Malcolm Finney looks at a case where a fortunate trustee avoided a £1 million tax charge.
Family trusts in tax planning are very common. Those appointed trustees are often family members, and many do not appreciate the onerous responsibilities that go with becoming a trustee. The case of Mackay v Wesley [2020] EWHC 3400 (Ch) is a salutary lesson in this regard.
Trust gains
The case concerns a settlement set up by Ellen Morris in 1990, which was resident in the Isle of Man. David Wesley and his wife were principal beneficiaries. A £1.6 million capital gains tax (CGT) liability subsequently arose in tax year 2002/03 on the part of the trustees (under TCGA 1992, s 65), but it seems that only one of the three trustees, namely Mrs Mackay, had any assets available to settle the
