The applicability of section 142(1) of the Inheritance Tax Act 1984 (IHTA 1984) will be a matter of looking at all the facts and circumstances of the variation. IHTA 1984, s 142(3) states that, in order to qualify for relief under IHTA 1984, s 142(1), the variation must not be made for any consideration in money or money's worth, other than

We have assumed that: • A and B were not married and so the transferable nil rate band is not available • B died less than two years ago Before answering the question, it is worth exploring how the proposed Deed of Variation will save IHT—if A and B were married then spouse exemption will apply and B’s available nil rate band will transfer to A’s estate in any event. Only if they were not married or there are transferable

In the event of death, the property of a deceased person does not pass directly to the legatees or to the persons entitled thereto under the law of intestacy. It vests, along with the liabilities and obligations of the deceased which do not cease on death, in personal representatives (PRs) whose duty it is to administer the estate by collecting

As Practice Note: Definition of a personal representative explains, a Grant of Probate can only issue to an executor named in a Will. A Grant of Letters of Administration (with Will annexed) issues to someone who is not named an executor but who has a right to administer an estate, whether or not there is a Will. Both types of Grant cannot exist at the same time, unless the authority given by the two Grants is limited and exclusive. It seems unlikely this would happen without a court order which would require good reasons for splitting

Dispute Resolution analysis: The High Court has held that a director of a holding company became a de facto director of its subsidiary, with all the liability of a director, when they became significantly involved in the subsidiary’s affairs. Richard Burrows, partner, and Dominic Sedghi, head of knowledge, Macfarlanes, examine the case.

Restructuring & Insolvency analysis: The court held a director liable to account for various sums taken out of the company in the years preceding its compulsory liquidation. Given the absence of financial records and of evidence supporting the director’s explanation for the withdrawal of the funds, the court was entitled to infer that they had not been applied for a proper purpose. As to the director’s explanation that some of the payments represented remuneration, the court held that he was not entitled to rely on the Duomatic principle for the purpose of approving remuneration, as two of the bars to the application of the principle applied. Written by Bridget Williamson, barrister at Enterprise Chambers.

Following the Finance Act 2006, disabled person trusts can be established both as discretionary trusts and as life interest trusts. These trusts can be set up by anybody, including the disabled person themselves where they qualify as a ‘disabled person’. For information on who qualifies as a disabled person, see Practice Note: Taxation of trusts for disabled persons—IHT and sections 89, 89A and 89B of the Inheritance Tax Act 1984 (IHTA 1984). Following amendments made to IHTA 1984 by section 216 and Schedule 44 to the Finance Act 2013, for all trusts established on or after 8 April 2013,

The Will trust This Q&A suggests that a discretionary Will trust was established, of which X, Y and Z are discretionary beneficiaries. The extent to which trust property is appointed and distributed to those individuals will be a matter for the trustees of the discretionary trust to decide. The question states that the beneficiary (X) who wishes to purchase the property is the sole executor of the Will. Depending on the wording in the Will, X may also be the sole trustee of

The personal representatives (PRs) of a deceased individual’s estate generally need to obtain a grant of probate or letters of administration to enable them to prove title to the deceased’s property and to administer, collect and protect it for the benefit of the persons interested in the estate. Although generally required to administer an estate in England and Wales, a grant of representation may not be necessary depending on the type and value of the assets in the estate and where they are situated. See Practice Note: Devolution of assets and the need for a grant. Executors appointed by the deceased’s Will derive their title from the Will itself and

Only members who are registered in a company’s register of members may exercise voting rights over shares which carry voting rights. The trustees, as legal owners of the shares, will, if duly registered as members, have the power to vote in accordance with the articles of association of the company. Beneficiaries

Can the trustees of a discretionary trust create a revocable life interest trust for the beneficiaries in order to assist the completion of income tax returns? The question The factual position in this Q&A is that a discretionary trust is set up with one adult and two minor beneficiaries. The trustee will currently have to deduct 45% tax on the income before paying the beneficiaries and the adult beneficiary will have to complete a tax return and claim any excess tax they have paid. The question is whether, in order to avoid the lengthy

In this scenario, the trustees are the registered proprietors of a legal charge. The powers of a proprietor of a registered charge are set out in section 23 of the Land Registration