Number and value of trusts in UK continue to decline despite ‘surprising’ rise in registrations during last tax year—Spear’s
Following the publication of the HMRC’s annual statistics on UK trusts for the FY 2023-24, partner Suzanne Mynors has been quoted in a Spear’s article that gathers experts’ reactions to the new figures.
The latest statistics reveal a notable increase in trust and estate registrations during 2023-24 but a decline in overall tax contributions.
Commenting on the legacy left by tax changes made in 2006, Suzanne observes that "lawyers are often advising clients on winding up now-inappropriate trusts rather than setting up new ones." She adds that trusts remain a practical vehicle for HNW individuals where significant sums of wealth are involved, saying "most current trusts are for significant sums, making them worth the effort." She goes on to dispel misconceptions surrounding trusts:
It is an urban myth that you can give your home to your children or a trust and continue to live there. If you do so without paying full market rent, the gift will fail for inheritance tax purposes.
Advertisements for ‘family asset protection trusts’ or similar from non-lawyers should be treated with extreme caution. They can lead to unintended consequences and unnecessary tax charges.
The full article is available to read at Spear's. Suzanne's comments have also been quoted in eprivateclient, available to read by subscription only.
Suzanne Mynors is a partner in the private client team. She specialises in wills and succession planning, probate and estate administration, trusts and trust taxation, inheritance tax planning, powers of attorney and mental capacity work.
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