Trust Taxation - a review of third edition of 'Trust Taxation'

Tuesday, 01 May 2012
A review of Trust Taxation by Emma Chamberlain and Chris Whitehouse.

I was delighted I was able to beat off some pretty fierce competition from one of the other STEP Journal editors to review this third edition of Trust Taxation. The authors are to be congratulated on producing this comprehensive and clear guide through the continually evolving and, some of us may say, increasingly difficult area dealing with the UK taxation of trusts. Whether you are a relative newcomer to the industry or a seasoned trust practitioner, there is something in this new edition for you – whether working with UK resident or non-resident trusts, employee benefit trusts or, indeed, foreign entities such as foundations, Delaware LLCs, etc.

The book, which includes new legislation such as the Perpetuities and Accumulations Act 2009 and Finance Acts 2009 to 2011, consists of 56 chapters broken down into five parts. Part 1 provides an overview of trust law and some recent case law on Hastings-Bass, the categorisation of certain foreign entities and trusts, residence and domicile of individuals, residence of trustees and companies, and the basic principles of taxation of non-residents and foreign domiciliaries.

Part 2 deals with income tax, and the impact of the legislation on non-settlor and settlor interested UK resident trusts, as well as the foreign dimension in relation to non-resident trusts. Capital gains tax and inheritance tax are explained in parts 3 and 4, respectively. Part 5 looks at ‘specialist topics’.

Finally, there are three appendices that contain excellent precedents cross-referring to the main text and miscellaneous material, including some interesting examples of correspondence between HMRC and STEP/CIOT.

Whether you are a newcomer or a seasoned trust practitioner, there is something in this new edition for you

I like the way the book is structured, with clear explanations and case studies as well as practical examples of tax calculations. In particular, I think the checklists and pointers in chapter 5 will be useful to practitioners. The cover of the book looks good, too. The landscape occupied by Mr and Mrs Andrews, who were the subjects of Thomas Gainsborough’s 18th-century portrait, was far less complicated than today’s. Interestingly, the portrait was not finished (there is a gap in Mrs Andrew’s lap). It is speculated that the gap was to be filled by the couple’s first child and although they went on to have a number of children, the painting was never completed – a bit like tax legislation, really! Seriously, though, Emma Chamberlain and Chris Whitehouse have produced another 21st-century masterpiece, which is a welcome addition to the bookshelf.

What you will find in the new edition:

  • An overview of the basic principles of a trust
  • Explanations of the types of trusts and advice on the most appropriate ones to use in various situations
  • Specific and common scenarios to explain how the taxes are applied
  • How past and present schemes worked and what legislation has been introduced to counteract them
  • Specialist areas such as bare trusts, reverter-to-settlor trusts, and trusts for minors and older children
  • Illustrations for inheritance tax calculations
Title: Trust Taxation, 3rd edition
Authors: Emma Chamberlain TEP and Chris Whitehouse
ISBN: 978-0-414-04335-0
Price: GBP150
Publisher: Sweet & Maxwell
Author block
Rosemary Marr

Rosemary Marr TEP is Chair of the STEP Worldwide Professional Development Committee.

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