Malcolm Finney ponders the different definitions of the term ‘settlement’.
Unfortunately, there is no single definition of the term ‘settlement’ for all tax purposes; the definition depends upon which tax is under consideration, although there are similarities across the definitions.
Therefore, to analyse the tax effects of a particular set of circumstances, it becomes necessary to be clear as to whether a settlement has been created or not.
What does it mean?
For income tax purposes, the term ‘settled property’ is defined as ‘any property held in trust…’ (ITA 2007, s 466). But note that for the purposes of ITTOIA 2005, Chapter 5, ITTOIA 2005, s 620 defines ‘settlement’ as ‘[including] …. any disposition, trust, covenant, agreement, arrangement or transfer of assets …
