Timely Modernisation

The Trustee Act 2000 which came into force on 1 February 2001 represents the most extensive revision of English trust law in 75 years. Given the widespread use of trusts in tax planning its provisions will be of considerable importance to tax practitioners.

It should be noted at the outset that the Act does not reform what might be termed fiduciary powers (the power to advance capital under section 31 Trustee Act 1925 for example). The purpose of the 2000 Act is rather to bring trustees' administrative powers up to date primarily to enable trustees to take advantage of more modern means of making and holding investments such as CREST and dematerialised holdings. For a full discussion of the deficiencies of the old law and the reasoning behind the reforms effected by the Act the reader is referred to the Law Commission...