"Recycling" an offshore Trust

[taxiscomplex]

A friend of mine has received what I think is questionable advice. He settled an offshore discretionary trust whilst UK domiciled for IHT purposes but not for CGT purposes. This trust has a pre 6 April 2008 gain that could be distributed to beneficiaries and avoid the 10 year IHT charge. There would be no IHT exit charge.

The idea is that Trustees add a new beneficiary (a friend who is non UK domiciled for IHT purposes). The beneficiary receives the funds. The friend then settles a new offshore trust for largely the same beneficiaries. There's the ovious risk that the friend runs off with the money, but the settlor is content to take this risk.

Is this "legitimate planning" or "unacceptable avoidance". Sounds like avoidance to me although I can't see which sections stop it as no tax is being avoided and the beneficiaries of the new Trust will not be exactly the same and in particular not include the settlor of either Trusts.

[maths]

Is the object here to turn non-excluded property into excluded property or access the trust property without precipitating any UK CGT charge re the pre April 2008 capital gain ?

[taxiscomplex]

Is the object here to turn non-excluded property into excluded property or access the trust property without precipitating any UK CGT charge re the pre April 2008 capital gain ?

If I understand correctly there is no CGT re the pre April 2008 gain due to the transition arrangements? The gain could be paid to the Non domiciled UK residents free of any CGT.

The key objective is that of the 10 year Charge of 6% every 10 years and to rid the Trust of a "deemed domiciled" settlor by giving the funds to a non deemed domiciled beneficiary who settles a new trust for largely same beneficiaries.