CAPITAL Letters - Issue 27

Offshore trusts: how protected is 'protected'?

The remittance rules used to be both easy to understand and apply but, following the 2008 reforms to the taxation of non-doms, significant revisions were made and are now embodied in the alphabet soup that is section 809 of ITA 2007. To say this section is hard to follow is an understatement – even the numbering is bewildering. For instance can you tell me if s.809EZDA comes before or after s.809AAZA?

Anyway, buried amongst this alpha-numeric maze is s.809L which tells you what ‘remitted to the UK’ means and it makes clear (sort of) that money brought into the UK by a ‘relevant person’ will be taxable upon the taxpayer. Section 809M gives the meaning of a relevant person and this includes the trustees of a settlement of which that person is a settlor.