Seeking technical advice from Trusts & Estates Technical (Trusts)
Technical specialists based in Bootle and Edinburgh are part of Technical and Valuation. They advise on the issues covered by the TSEM. Their subject areas are:
- UK resident trusts and Income Tax
- non-resident trusts
- the settlements legislation
- deceased estates administration periods
- beneficial ownership and Income Tax
For a full list of subjects see below.
Trusts specialists in Technical and Valuation do not advise on Capital Gains Tax for UK resident trusts or on Inheritance Tax (IHT). However, IHT specialists in Technical and Valuation do advise on IHT - IHTM01081). Refer any doubt, difficulty or dispute on other taxation points (for example trade profits, property income or chargeable gains) to the relevant specialist office for advice.
Technical and Valuation (Trusts) specialists provide advice to HMRC colleagues and do not usually communicate directly with taxpayers or agents, although they may do so on occasion.
Technical and Valuation (Trusts) subject list and office
|Subject||TSEM reference||Trusts & Estates Technical office|
|Income Tax and trusts||Edinburgh|
|law of England and Wales trust deeds and questions on the reading of trust deeds||Edinburgh|
|Scots law trust deeds and questions on the reading of trust deeds||Edinburgh|
|whether a trust exists/whether a trust is valid (other than in the context of TCGA92/S225)||Edinburgh|
|interest as an allowable trust management expense||TSEM8730|
|trust management expenses issues not covered by TSEM guidance||TSEM8000+||Bootle|
|non-resident vulnerable person who is physically disabled||TSEM3454||Bootle|
|vulnerable beneficiaries - notice of determination||TSEM3481||Bootle|
|other vulnerable beneficiaries issues not covered by TSEM guidance||TSEM3400+||Bootle|
|mineral royalties received by trustees||TSEM3196||Bootle|
|potential rectification cases||TSEM1902||Edinburgh|
|potential Hastings Bass cases||TSEM1904||Bootle|
|trusts for particular purposes||TSEM5000+||Edinburgh|
|effect of the application of foreign law||Bootle|
|residence of trustees||TSEM1465||Bootle|
|non-resident trusts - branch, agency or permanent establishment||TSEM1461|
|non-resident trusts and Capital Gains Tax||Bootle|
|extra statutory concession A93||Bootle|
|extra statutory concession B18||Bootle|
|transfer of assets abroad||Bootle|
|settlements legislation apart from capital sums paid to settlor||TSEM4000+||Edinburgh|
|settlements legislation capital sums paid to settlor||TSEM4400+||Edinburgh|
|Income Tax repayments to minor children - RM3680 onwards, including cases where a pension is payable to a minor child following the death of a parent||Edinburgh|
|estates in administration||TSEM7350+||Edinburgh|
|in the case of estates, questions about whether the individual(s) occupying a private residence held by personal representatives had a ‘relevant entitlement’ in the whole or any part of the net proceeds of disposal (s225A TCGA 1992)||Edinburgh|
|Income Tax issues arising from the ownership or joint ownership of property - this could include tax on rental income, bank or building society interest, or dividends||TSEM9000+||Edinburgh|
|bare trusts and declarations||Edinburgh|
Informal query or formal submission?
Whatever the subject, if the facts are simple or the issue easily explained, you may make an informal query rather than a formal submission.
In particular, if a nominated deeds officer in Trusts & Estates wants advice on the status of a trust, i.e. whether it is bare, interest in possession, accumulation/discretionary or settlor-interested (TSEM1711, TSEM2160, TSEM1562), there is no need to make a formal submission. The nominated deeds officer should simply submit a copy of the trust deed along with a completed deeds stencil 2 (Edinburgh).
Whatever the subject, if the facts are extensive and/or the issue is complex you should make a formal submission (word 43KB) - see below for full details
In particular if you want advice on trust issues other than status, such as the operation of trust tax law or general trust law, your query may require a formal submission.
After your initial formal submission, subsequent contacts with Technical and Valuation (Trusts) can be on a less formal basis.
