Out of trust?

[Nic232]

The objective is indeed specifically to end the trust.

What are the tax implications in ending the trust?

[Tofros]

How about something along these lines…

My fathers will, attached leaves his house on trust for sale subject to a right of occupation for my brother. Copy of will attached.

my brother and I are executors/trustees and sole beneficiaries of thetrust for sale.

my father died on x date. We have obtained probate but have not taken any steps to administer the property. The estate comprises the house, value X, chattels in the house, and cash of x.(whatever you put on the probate application)

My brother and I would strongly prefer a simpler alternative to holding the property in trust subject to his right of occupation, whilst preserving my interest in the proceeds of eventual sale. I live abroad and am worried about potential future problems and liabilities which may arise from the trust structure.

I gather it is possible for the beneficiaries of a will to agree to vary the will by deed executed within two years of the testators death, and that it has effect as if the will always said what the deed says about the affected parts and that the variation to be effective for IHT and CGT purposes.

It has been suggested to us that an alternative might be for my brother to receive the entire house subject to a charge in my favour for half the value and that it might be possible for this value to be index linked in some way so that future gains in property value are shared between us.

Could you please advise whether this is possible and the tax consequences of doing so.

Could you please also suggest any different/better arrangements which would have the same practical outcomes in terms of my brother getting to live in the house for as long as he wishes and us sharing the eventual proceeds of sale of the house but without involving a trust or us being registered co-owners.

[Nic232]

Tofros - thank you sincerely for your help.