Some major developments came out of Westminster this month with many impacting private client advisors. Welcome to the wrap-up of the top ten most popular stories in STEP’s online UK Digests throughout March 2015 as clicked by our readers.
All about the budget: The 2015 UK Budget was, by far, the most significant story for readers of STEP’s UK news digest. In fact, the 19 March edition was almost entirely Budget related coverage. As a result the link above is to the full Budget document, however STEP focussed specifically on these stories:
– Early end to Liechtenstein and Crown Dependency amnesties
– Review of deeds of variation
– Castle Howard case prompts restriction of ‘wasting assets’ CGT relief
– Farmers’ averaging extended from two to five years
– Lifetime allowance for pension contributions reduced again
– Enterprise CGT rules tightened
New form simplifies creation and registration process: The form used to create lasting powers of attorney (LPA) in England and Wales has been amended to amalgamate the instruments for making and registering an LPA. The requirement for two certificate providers has also been removed. The old forms introduced in 2009 can still be executed until 1 January 2016.
Farmer’s daughter granted one-third of farm value: Cardiff’s High Court has awarded GBP1.3 million to Eirian Davies to settle her proprietary estoppel claim on her parents’ Carmarthenshire farm. Her claim on the GBP3.8 million farm was accepted last May by the England and Wales Court of Appeal (Davies v Davies, 2014 EWCA Civ 568), but the parties’ inability to reach agreement have forced her to go to court again to obtain compensation.
Trusts with no US Reportable Accounts need not file ‘nil returns’ with HMRC: UK financial institutions (FIs) (including many trusts) with no US Reportable Accounts will now not need to file ‘nil returns’ to HM Revenue and Customs under the US Foreign Account Tax Compliance Act. This has been welcomed by STEP, but we note that practitioners should still ensure that, where necessary, trusts have been registered with the US Internal Revenue Service and that the required due diligence is completed to establish if there are US Specified Persons connected to a trust.
Executor-beneficiary jailed for false IHT return: A woman who declared the value of her aunt’s estate as GBP285,000 instead of the real amount of GBP1.5 million has been jailed for almost three years. Theresa Bunn came to HM Revenue and Customs’ notice when it discovered she was financially supporting a friend and using her friend’s bank accounts to conceal her assets.
Pre-marital wealth of GBP5 million distributed on needs basis: The ex-wife in S v S (2014 EWHC 4732 Fam) has obtained a financial remedy of GBP5.6 million on the basis of her needs, although virtually the whole of the couple’s combined assets of GBP25 million were brought into the marriage by the husband. Mr Justice Bodey ruled that she needed a GBP2 million house in the country, a GBP65,000 new car, and a London flat worth GBP800,000, as well as funds to provide her income.
TDF examines pilot trusts proposal: A thread on the Trusts Discussion Forum (TDF) discusses the recent changes to inheritance tax on multiple pilot trusts created on the same day. The proposal is in the new draft section 62A to the Inheritance Tax Act 1984, published last December.
CoA dismisses film relief scheme promoter case against HMRC chief: Patrick McKenna, Chief Executive of film tax relief scheme promoter Ingenious Media, applied to the Court of Appeal to challenge the actions of HM Revenue and Customs’ former boss Dave Hartnett, who referred to him in a highly unfavourable context in an off the record press briefing in 2012. The court dismissed McKenna’s appeal.
Comparison of parties’ tax policies: Smith & Williamson has published a comparison of the main political parties’ tax policies for private clients and for companies, as set out in their election manifestos.
Land leased to solar farms will attract IHT charge: Farmers who lease out their land to solar farm operators may be incurring a future inheritance tax charge that outweighs the cumulative income from the lease, according to a farm accountant. Such land no longer qualifies for full agricultural property relief even if sheep are grazed under the solar panels, says Mike Butler of Old Mill.
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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