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HMRC internal manual

Capital Gains Manual

Conventional but bare trusts: Scotland: special cases

In Scott v Scott, [1930] SC903 it was held that where A created a trust in favour of a future wife and children it was a trust for administration only and the property was fully at his disposal. Therefore if the case had concerned CGT it would have been regarded as within TCGA92/S60.

The principle of the trust for administration can also extend to other cases where there is a remainder to a specified person. For example, P may create a trust giving himself a liferent until he reaches a particular age, say 50, at which time he is entitled to the capital. If he dies before that age the property goes to Q. If it is a trust for administration he can claim all the property despite the interests of Q. The principles for identifying a trust for administration are complicated, and if necessary advice should be sought from HMRC Trusts and Estates (Edinburgh).