Lifetime Settlements

[Sharif]

Can a trust fund created by a settlement be enhanced by money coming from a third party source?

[Lee Young]

Yes. Will affect some tax treatments. What are the real concerns here?

[Sharif]

This concerns using a spouses IHT allowance by husband transfering private ltd company shares into her name and then she would make introduce these shares worth approx £300,000 into an existing settlement. The husband had originally created the settlement by transfering approx £300,000 into the settlement himself.

[Lee Young]

Presumably not a trading company?

If husband created settlement he can not benefit from it, and nor could the wife (, so there would be no IHT advantage, unlkess neither can benefit. If neither needs to benefit then wife could simply set up her own trust following the transfer of the shares.

[Sharif]

Thank you for your help.