On 26 June 2017, the UK Government introduced a beneficial ownership register for trusts for the first time, in response to its need to comply with the EU’s 4th Anti-Money Laundering Directive. Which trusts will be affected and what will trustees have to do?
Thursday, 13 July 2017
Thursday, 29 June 2017
The thorny issue of a couple’s beneficial interests in a jointly owned property following relationship breakdown has once again been examined by the court, this time relating to a Privy Council decision on appeal from the Bahamian Court of Appeal. The case concerned the relationship between Mr Marr and Mr Collie, who together had jointly purchased several properties over the years in the Bahamas during their 17 year relationship.
Thursday, 15 June 2017
The UK may become the first country to introduce a beneficial ownership register for overseas companies and other legal entities owning UK property (of any kind) or who wish to procure UK Government work.
Thursday, 1 June 2017
This week, I have a guest post from my colleague Grace Laws in our Property team, with her advice on the legal dos and don'ts of Airbnb letting:
Airbnb has become known as the world’s largest accommodation provider but it owns no property. It gives property owners an opportunity to let their properties out on a short-term basis with relative ease and gives consumers an opportunity to stay in a home and ‘live like a local’ in their location of choice. As a result of this it has become well known in recent years and is used frequently by many.
For property owners it has become an easy and profitable way of generating additional income, particularly for those with residential properties in desirable city centre locations. However, if you choose to use Airbnb or any other short-term letting website for letting your property, it is important that you consider the legal consequences of doing so alongside the financial benefits.
Thursday, 18 May 2017
How should a personal representative (PR) deal with a request from a beneficiary for an interim distribution before the estate is finalised? Estates can take many months to conclude but a beneficiary may be in need of some of their inheritance sooner. Can an executor help out without putting him or herself on the line?
Thursday, 4 May 2017
The Finance Bill 2017 contained a number of measures altering the way in which long term UK resident non-doms and UK residential property held in certain offshore entities would be taxed in the UK. However, last week it became clear that all of the non-dom tax changes would be dropped from the Finance Bill, to allow a slimmed down version of the Bill to progress through the legislative process before Parliament is dissolved ahead of the General Election on 8 June.
So what is the current state of the law? Are the relevant pre-6 April 2017 tax laws still in force? Are non-doms who have been resident here in the UK for 15 out of the previous 20 tax years now deemed domiciled, or can they still make use of the remittance basis of taxation? Does foreign corporate ownership of UK residential property still provide a UK Inheritance Tax (IHT) shelter or not?
Thursday, 20 April 2017
April is ATED filing month – 2017/2018 ATED tax returns must be filed and any ATED tax paid by 30 April at the latest. Even if no ATED is due, because a relief from ATED applies, that relief still needs to be claimed on an ATED tax return, which must be submitted by the end April deadline just the same.
Thursday, 6 April 2017
Trustees of UK trusts holding a UK managed investment portfolio will soon need to apply for a Legal Entity Identifier (LEI) number from the London Stock Exchange.
The EU legislation known as the Markets in Financial Instruments Directive (MiFID) affects firms who provide services to legal entity end users which involve financial instruments, such as shares, bonds and collective investments. Its latest incarnation, MiFID II, comes into effect on 3 January 2018. It places upon them new transaction reporting obligations, meaning that they cannot execute a trade in a financial instrument on behalf of any client for whom they do not have an LEI.
Thursday, 23 March 2017
Last week, the Supreme Court brought to an end a 13 year legal battle over the late Mrs Jackson’s Will. The Will left virtually all of Mrs Jackson’s assets (some £480,000) to three UK charities, cutting out entirely her only child (Mrs Ilott), who was for many years estranged from her mother but who lived in very financially straitened circumstances with her husband and five children.
Thursday, 9 March 2017
Currently most applications made by solicitors for a UK grant of representation for a deceased’s estate incur a flat fee of £155 payable to the Probate Registry. However, perhaps within a little over two months’ time, a grant could cost as much as £20,000! How did we get here and, more importantly, what can be done about it?
Thursday, 23 February 2017
A simple way for non-dom married couples to manage the Inheritance Tax on UK residential property from 6 April 2017
Offshore companies holding UK residential property will no longer be opaque for UK Inheritance Tax (IHT) purposes from 6 April 2017. The change is being achieved, courtesy of the Finance Bill 2017 as currently drafted, by removing IHT ‘excluded property’ status from an interest in a closely held company (see the 15 December 2016 blog for a brief definition) which derives its value, directly or indirectly, from UK residential property.
Thursday, 9 February 2017
To date, UK resident non-doms may not have been greatly impacted by the UK tax system’s plethora of measures to try to get the foreign income and gains received by offshore trusts (i.e. trusts that are not UK tax resident) taxed in the UK. This is because one of the key anti-avoidance provisions, the ‘S.86 Settlor Charge’ which can make a trust’s settlor liable for the offshore trust’s gains, only applies to settlors who are both resident and domiciled in the UK.
Thursday, 26 January 2017
The UK Government has released draft legislation giving effect to its proposal to deem the domicile status of certain UK resident non-doms to be UK domiciled, regardless of their actual domicile.
The changes only apply to non-doms who, on or after 6 April 2017, have been tax resident in the UK for 15 out of the previous 20 tax years. For example, in tax year 2017/2018 beginning on 6 April 2017, the changes would only affect any individual who has been resident in the UK continuously since UK tax year 2002/2003 or earlier. These non-doms will be deemed to be UK domiciled.
Becoming deemed UK domiciled has a number of implications for UK taxes.
Thursday, 12 January 2017
Do you have a survivorship clause in your Will? Chances are you do, if you leave assets to someone outright in your Will. The mischief that these clauses are designed to avoid is this. If A gives a gift to B in his Will and B dies the day after A, B’s estate will get the gift and it will be B’s Will that decides where A’s gift ends up. However, in these circumstances, A may have wanted someone else to get the gift instead (A may not like B’s choice of heirs!). Survivorship clauses are meant to solve this problem. They also prevent the delay associated with the same money being administered through two separate estates and can reduce the total Inheritance Tax bill on both estates.
Survivorship clauses introduce a condition of survivorship to an otherwise outright gift in a Will – for example: ‘I give £100,000 to my nephew if he survives my death by 28 days’. Sometimes a catch-all survivorship clause is included instead; for example: ‘My estate is to be divided as if any person who dies within 28 days of my death had predeceased me’. However, this exact catch-all phrase unfortunately caught out the estates of the late Mr and Mrs Winson, as recently decided in the case of Jump v Lister  EWHC 2160 (Ch).