Tolley’s UK Taxation of Trusts (22nd edition)

01 May 2013 Chris Erwood

Tolley’s UK Taxation of Trusts (22nd edition)

By Matthew Hutton, reviewed by Chris Erwood.

The popularity and working reliance placed on this book is such that it should not come as a surprise to find it is now in its 22nd edition. Despite the passage of time, it continues to be informative, reassuring and stimulating, reflecting the aims of the original publication, but now drafted to better meet the demanding expectations of today’s trust professional. Matthew Hutton is an experienced author of long technical pedigree whose first involvement with the book started as far back as 1999 – his authorship alone is a testimony to the book’s recommendation.

It would be easy for the casual browser to be misled by the title, but be assured this is no idiot’s guide providing a gentle, step-by-step understanding of trust taxation for the novice practitioner. Despite its standard size and jolly colour, the book is definitely not light reading. On the contrary, it is one of the most detailed reference works on the subject of UK trusts taxation and, despite its logical structure, there is an underlying assumption that the reader has more than a passing understanding of trust matters. The book deals with trusts and that, by definition, does not mean estates, but it does include reference to trusts created on death and the impact on them of the Finance Act 2006 (FA 2006). Approach the book on this basis and you will not be disappointed.

The current edition runs to 514 pages, comprises 25 chapters, includes pertinent appendices (press releases, extra statutory concessions, and HMRC and professional body exchange on FA 2006 changes), provides a comprehensive list of the main statute references and both tables and cross-references key tax cases current at the date of publication. Importantly, there is a comprehensive and clear index that adopts a logical language approach, making subject navigation easier. However, it is the logical order of each chapter subject, easing the transition from one aspect to another to deliver a better understanding, that makes it work as a reference book. It is to be expected that the individual chapters should discuss and distinguish between the main trust types; address the detailed application of income tax, capital gains tax and inheritance tax to each; touch on the stamp duty land tax issues; consider the impact of anti-avoidance legislation, particularly with regard to the settlor interest; and not overlook the increasingly important compliance requirement. The book deals with all of these aspects and more.

Several chapters merit special attention by reason of their detail or relevance to current times, namely: ‘Starting/Ending a Trust: Tax and Tax Planning’ (chapters 6/17), ‘The IHT Ten Year and Exit Charge’ (chapters 10/11), and ‘Compliance: the Interest and Penalty Regime’ (chapter 20). Although the main coverage centres on the UK resident trust, the book recognises that it would not be complete without reference to the overseas arena. Accordingly, five chapters are devoted to the non-UK resident trust.

My only criticism relates to one of the more helpful aspects of the book, namely the use of illustrative and pertinent examples to demonstrate a particular point commonly met in modern practice. The whole point of illustrations is that they illustrate, so it follows that the illustration must be accurate. Accordingly, where examples from earlier editions are carried forward and updated, the arithmetic should be thoroughly checked to ensure that previous unnoticed errors are not simply perpetuated.

In summary, the book is current, extremely well written and an excellent reference work suitable for the seasoned trust practitioner.

ISBN: 978-0-7545435-1-0
PRICE: GBP119.95


Chris Erwood

CPD Reflective Learning