Forced sale of family trust property under Labour plans?

by Helen

15:58 PM, 15th October 2019
About 4 weeks ago

Forced sale of family trust property under Labour plans?

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Forced sale of family trust property under Labour plans?

I am trustee of a family discretionary Trust, providing rental income to various beneficiaries.

Under Labour’s proposed plan to allow tenants to buy the property they are renting, will the trustees of this Trust have to agree to the rental property being sold to the tenant. Which as far as the Trustees are concerned is detrimental to the beneficiaries and wishes of the settlor who wanted to create an income stream for the beneficiaries.

In other words, will the trust offer protection against property having to leave the trust, against Trustee wishes or is any law change likely to be at least retrospective and not affect property placed in trusts before any new legislation?

Many thanks

Helen

 



Comments

Neil Patterson

16:01 PM, 15th October 2019
About 4 weeks ago

Hi Helen,

This was a conference policy motion I believe voted on and passed, but without any firm criteria or details of the rules and figures. We are unlikely to know anything definitive until the next general election, which could be very soon and see Labour's Manifesto.

JJ

10:48 AM, 16th October 2019
About 4 weeks ago

One of the difficulties for property owners of the present labour proposals (and there are many) is that a forced sale when you do not want to not only potentially takes away your rights to the future value of the investment and any revenue streams you may get from that, it also produces a tax liability at at time that is not of your choosing: For many property investors if there is a CGT liability they need to be able to choose a time when the rest of their income is low.
With trusts, some trusts are no longer subject to inheritance tax, but some trusts pay income tax and capital gains tax at higher rates. It's important to know what type of trust you have.

Dr Rosalind Beck

12:17 PM, 16th October 2019
About 4 weeks ago

It is impossible to answer this question. The extremists in control of the Labour Party would not give a fig about trusts and income streams. All bets would be off as private property rights were effectively abolished. McDonnell has previously said that he wants to see the overthrow of capitalism - this can only mean that he wants it replaced with communism and indeed some of the key advisors to the extremist leadership are former communists who have entered the Labour Party with the aim of turning it into a communist party. We must all do whatever we can to make people realise that they cannot vote for this party. Former Labour MPs such as John Mann and Ian Austin have pointed this out, amongst others.

JJ

12:26 PM, 16th October 2019
About 4 weeks ago

Reply to the comment left by Dr Rosalind Beck at 16/10/2019 - 12:17
Dr. Beck is correct: This isn't a problem for the type of left-wing militant extremists presently running the labour party, and it may not be a problem for many of the people now supporting the former liberal democrats who have committed themselves to the redistribution of assets anyway.

Just as Gordon Brown raided personal pensions, and didn't care because he saw personal pensions as the preserve of the 'rich', left-wing extremists in both the labour and liberal parties are likely to attack property. The small number of people in these parties with enough intelligence are likely to be able to understand that attacking a UK person's right to hold their principle private residence free of tax during their lifetime (although they are likely to attack them through inheritance taxes) is not going to get them elected.

But if they got elected they would be likely to go after assets held in trust, including pensions which are assets held in trust, and residential properties held by landlords and trusts, many of which are being used as pensions anyway.

That potentially affects very large numbers of people but the extremists will not care.


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