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New queries, issue 4341

14 February 2012
Issue: 4341 / Categories: Forum & Feedback
Accidental trust; Food for thought; Two trusts; VAT visits

Accidental trust

I have a client a married couple in their early 50s who recently bought a house from a housing association at a discount to its true value. The occupant of the house was the wife’s elderly aunt aged 77.

Subsequent to buying this house the couple then prepared a legal agreement giving the elderly aunt the right to occupy the house at no rent for the remainder of her natural life.

The couple also agreed to pay all the normal running costs on the house in particular heating lighting repairs maintenance insurance etc.

HMRC’s press release of 15 August 1979 states that if trustees permit a beneficiary to occupy a dwelling house at less than full commercial rent this will create an interest in possession.

Does this now mean that my clients have created...

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