The 2014 Finance Bill - Inheritance tax and trusts

Inheritance tax
  • Freeze of nil-rate band at £325,000 extended to 2017/18.
  • Changes to dates for delivery of accounts and payment of tax by trustees.
  • Income in ‘relevant property’ trusts treated as capital for the ten-year anniversary charge if undistributed for five years.
  • Cultural gifts scheme: correction of a technical flaw relating to gifts of objects with latent estate duty liability.
  • Funds held in foreign currency accounts in UK banks treated in the same way as offshore accounts for the purpose of deducting liabilities of an estate.

Other
  • Capital gains tax (CGT) uplift on death extended to trusts for the benefit of vulnerable persons in certain cases where the beneficiary has no absolute entitlement to the income of the trust.
  • Trusts with vulnerable beneficiaries: definition of ‘disabled person’ adjusted to take account of changes in welfare benefit rules.