This tag is associated with 6 posts

Is it tax avoidance to distribute to the beneficiary best able to benefit?

QB 15/11: Income tax – Scenarios on tax avoidance – 2015 gives examples where trustees of a discretionary trust take into account the tax position of the beneficiaries when making decisions about distributions of beneficiary income; and finds that this is not tax avoidance.   However, there are some important caveats, and the question to consider when any … Continue reading

The grammar of trusts

Trusts are commonly anthropomorphised – my trust, the trust, his trust.  At the very least the trust becomes a possessive noun rather than the inchoate mix of rights and obligations that a trust really represents.  It is difficult of course, to separate out the parties.  Because most of the time – who cares?  Does it … Continue reading

1 of 2 Trustees personally liable

Guarantees are a common part of commerce.  In a practical sense they are often unavoidable.  Shareholders guarantee loans to companies; settlors guarantee loans to trusts – there is a certain symmetry because the shareholder or settlor is able to ultimately benefit from the advance.  But what about when the trustees who are asked for a guarantee cannot … Continue reading

Executors’ obligations to account

The role of executor of an estate and the on-going responsibilities and obligations are not always well understood.  Where there is a legal advisor the executor may be well schooled in the relevant obligations and the administration of the estate can be expected to proceed in a timely and proper manner. However, sometimes this is not … Continue reading

To forgive, divine

When Alexander Pope wrote “To err is human; to forgive, divine” it is doubtful that his mind was turned to matters equitable.  However, the expression is an apt description of the recent decision in Official Assignee v Mayers. This case considers whether the Official Assignee can recover gifts made by way of forgiveness of debt prior to … Continue reading

Extent of professional trustee liablity

The New Zealand Institute of Chartered Accountants (NZICA) is warning professionals that the Inland Revenue Department (IRD) is actively pursuing trustees personally for tax debts owed by a trust, including those trustees with no personal connection or interest in the income or assets of the trust. NZICA says it is aware of a number of … Continue reading