IHT and trusts

It has already been noted in “Topic of the month” that Government is having further if not second thoughts about the proposals to charge tax on ten year anniversaries and when property leaves the settlement at a rate calculated with the aid of a reduced nil rate band. The Consultation paper, which originally seemed to put forward the suggestion that the nil rate band to be used in these calculations should be divided by the number of all the settlements that the settlor had ever made, contained two other proposals for change. It suggested that statute should fix a time after which, for IHT purposes, trustees should be deemed to have accumulated income, and also suggested changes in the timescale for submission of IHT accounts and payment of tax. Government has now published draft legislation in relation to these points.