Taxation logo taxation mission text

Since 1927 the leading authority on tax law, practice and administration

Readers' forum : New trust

10 July 2018
Issue: 4655 / Categories: Forum & Feedback

Tax consequences of transferring assets from one discretionary trust to another.

A discretionary trust was established in 2003 with a perpetuity period of 80 years and an accumulation period of 21. Its principal asset is a 38% holding of shares in a family investment company. There is a small cash balance.

The shares have accumulated a significant capital gain.

The class of beneficiaries includes the grandchildren and remoter descendants of the settlor and their spouses. The default trust is for the settlor’s great-granddaughter absolutely who is severely disabled. The trustees are the daughter now aged 74 and granddaughter-in-law.

The settlor’s letter of wishes dated in 2003 directs that:

  • the great-granddaughter should be considered the principal beneficiary during her lifetime;
  • subject to this the income and capital of the trust should be used for the benefit of the settlor’s grandson and his wife (who is one of the trustees) and their other...

If you or your firm subscribes to, please click the login box below:

If you are not a subscriber but are a registered user or have a free trial, please enter your details in the following boxes:

Alternatively, you can register free of charge to read a limited amount of subscriber content per month.
Once you have registered, you will receive an email directing you back to read this item in full.

Please reach out to customer services at +44 (0) 330 161 1234 or '' for further assistance.

back to top icon