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HMRC internal manual

Trusts, Settlements and Estates Manual

Introduction to trusts: legal background - trust law: whether a trust exists

The existence or validity of trusts is the technical responsibility of Trusts Technical Edinburgh.  If you have opened an enquiry, and particularly if you are taking a case to Tribunal on this issue, you must consult Trusts Technical Edinburgh at an early stage.

Whether a trust exists

This issue usually arises in the context of bare trusts, but may arise in the context of non-bare trusts.

Sometimes taxpayers claim that they hold assets on trust for someone else. If there is no formal trust declaration or deed to support such a claim, or any declaration or deed appears questionable, the claim may be open to doubt. If you are unsure whether a trust exists in a specific case, and it is material for any tax purpose, subject to what is said below at ‘Exception’ , consult the guidance in TSEM9500+ and TSEM9912.  If the guidance does not provide the answer you must submit the case to Trusts Technical Edinburgh. 


If the tax issue is private residence relief (TCGA92/S225), consult the guidance in CG65400+.

Validity of written trust

If a trust deed is invalid, it can mean the trust does not exist.

If in the course of a compliance check or repayment claim (see TSEM2160)  you are looking at a written trust declaration or deed, and you have doubts or questions about its validity, for example:

  • the formalities of signing and witnessing appear incomplete, or
  • the beneficiaries or trust property do not appear to be identifiable

consult Trusts Technical Edinburgh.