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Non-dom complications

19 September 2007
Issue: 4126 / Categories: Forum & Feedback
Various tax treatments of offshore trust set up by UK resident, non-domiciled settlor.

My UK resident non-domiciled client — and his immediate family — are beneficiaries of an offshore non-settlor interested excluded property discretionary trust set up less than five years ago.

All the beneficiaries are UK resident and non domiciled and thus potentially subject to TA 1988 s 740 on any non-income benefits or capital payments received.

The only substantial asset of the trust is an offshore company OC1 which has a 50% shareholding in a UK investment company UKCo which was a trading company and has only recently become an investment company following the sale of its businesses. The remaining 50% of UKCo is held by an offshore company OC2 also owned by an offshore trust with which we are not concerned.

My client is a director of UKCo which has an investment property cash and interest-bearing loans to...

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