When to refer to a technical specialist
When you have obtained all the relevant facts you should aim to resolve technical problems using HMRC manuals such as the TSEM and other guidance (for example, the tax return guidance notes and help sheets) together with the expertise available in your office. If you remain unable to resolve the problem you can seek advice from a technical specialist.
Refer cases early where an issue has new or unfamiliar features, or it flows from a transaction or transactions that are structured in an unusual way. The specialist will want to be alerted about these cases even if your office believes it knows the correct answer and/or not all facts are known.
Do not refer hypothetical cases.
You should confine each request to one subject.
To help the specialist give you the best possible service, please ensure that you prepare your request for advice thoroughly. Keep in mind the possibility that any case on which you seek advice could potentially lead to a tribunal hearing and should be prepared properly from the start.
- you get all the relevant facts
- you have looked at any relevant legislation
- you have checked that the manuals and other guidance do not provide the answer to your problem
- you have checked that no one else in your office has the knowledge or experience to help
- the point of principle, or the tax or NICs at stake, merits further detailed consideration
in a formal submission (word 43KB), you obtain approval as required
How to contact technical specialists
You may seek advice from a technical specialist by:
Contact details (name and email address) are given on the Specialist PT intranet site, Technical Contacts list. Postal addresses are given at TSEM1421.
A phone query will sometimes be the best means of seeking advice. For instance, your query may be urgent, or it may involve an issue that is easily explained. A phone call may be used for an informal query. A phone call is not a formal submission.
If you have prepared your question thoroughly and taken local advice, the specialist will be happy to discuss it with you. The technical specialist may request sight of documents, or a formal submission (word 43KB) so that the problem can be considered in greater depth.
Contact by email
You may prefer to email the technical specialist, for example if the relevant specialist is not immediately available, or you want them to look at a document, or the issue is complex. You may make an informal query by email. You may also make a formal submission (word 43KB) by email, but you must ensure that you follow the guidance below, and attach all relevant documents. If you do not provide all relevant documents by email, the technical specialist will ask you to submit your file, which will add to the response time. To avoid this, you should phone the technical specialist first to discuss what documents he or she will need to see.
Documents: if a relevant document is not in electronic form, you should have it scanned and attach it to the email. It is helpful to date and name all documents including pdfs descriptively, for example, ‘990630 Westward trust deed’, particularly if you are attaching more than one.
Contact by post
This is not normally necessary. Using email is faster and more secure, and more convenient for the technical specialist. But if there is a large volume of material, post may be preferable. You may make a formal submission (word 43KB) by post.
Documents: number relevant correspondence if there are more than a few items, and use flags if referring to items in your submission.
Data security: send only what you need to make your submission. In most cases you will not need to send the whole file. In particular, if your initial submission included the file, you should not submit it in subsequent submissions unless the technical specialist asks to see it again. Subsequent submissions should be by email, attaching any new correspondence in electronic or scanned form. Send any hard copy submission in an orange polylope via TNT to the full postal address - including postcode - of the receiving office (see TSEM1421) and contact the recipient to confirm that the papers have arrived safely
If the facts are extensive and/or the issue is complex, you should make a formal submission to the relevant specialist. You should use the template (word 43KB) provided to make a formal submission by email, in Caseflow cases, or post. Refer to the template notes below, before you start.
You should ensure that the submission is approved by your manager or the appropriate person in your office.
Complete the formal submission (word 43KB) template and attach it to the Caseflow record.
Send an email with the Caseflow reference number to the group mailbox - Mailbox, Trusts Technical (Specialist PT) - to alert the technical team to the fact that a Caseflow case has been referred to them for advice. Insert in the email subject-line the subject-matter of the referral: trusts/settlements/estates/ownership and the Caseflow ID (CFS-**)
If the referral relates to a non-resident trust or the application of the transfer of assets abroad legislation, then the email should be sent to Stuart Atherton (‘cc’ Ian Keenan) of the Technical and Valuation - Non-resident Trusts and Transfer of Assets Abroad team in Bootle.
The technical specialist will access the submission and any other documents through the Caseflow record. In due course the specialist will:
- attach their advice to the Caseflow record
- email you to let you know it’s there
- tell you the total time spent on the case to the nearest 15 minutes and their grade.
