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Where Taxpayers and Advisers Meet

Mandating income-Discretionary trust

Joined:Fri Jun 01, 2012 10:11 am
Re: Mandating income-Discretionary trust

Postby strawn » Wed Dec 15, 2021 11:36 pm

- Mandating income from a discretionary trust is quite possibly a breach of trust (because the trustee(s) are not really making a decision wrt the income); and
- It would not work - the argument that a mandate could create an informal I-in-P is the sort of argument HMRC might run if it suited them (or that we imagine they might) but not one a taxpayer should be relying on.
Are you really suggesting that a huge investment manager like abdn is wrong on this?

Joined:Wed Aug 06, 2008 3:25 pm

Re: Mandating income-Discretionary trust

Postby maths » Thu Dec 16, 2021 2:37 am

I will leave AG to respond re his post but as I read it he was merely raising possible issues which might need to be considered further.

The size of an organisation is not directly correlated to the quality of its tax advice.

As far as I am aware (but stand to be corrected) the organisation is not a tax adviser but primarily offers investment advice.

Why didn't abdn address the issue of possible breaches of trust? It's clearly an issue which needs consideration and at the very least if they believe there is no issue then they should have made the point in their article. Maybe it never crossed their mind.

Joined:Fri May 16, 2014 3:47 pm

Re: Mandating income-Discretionary trust

Postby AGoodman » Thu Dec 16, 2021 12:35 pm

"Are you really suggesting that a huge investment manager like abdn is wrong on this?"

Having now gone to the trouble of reading their article, no, I am not. In fact I'm fairly sure I'm agreeing with them that it would be sensible to appoint an IIP to beneficiaries receiving a lot of income. Nowhere do they advocate mandating income to discretionary beneficiaries.

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