A summary of key legal updates in the Private Client sector over the past two weeks is as follows. 

Tax Policy

The government has responded to the "Tax After Coronavirus" report, published by the Treasury Committee in March 2021, and rejected several of the suggestions; in particular, that SDLT should be significantly reduced. Whilst they took on board the suggestion (advocated by STEP) for a government "roadmap" for personal tax, the response was that it was "not always appropriate…to pre-announce tax reforms given the issues caused by forestalling activity". https://publications.parliament.uk/pa/cm5802/cmselect/cmtreasy/144/14405.htm#_idTextAnchor010

OTS reviewing tax year end date

On 4 June 2021, the Office of Tax Simplification published details of its review into moving the tax year end date for individuals from 5 April to 31 March. This would align with the UK financial year end (to which the government makes up its own accounts) and by reference to which corporation tax rates apply. The review will also examine whether to move the end of the tax year to 31 December, the date many countries use for their end-of-year accounts. It will publish its conclusions in the summer of 2021. OTS to explore potential for moving the end of the tax year - GOV.UK 

Probate timescales

HM Courts & Tribunals Service has given an update on timescales for obtaining a grant of probate in light of the long delays that practitioners have been experiencing during the Covid-19 pandemic. Recent data indicates that online applications take between four and eleven weeks; paper applications between three and sixteen weeks. HMCTS responds to issues with the probate service - Law Society

Trust Register and life insurance policies

HMRC have confirmed that trusts holding life insurance policies that pay out on death and have a surrender value are "excluded trusts" for the purposes of the updated Trust Register legislation that requires all express trusts (taxable and non-taxable) to register. There had previously been uncertainty as to whether such trusts would be excluded if the policy had a surrender value. Once the policy pays out on death, the trust will remain "excluded" for two years from the date of death. Trusts Registration Service: HMRC clarifies position on trusts holding life policies with surrender value | Practical Law (thomsonreuters.com)

Removal of executors

Hudman v Morris (2021) EWHC 1400 Ch is an example of how a family feud can prevent any family member effectively acting as executor. The case involved brother and sister executors who both tried to have each other removed as executors of their father's estate. The Hight Court noted the "dysfunctionality" of the family and agreed that the brother executor had shown intense and ill-founded hostility towards his sister and other siblings (who were beneficiaries of the estate). The Court concluded that the proper and effective administration of the estate was threatened by the brother being an executor and, as the wholesale breakdown of relations between the brother and his siblings had made the task of executors impossible, the sister should also be removed in favour of the appointment of an independent administrator. Hudman v Morris [2021] EWHC 1400 (Ch) (01 June 2021) (bailii.org)