I am instructed by Trustees in relation to the administration of a Personal Injury Trust. The Trust is a Discretionary Trust and a number of years ago the accountants that complete the tax returns for the trust advised us that we should make a vulnerable person election. Although the trust is discretionary the injured person is the only beneficiary receiving any benefit (income or capital) from the trust. That beneficiary is in receipt of qualifying benefits.
The accountant has recently contacted me and advised that they will not be able to make the vulnerable person election this year. Apparently, they have recently received correspondence from HMRC in relation to a similar trust rejecting the vulnerable person election on the basis that the trust is settlor interested.
The beneficiary is the individual that received the personal injury award and, accordingly, the settlor of the trust.
Has anyone else a similar experience?
Langleys Solicitors LLP