Trusts in commercial settings

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Although the common law trust has historically been used as a vehicle to hold property for successive generations within a family, it has also long been a feature in many kinds of commercial arrangements.

What is a trust?

A basic definition is a legal arrangement which involves a person (the ‘settlor’) transferring legal title to assets to another person or body (the ‘trustee’) to hold for the benefit of one or more persons (the ‘beneficiaries’), which may include the settlor. The terms of the trust are usually set out in a written instrument, often in the form of a deed. The trust imposes onerous duties on the trustee; failure to fulfil those duties properly may result in the trustee being held personally liable. It is important to note that the trust itself does not have any legal personality; rather, it is the trustee who is the principal actor and carries out the purposes of the trust in his own name.

For more information, see Practice Note: An introduction to trusts for commercial lawyers.

It is important to note that the trust has certain unique characteristics

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Latest Tax News

Tax weekly highlights—9 October 2025

This week's edition of Tax weekly highlights includes: (1) analysis of the High Court’s decision in Aubrey Weis v HMRC concerning the taxpayer’s claim for legitimate expectation that he would be treated as non-UK domiciled for tax purposes; (2) analysis of the First-tier Tax Tribunal’s (FTT) decision in GW Martin & Co Limited and another v HMRC concerning the treatment of payments to employees to subscribe for shares as part of a tax avoidance scheme; (3) the Scottish Government’s announcement that it intends to hold the Scottish Budget for 2026/27 on 15 January 2026 to reflect the timing of the UK Budget; (4) HMRC’s commentary on its latest corporate tax statistics; and (5) a statement from the Danish tax authority indicating that it will seek to appeal the High Court’s ruling dismissing its claims to recover £1.4bn of Danish dividend tax refunds (see also the case tracker below).

High Court permits taxpayer to bring judicial review claim against HMRC in respect of his historical domicile status (Aubrey Weis v HMRC)

Tax Analysis: In Aubrey Weis v HMRC, the High Court granted the claimant’s application to extend time to bring judicial review proceedings against HMRC and granted permission for the case to proceed to trial. The dispute concerns the taxpayer’s historical domicile status and whether he had a legitimate expectation that HMRC would regard him as non-UK domiciled, such that his foreign income and gains would be taxed on the remittance basis.

FTT holds payments to employees under tax avoidance scheme were taxable earnings despite purported repayment obligation (GW Martin & Co Limited & another v HMRC)

Tax analysis: In GW Martin & Co Ltd & another v HMRC, the First-tier Tax Tribunal (FTT) dismissed the appeals brought by the appellant companies, upholding HMRC’s PAYE income tax determinations and National Insurance contributions (NICs) decisions. The FTT held that payments the appellants made to employees under a marketed tax avoidance scheme were taxable earnings within the meaning of section 62 of the Income Tax (Earnings and Pensions) Act 2003 and section 3 of the Social Security Contributions and Benefits Act 1992.

Tax weekly highlights—2 October 2025

This week's edition of Tax weekly highlights includes: (1) News Analysis on the FTT’s decision in Isle of Wight NHS Trust concerning the VAT treatment of supplies of locum medical practitioners, (2) HMRC guidance on how agents can report other agents where poor R&D tax relief service standards are suspected, and (3) a new HMRC service for paying high income child benefit charges via PAYE.

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