Been too busy enjoying the summer to keep up to date with all the laest UK industry news? Welcome to the wrap-up of the top ten most popular stories in the STEP online Digests throughout August most clicked by our readers.
Amended guidance on UK-US IGA: STEP, The Law Society and ICAEW have amended the UK-US FATCA IGA Guidance and corresponding flowchart to incorporate some new wording from HMRC. This is not a change of substance, simply a clarification that only affects the wording in questions 3, 4 and 5 (on p12 of this guidance). The core message remains the same – practitioners need to take action now to ensure their obligations under FATCA are met.
Newspaper sets ‘pay before you die’ hare running: The Daily Telegraph has started a scare that people who set up trusts to avoid inheritance tax might in future be forced to pay it before they die. It may be referring to HM Revenue & Customs’ new accelerated payment powers, which could be used to enforce the existing periodic IHT charges on trusts under the relevant property regime.
LPA does not legally exist until registered: The England and Wales Court of Protection has ruled that a lasting power of attorney (LPA) is legally created only when it is registered by the Public Guardian, not when it is executed by the donor. The decision – made in the complex case of N & S v E & M (2014 EWCOP 27) – was important because it established that an LPA executed by a donor took precedence over a ‘living will’ (an advance decision to refuse medical treatment) that she had signed on the same day.
Attorney spent too much on improving her mother’s living accommodation: A woman who took her elderly mother into her own home and gave up her career to look after her has had her power of attorney revoked by the England and Wales Court of Protection. The court considered she had spent too much of her mother’s money on adapting the property to accommodate her mother’s needs (Public Guardian v AW, 2014 EWCOP 28).
Never specify a legacy twice: What does the executor do if a will specifies the value of a legacy both in words and in numerals, but the two values are different? It appears that the practice of duplication is common despite being deprecated by experts for exactly this reason.
Impact of the accelerated payment rules: Experts at law firm Baker & McKenzie summarise HM Revenue & Customs’ new powers under the accelerated payment regime that came into effect on 17 July 2014, covering income tax, capital gains tax, corporation tax, inheritance tax and stamp duty land tax.
Official receiver winds up dubious estate-planning firm: The government’s Insolvency Service has wound up a Nottinghamshire company that marketed schemes claimed to protect clients’ assets through wills, trusts and lasting powers of attorney. Goldstar Law of Newark received GBP400,000 in clients’ advance payments but provided very little in return.
Call to report QCs who give deliberately misleading tax advice: A claim that some barristers make a practice of giving misleading opinions about the validity of tax-planning schemes has provoked a reaction from the Bar Standards Board. Its chief executive says QCs should report colleagues whom they believe to be breaching its code of practice.
Government yields on electronic LPAs: The Ministry of Justice has postponed plans to introduce a fully electronic online process for the creation and registration of lasting powers of attorney in England and Wales. Instead it will simplify the paper-based process, which will soon allow donors to specify when the power is to take effect.
Forcing trusts into DOTAS ‘will hurt ordinary families’: New proposals to bring mainstream trust-based inheritance tax planning into the Disclosure of Tax Avoidance Schemes regime will disadvantage ordinary families with modest assets, not just the wealthy, according to Standard Life’s family finance expert Julie Hutchison TEP. She says the proposals will impose a compliance and reporting burden even where no tax is due, for example where trusts are used to hold life and pension policies.
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.
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