. Lord Lonsdale died in 2006, leaving the title and estate to his eldest son Hugh Lowther, but with an IHT liability of GBP9 million. His death also triggered lengthy litigation between the new earl and the trustees of the Lonsdale family trusts, concerning deeds allegedly signed by the seventh earl on his deathbed.

Government drops plan to extend 1975 Act jurisdiction: The government has agreed to remove a controversial measure of the Inheritance and Trustees’ Powers Bill that would have allowed reasonable provision claims to be brought against the estates of persons domiciled outside England and Wales.

Fixed-fee billing is now the norm in will-writing: Less than 10 per cent of all legal work for ordinary consumers is now billed by the hour, according to new research from the Legal Services Consumer Panel.

Inheritance and Trustees’ Powers Bill enacted: The Inheritance and Trustees’ Powers Bill has received royal assent and will come into force on 1 October 2014. It simplifies the intestacy rules for England and Wales, in particular abolishing the spousal life interest trust. It also amends the Inheritance (Provision for Family and Dependants) Act 1975 and the powers for trustees to apply income and capital under the Trustee Act 1925.

Applying for a grant when named executor is incapacitated: If the first-in-line executor nominated in a will is losing mental capacity, can the second-in-line apply for probate just by reciting the first’s incapacity in the oath, or is supporting evidence and the involvement of the Court of Protection required? Practitioners discuss.

Second Icebreaker LLP scheme loses at tribunal: Last week’s tribunal victory for HM Revenue & Customs in the Icebreaker tax planning case has attracted much media attention because some participants were former members of a popular boy band.

The STEP Industry News Digests provide a round-up of relevant industry news for trust and estate practitioners and other professionals in the wealth management sector. They provide brief summaries of topical news stories gathered from news providers internationally, providing a quick reference for busy practitioners to all the relevant news and issues. The News Digests also feature job listings from our recruitment site and list local STEP branch events and conferences. STEP’s digest services include twice weekly UK and Wealth Structuring (international) editions as well as a bi-weekly North America Digest focusing on the US, Canada and Mexico, and a Latin America Digest.

To subscribe to STEP’s digest services you will need to first register here:http://www.step.org/register

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