Since the original announcement made by the HMRC UK, on changes to the UK tax laws in 2015, a number of consultations, delays and further announcements were made throughout 2016 leading to indicate that the implementation of the changes will happen on 6 April 2017.
This caused a rush of planning for possible re-structuring by many consultants in 2016. Subsequent political factors further delayed the implementations and an announcement was made in September 2017 that the changes will take effect retrospective from 6 April 2017.
Whilst a number of factors are still being clarified, the takeaway points from the talk by Mr. Nick Jacob - Partner, Private Client, Fosters were:
- Non domicile residence will be considered as Deemed domiciled from the 15th year of residence in the UK, thus be liable to world-wide tax basis
- To review possibilities of creating new trusts or adding assets into existing trusts before being deemed as domicile, so that UK Inheritance Tax (IHT) matters can be addressed
- NOT to add in any further assets into the trust after being deemed domiciled
- To keep good records of all acquisition costs and values and to make election in year of disposal
- Trust is still a good planning tool
- To be careful of tainting the trust e.g. loans must be with commercial interest rate
- There are new rules on valuation of benefits
- For UK residential property owned under a company or partnership no longer protected from UK IHT
- Anti-avoidance provision will catch any arrangements to avoid IHT
43 attended the talk, most were from the banking and trust industry.
Click HERE to view event photos.
Contributed by:
Ms Linda Wong
Managing Director, Kensington Trust Singapore Limited