CGT proposals likely to spark renewed interest in trusts

News Team, 16/11/2020

The Office for Tax Simplification's proposed widespread changes to Capital Gains Tax (CGT) that could see the tax doubled as well as some reliefs abolished is likely to drive the gifting of assets, UK accountants Hillier Hopkins have suggested. 

But with clients concerned about asset protection and wanting to delay outright gifts the firm said it expected to see a renewed interest in settlor life interest trusts as individuals look to cap CGT liabilities.

Debbie Wilson, a director at Hillier Hopkins who acts for private individuals and their families, commented: “A settlor life interest trust is a very specific trust that allows an individual to crystalise a chargeable capital gains tax disposal whilst continuing to benefit from the income generated by those assets.

With changes to CGT mooted for some time now, Ms Wilson said she had already seen an increased interest in this type of trust, particularly from individual...

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