This book, published under the new Bloomsbury imprint following its acquisition of Tottel Publishing, is described in the author’s preface as intended for those advising ‘average’ middle income clients whose house is worth in excess of the available nil rate band, but who do not hold a great deal of wealth outside the family home.

This is a promising start as many clients will fall into this exact category. They do not want to pay inheritance tax, but do not have sufficient assets to implement complex tax planning schemes, nor do they simply want to give it all away.

The first 21 chapters of the book serve as a brief reminder of the basic principles involved in calculating inheritance tax and capital gains tax liabilities in respect of trusts, lifetime giving and death estates. However, this part of the book is more a point of a reference than an actual practical guide; if you needed to be reminded of how the rules apply to immediate post-death interest trusts you may find the answer here, but if you require detailed worked examples you may be disappointed.

Nevertheless, the title of the book suggests that it is intended as an aid to planning and, taking it in that context, the supporting introductory chapters are clear, concise, and also contain very useful end-of-chapter summaries bringing out the main points.

The planning section of the book comprises probably half the volume, although this part has been divided into much broader chapters than the first part. The advice contained within is relevant and suited to the target client but, as with the introductory chapters, this is more of a reference work on tax treatment than a planning guide.

The chapters are widely drawn and each contains numerous different issues that can make it difficult to identify specific ideas from within a larger remit. Having said that, the author clearly identifies problem areas, complications and possible variations of a number of the ideas discussed. In particular, the question ‘is this of any use now’ is oft en posed in the will planning chapter, where the advent of the transferable nil rate band may render such planning ineffective or not worthwhile.

This book is an adequate reference material, and may be of use in identifying some of the issues applying to clients but it would not necessarily give the reader confidence that all options had been explored.

Reviewed by Sam Hart
Taxation Magazine, January 2010

There are two levels of knowledge: the active level such as demonstrated recently by Emma Chamberlain and Chris Whitehouse on the subject of Pre-Owned Assets, and the passive level, demonstrated by most of the rest of us when we think (but do not say) “Well yes, I knew that”. Those with an active level of knowledge will probably not wish to buy John Thurston’s latest book, one of the first to emerge from the Tottel publishing stable. It is aimed at solicitors, accountant(s?), independent financial advisers and all those others who are frequently asked to advise the client who would not claim to be rich but who is nevertheless concerned about Inheritance Tax.

John has set himself a formidable task and has had to exercise great editorial control in deciding how much detail to include. He addresses the main issues of IHT, CGT and income tax as they affect estates on death and trusts. He then considers the advice that may be given to mitigate the burden of those taxes. All this is achieved in only 173 pages. Therein lies the rub. The “proposed” modernisation of the taxation of trusts, which is now well underway, merits one page and the exposition of the pre-owned assets regime two and a half pages.

This, then, is an introduction to the subject rather than a detailed exposition of it. It will serve very well as training for junior staff. For example, as with some of John’s other books, the sentences, paragraphs and chapters are short. Each chapter concludes with a summary of a few bullet points. There is much in this book that I would like to emulate in the training manual for the examination on the taxation of trusts and estates for the STEP England and Wales Diploma. In particular the text is absolutely littered with strong, clear, relevant worked examples. For that reason alone, every firm that conducts work in the area of trusts and estates should have one copy of this book available as a first point of reference for practitioners who are not quite sure about taxation issues in this area.

The book will, however, only be a first point of reference. For example, the chapter on CGT on trusts carefully and accurately describes the charge that will apply when a beneficiary becomes absolutely entitled but does not, in the initial exposition, go on to examine the possibilities that are opened up by Statement of Practice 7/84. In describing the charges to CGT on accumulation and maintenance settlements, the treatment is entirely accurate and shows how the ability to hold over gains is limited where the beneficiaries acquire an interest in possession long before they acquire the capital. John does not “go the extra mile” to show how matters might be arranged to achieve holdover in these circumstances.

The book is dated 2005 and John hopes that, this being the first edition, there will be subsequent ones. If there are, there will be the opportunity to update statutory references, for example s66A(1) Income and Corporation Taxes Act 1988. All of us are having to come to terms with the new section numbers in ITTOIA 2005 as well as matters such as the new code for trusts for the vulnerable.

The second part of the book looks at planning possibilities. All of it is good, sound, conservative stuff. There are appropriate warnings in relation to the more esoteric ideas. No-one can speak for the Paymaster General, but I suspect that even she would approve of the way, in chapter 32, John Thurston sets out his own moderate views. Those views will be shared by many TEPs, whose main concern is to give sound, if perhaps unimaginative, advice.

The book does not contain precedents for tax planning. That would be outside its declared scope. It is thus effectively a stepping stone from the kind of tax planning article that regularly appears in the financial pages of the weekend press to the more specialist works on tax planning. The 7 pages on Business and Agricultural Property Relief will give the practitioner some useful pointers in the direction of cases that will be relevant to daily practice. This is a book that people will not just buy. They will actually read it and profit from it.

Toby Harris is a member of the Norwich and Norfolk branch and may be contacted at www.tobyharris.co.uk. He is the author of Tolleys Business and Agricultural Property Relief.

Toby Harris. STEP Journal

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