The following Private Client guidance note provides comprehensive and up to date legal information covering:
FORTHCOMING CHANGE: As originally announced at Autumn Budget 2017 and followed up by written statement after Spring Statement 2018, plus an announcement in Budget 2018, the government ran a consultation on the taxation of trusts from 7 November 2018 to 28 February 2019, inviting views on the principles of transparency, fairness and simplicity that it believes should underpin the taxation of trusts. See also the research exploring the use of trusts which was also published on 7 November 2018. See News Analysis: Exploring the consultation and review on the taxation of trusts.
It is possible for trustees or personal representatives to be trading. For example, if a self-employed trader dies, the personal representative might run the business until it can be wound down or sold.
Similarly trustees or interest in possession beneficiaries may be trading and eligible for such reliefs as roll-over relief or entrepreneurs' relief.
The same general tax principles of trading apply to all traders, whether they are individuals, trustees or personal representatives. This Practice Note outlines these principles below.
The most fundamental point to consider is whether there is a trade.
Whilst in some cases it will be obvious, such as where the personal representatives take over the deceased's business, in some cases even a single transaction can be considered to be a trade.
For instance, trustees
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