London Trustee Investment advice

It often used to be the case that to avoid tax one simply tucked assets away in trust. Sadly for trustees the government has woken up to this in recent years and there has been a succession of changes resulting in the relatively high rates of tax shown below. But there are ways round this through careful planning – read on….

For 2014/15 the tax rates on the first £1,000 of  accumulation/ discretionary trust income is

Type of income Tax rate – 2014 to 2015 tax year
Dividend-type income (such as income from stocks and shares) 10% (the ‘dividend ordinary rate’)
All other income (rent, business income, savings) 20% (the ‘basic rate’)

Tax rates on accumulation/ discretionary trust income (over £1,000)

Type of income Tax rate – 2014 to 2015 tax year
Dividend-type income (such as income from stocks and shares) 37.5% (the ‘dividend trust rate’)
All other income (rent, business income, savings) 45% (the ‘trust rate’)

This means that trustees should focus their investments on so–called “non income producing assets”. Conveniently such assets do produce “income” and often provide capital growth… Contact Us

Stay away from with profits funds Maturing With Profits

Trustees have a legal duty to provide capital protection for remainder men and a decent income for the life tenant. The well known case of Nestle vs. NatWest underlined the point.

http://webjcli.ncl.ac.uk/articles3/morris3.html

Trustees must have a written investment strategy and review the performance of their investments on a regular basis. Under the Trustee Investment Act 2000 they are also required to take professional, independent, investment advice.

Facts & Figures are expert in advising trustees, settlers and beneficiaries.

We recently had a case where a lawyer had left trust money on deposit for years. When we were instructed the trust was receiving an income of a paltry 0.5% per annum. We moved things around and the trust saw spectacularly improved returns.

Past performance is no guarantees of future returns but if the trustees do not do their best to invest trust monies effectively they could face the wrath of the beneficiaries.

see also

Wealth Management

Investment Adviser Kent

Inheritance Tax Planning Kent

Inheritance Tax IHT Advice Kent

IHT Advice Kent

Investment Advice Kent

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