• Contact
  • Accountants: +44 (0) 1753 551111
  • Solicitors: +44 (0) 20 7067 4300

Trusts - Ironically something that is not that trusted by the public.

Posted on: 29 Jul, 22

In reality a concept that no one understands very well. Some of us have them. Some of us don’t even know we have one. But whatever the situation, you now need to declare them on a new Trust Register. Oury and Clark are on the case to unriddle. What is a Trust, and why this new Trust register is something you need to be aware of.

Oury says...

It’s over God damn it

What’s “Over”?

Clark says...
Oury says...

Our British ability to be completely transparent, yet utterly secretive at the same time. The Swiss just straight up admit it - that they hide people's money and “No. we won’t tell you whose it is”

Oh yes … “”non. Nous ne vous dirons pas de qui il s'agit"

Clark says...
Oury says...

Well, they could be Swiss German or Swiss Italian.

Oh yes… well the Italian would be “no. Non ti diremo chi è”

Clark says...
Oury says...

Well done. You can officially use google translate. But yes. Unlike the Swiss who somehow have managed to project this squeaky-clean image through filling our airports with triangle chocolate and Swatches. The Brits had a more cunning plan - we will be absolute transparent. Except if it’s in a trust - which in that case - no you can’t find out anything.

What the hell is a trust Clark? I pretend I know. But I don’t.

Clark says...
Oury says...

Ultimately my financial friend it’s a contract. Usually a document signed in deed (means it’s witnessed) that says … I am taking this asset, or money or whatever I own (the “settlor”), and I am putting it under the trust of these three people (“trustee”) who need to look after it for the benefit of these other people (“beneficiaries”).

Oh nice. It’s like a complicated IOU note. Or the pub version would be… I am not taking my wallet while I go to the shops for some cigarettes. I am putting it in the trust of my friend Terry who is going to buy a round for any guests that arrive while I am busy angrily shouting at google for leading me to a corner shop that closed during Covid.

Clark says...
Oury says...

Exactly. When you return you expect your wallet back in your scenario, which is actually very similar to how they were used when they were invented in English Law. During the Crusades in the 12th and 13th centuries - when a landowner left to fight, he would put his lands in the trust of a keeper, who got the income, and had to look after the land, but when he got back obviously, he wanted his land back.

Did they get it back?

Clark says...
Oury says...

No, often not. They didn’t because English law at the time said they were now owned by the trustee. So, they had to petition the King, and get referred to the Lord Chancellor, who just decided as he wished. This went on for a while until people got pissed enough, that something was done - and the concept of “equity” was born in English law.

Didn’t we nick that of Aristotle ?

Clark says...
Oury says...

I am pretty sure everything the Greeks did we plagiarised - including the word plagiarised!

Oh right. I thought trusts were invented by rich MP’s to be able to leave money to their illegitimate children because everyone had mistresses back then...

Clark says...
Oury says...

Ah very good - that’s actually known as a “Secret trust” and is to be fair, a fairly reasonable use for them. You might not agree with the Mistress, but ultimately what’s done is done, and it isn’t fair either that someone wasn’t able to leave money to their children because they would have got into trouble with their other half. Life isn’t all peaches and cream, and sometimes you have to burn gasoline to build your future dreams - as someone once said.

Who said that?

Clark says...
Oury says...

Oh okay, I just came up with it - but you take my point?

Yes. Basically, trusts are a way of taking something you have, and of putting some people in charge of ‘sort of’ giving it to someone else in the future, but not necessarily being able to get it back or know whether they will get it.

Clark says...
Oury says...

Pretty much. They are unpredictable. A good analogy is you are throwing a ball. The ball representing the asset or money. You can choose where to throw it, you can aim really carefully. But the moment it leaves your hand it’s out of your control. You have these trustees there to try and make sure it goes where you wanted, guiding it in the air if you like, but they are pretty limited and aren’t necessarily that good at the job.

Nice. Okay - so I’m clear on a Trust. So, what’s happened? What’s “over” ?

Clark says...
Oury says...

Well, somehow - all of the trusts that are out there - all of them - now need to be put on a register.

Is that bad?

Clark says...
Oury says...

Well, it’s probably fair enough ultimately, but it’s an absolute bloody nightmare to work out who has one. Trusts are just contracts. Sat in drawers, or not even in a drawer because it could be your grandmother set up an investment trust no-one knows about. In any case - forgotten about. How the hell are we going to know where they are, how many there are, and get people to put them on the register?

Yeah, and guess who gets the blame if we haven’t registered it. Your friendly professional adviser. Who’s looking at this register anyway?

Clark says...
Oury says...

Well surprise surprise your friends at HMRC!

HMRC ! Of course. I knew it ! Trusts must drive them mad, never knowing who actually owns anything. They must be loving this. Are you saying that if you don ’t put it on the register, HMRC could try and refuse that it existed?

Clark says...
Oury says...

Well, it would seem unsurprising if that was the case. Ultimately, it’s a public register we believe. They are trying to get Britain squeaky clean because well, if you are not a country with common law (former colony mostly) - then you don’t have a concept of trusts.

Europe doesn’t do trusts?

Clark says...
Oury says...

Goodness no. Napoleon would have hated them. He wanted everything stamped and approved and controlled. They have no concept of them, they think they are some bonkers dodgy British thing like pickled eggs.

Nothing wrong with a pickled egg. Do off shore territories need to follow these rules?

Clark says...
Oury says...

It applies to overseas trusts if they have a UK tax charge, own UK Land and Property OR if they have a UK Trustee with business relationship with a UK Advisor.

Woof what a strange rule - that just put some lawyers out of work in London

Clark says...
Oury says...

Perhaps ! Anyway, it’s probably for the best the way public sentiment is on these things. But here is the thing. No-one is even talking about it in the press... the public is dead to it. Think how many messages there were about Brexit… and still no-one did anything … Now we’ve got to tell everyone to dig out their trusts deeds or be damned… You know sometimes I wonder whether we really even need trusts anymore, are they really a good idea at all?

Whoa whoa - chill your boots Mrs Legal beagle. There are a couple of really important uses of trusts for tax…

Clark says...
Oury says...

Like what?

Well. That would be telling!

Clark says...

Comments (0)

Add a new comment





To use reCAPTCHA you must get an API key from http://recaptcha.net/api/getkey

Allowed tags: <b><i><br>Add a new comment:


We are but two fictitious characters throwing out ideas and comment to stimulate debate and collect information. As professional service firms, we are open minded people and think independent thought and debate is essential to help understand, as well as navigate, complex problems. By joves – doing business across Europe (and the world) is set to become a whole lot more complex in light of recent seismic political events. As businesses - we provide information and hopefully some wisdom - and we see this blog and its caricatures merely as a much more fun, perhaps slightly controversial way, of stimulating debate and collecting ideas. We’re searching for some true pearls of wisdom, and as we find them, we’ll share them with you.

Sign up to Our Monthy Newsletter

To recieve the latest blog posts straight to your inbox please sign up here

Need some help?

If your business is affected by issues raised in this blog post and you're looking for advice, please get in touch.

Get in touch
  • Member of London Partners
  • Member of London of Chamber Commerce and Industry
  • The Royal South Bucks Agricultural Association
  • The Association for UK Interactive Entertainment
  • Offical Xero Partner

Copyright © 2013 - Oury Clark.