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Don't forget those offshore trusts!

It appears that everyone (including us) has been spooked by threatened rises in CGT and is running around (hopefully slightly more purposefully than headless chickens but we wonder...) identifying gains which can sensibly be crystallized before 22 June. While most of us can twig that shares or real property pregnant with gain might need attention, don't forget less obvious areas.

One such may be offshore trusts. These may well have "stockpiled gains" – gains which have been realised within the trust but not yet assessed on anyone. Those gains are potentially matched with "capital payments" made to UK-resident beneficiaries and taxed on receipt. Currently that's at 18% plus a "supplementary charge" of 10% of the tax (so 1.8%) for each year's delay between gain and payment up to a maximum grand total of 28.8%.

Thus, if capital payments are likely to be made in future years which will be matched against stockpiled gains it may be worth considering accelerating capital payments to before 22 June. Factors to consider would include the domicile of the recipient (any remittance basis planning to be done?) and whether any payment would in fact be taxed as income. For guidance and a cool head, contact Terry Jordan on 0208 922 9360.