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Settlor; settlors

This category contains 17 posts

War of the roses

War of the Roses is a 1989 American film based on the 1981 novel The War of the Roses by Warren Adler. The film, which  co-stars Michael Douglas, Kathleen Turner and Danny DeVito chronicles the demise of a marriage  against the backdrop of a beautiful home that the couple, literally fight to the death over.  Trust disputes can be … Continue reading

Taxation of Trusts ed 3

  The taxation of trusts is a dynamic and ever-changing landscape. The third edition of Taxation of Trusts published this week (September 2016) has been up-dated to incorporate recent case law developments and legislative amendments.  The text also considers the application of FATCA to trusts and proposed new reforms to the disclosure rules and closely … Continue reading

Emerging failure

Mr White established the Rex White Family Trust (the Trust) in 1992 to hold an inheritance he  received from his mother.  The trustees of the Trust were Mr Davis and the solicitor who prepared the trust deed, Mr McNiece (together the Trustees). Mr White’s wife was not aware of the trust at the time, although she had … Continue reading

The Supreme Court Writes Back

The long-awaited decision (issued in fact as two separate decisions) in Clayton v Clayton were released today (23 March 2016). The first decision relates to the Vaughan Road Property Trust (VRPT) and the second to the Claymark Trust. Background Mr and Mrs Clayton commenced a de facto relationship in 1986 and married in 1989. They … Continue reading

The new wave of trusts?

Work Safe New Zealand.New Zealanders are reported to have more trusts per head of capita than anywhere in the world.  Whether this is true or not cannot be verified as there is no register of New Zealand family trusts. The secrecy that surrounds trusts is one aspect of why they have remained so popular.  While … Continue reading

Dis-illusion

The long awaited Court of Appeal decision on the subject of illusory trusts should make unsettling reading for many a settlor, and perhaps their advisers too. The decision, which runs to 96 pages is substantial.  The message is mixed.  While the trust in question was found to be valid (illusion it turns out, is just … Continue reading

Current accounts may make beneficiaries settlors for tax purposes

On 22 December 2014, Inland Revenue released draft Public Ruling PUB0209: “Income tax — whether a beneficiary will be treated as a settlor”.  The Public Rulings consider whether a beneficiary of a trust who has a current account can be a “settlor” of the trust for income tax purposes under s HC 27(2)(a) or (b) of the Income Tax Act 2007.  … Continue reading

Do it right or don’t bother?

Trusts are a bit like plants – tend them and nourish them and you can reap the rewards for years.  Leave them alone and even if once well tended to, the plant can bolt or fail.  The story that became  Murrell v Hamilton provides a sad example of what can happen when trustees fail to collectively … Continue reading

No sham decision upheld

The Supreme Court has dismissed an appeal against the decision of the Court of Appeal (upholding the High Court decision) in Glover v Glover where the court found that a ruse was not a sham.  Briefly a bare trust arrangement entered into to avoid a tax impost was found to have achieved its object and accordingly … Continue reading

You go, no you go

Trustees do not always get on as well as is necessary to do the job of being a trustee.  Friction in the trustee relationship can arise for many reasons, often, but not always, the friction relates to the break down of a family relationship. When trustees cannot get on the issue to be determined is … Continue reading