A very useful gifting exemption is the exemption which applies to gifts which can be characterised as “normal expenditure out of income”. To comply with this exemption certain principles must be strictly adhered to. I set out these basic principles for your future reference in the paragraphs below. Basically, Section 21(1) Inheritance Tax Act 1984 allows an individual to make Inheritance Tax exempt gifts provided the gifts can be characterised
The concept of a trust is derived from a 12th century requirement in England to have a protective measure ensuring that wealth in the form of land passed down in a controlled manner from one generation to another. The trust mechanism had a secondary function of reducing the incidence of taxation. Despite the centuries during which trusts have existed, there is no comprehensive definition of “trust”.
The rules on validly signing a Will or Codicil are very strict and must be followed precisely or else the execution may subsequently be ruled invalid. The following guidelines should therefore be strictly followed. Alternatively, one should execute the Will or Codicil at the office of the lawyer who drafted it to ensure a valid execution.
Morgan Trusts & Tax Planning Limited is a company registered in England and Wales Number 10327429 and is authorised and regulated by the Solicitors Regulation Authority.
The Rules which apply to Solicitors can be found in the Solicitors Regulation Authority Handbook at www.sra.org.uk/handbook.