Keeping taxpayers informed
Our service standard says that we will inform customers if we are unable to provide a complete reply within a target turnaround time. Where it is necessary for you to seek advice you should send an acknowledgement. Do not tell taxpayers or their agents that you have referred the matter to a specialist unless you have confirmed with the specialist that you can. If you need to do more than send an acknowledgement, tell them that you are asking for your manager’s advice. There are two reasons for not disclosing that you are seeking advice:
First, it undermines the standing of your office - in the future agents and customers may be less likely to accept your view without specialist confirmation. Please remember that specialists provide guidance in confidence for you to use in resolving the issues arising in, and circumstances of, the case concerned. You should refer to the specialist again only if there is a genuine need for further advice, obtaining approval in the same way as for the original referral.
Second, there may be difficulties of which you are unaware relevant to the point at issue - such difficulties can affect case handling and practical solutions can become more difficult once an agent knows that a specialist is involved.
Decide whether the request is routine or urgent, and state either
‘This request is routine’
‘This request is urgent because….’, and specify why, for example it is a complaint case. If there is an important date imminent, state that.
This should be a brief summary - one or two sentences only. It should identify any general and/or tax law issue and the potential tax consequence/s. Examples:
‘whether a receipt by trustees of mineral royalties is capital or income in trust law and consequently whether it is chargeable to income tax on the trustees or alternatively on the life tenant’
‘whether a trust exists of real property such that A and B are equally entitled to the rental income and consequently taxable on the income in equal amounts’.
‘whether or not the terms of the deceased’s will create a testamentary trust over the residue of the estate’.
Set out a numbered list of purely factual material, not including inferences or arguments, and one fact per number. If the case goes to the tribunal, we should be able to put every entry on the list to the appellant in our list of facts ‘not in dispute’. Include what actually happened (events involving the taxpayer) and what HMRC did, for example ‘Local Compliance opened an enquiry on 1 June 2012’. Set out details in numbered paragraphs as follows: 6.1, 6.2, 6.3 etc.
Please relate the facts to specific documents if attached. If making the submission in hard copy, please use flags to identify relevant documents.
7. Assessments and appeals open/Section 9A enquiries made/Revenue amendments made
This information can help ensure HMRC does not miss deadlines and avoids having to issue ‘discovery’ assessments (See TSEM2120).
Set out details for all relevant years separately, in numbered paragraphs as follows: 7.1, 7.2, 7.3 etc.
8. List of appropriate legislation and manuals consulted
Start off with the relevant legislation, for example ITA 2007/S479.
List any guidance manuals you have referred to, specifying the relevant section/s, for example TSEM4125.
List any other sources you have referred to, for example case law not already mentioned, or Revenue & Customs Brief XXX
Set out details in numbered paragraphs as follows: 8.1, 8.2, 8.3 etc.
9. Inferences of fact and argument
Set out the taxpayer’s arguments and HMRC’s arguments in turn, based on the relevant legislation and facts in the case. End with your view of what you think the technical answer may be: conclusion. Set out details in numbered paragraphs as follows: 9.1, 9.2, 9.3 etc.
10. Tax at stake
Explain the tax that would be due for all relevant years
10.1 on the taxpayer’s basis
10.2 on HMRC’s basis
10.3 the tax at stake - the difference between 10.2 and 10.1
11. Wider implications
Use this section to set out anything that might have wider implications than this case. State whether there are other similar cases under enquiry, and if so, what the total tax at stake is. Even if there is not much tax at stake in this case, is there a point of principle at issue? Is the case sensitive? Have you considered the Litigation & Settlement Strategy? Are you aware of any relevant submissions to other technical specialists or Solicitor’s Office? Do you think this is a new form of avoidance? If there is an existing avoidance scheme please give the Scheme Registration Number.
Before submitting the request, you should obtain approval from your manager or the appropriate person in your office. Ask them to approve the submission by adding:
12.1 their name and role
12.2 their view if any on the technical issue
12.3 the date.