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Needs refurbishment
My client has a funded unapproved retirement benefit scheme (FURB) which he has had for many years (prior to us acting). Initially the FURB was attractive as it was only assessable to the basic rate of tax.
Since 6 April 2006 the FURB has been subject to taxation at the trust rate. This has never bothered our client as he has been a 40% taxpayer.
From 6 April 2010 the rate for trusts will be 50% and our client is now only working part time and may only just be a 40% taxpayer. Whereas for most trusts the tax can be recovered by making an income distribution I cannot see how this can be achieved with a FURB.
The only asset in the FURB is a residential property and our client is considering closing the FURB and transferring the property to himself.
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