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Can a Discretionary and Irrevocable trust be shut down?

Can a Discretionary and Irrevocable trust be shut down?

Postby giompizz » Mon Oct 09, 2017 3:57 pm

So according to this discretionary and irrevocable trust i'm helping with, the deed states that the trust will terminate upon the occurrence of one of the following conditions:
(a) The completion of the period of 80 years since incorporation;
(b) The death of the beneficiaries; or
(c) The joint agreement between the trustee and beneficiaries in the event of loss of all assets in the trust.
Here the settlor is looking to have the trust shut down and have the property transferred back to him. It was established in 2014 and all 5 assets contained are located in a foreign country. I understand what irrevocable means, but was wondering if there are any avenues to pursue for the settlor to get his property back?

Any help would be greatly appreciated!
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Re: Can a Discretionary and Irrevocable trust be shut down?

Postby atticus » Mon Oct 09, 2017 4:46 pm

this bloke should show all the documents to a suitably qualified professional.
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Re: Can a Discretionary and Irrevocable trust be shut down?

Postby dls » Tue Oct 10, 2017 12:55 pm

Once someone signs up for this kind of over complex tax planning, it can making a pact with the devil.

There are a series of cases where people have sought to have trusts set aside on the basis of mistaken/poor advice. The wriggle room is not substantial.

The Variation of Trusts Act 1958 is worth exploring but from memory isan approach from the point of view of the potential beneficiaries.

A quick search on swarb.co.uk on "Variation of Trusts Act 1958 " will reveal much case law.
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Re: Can a Discretionary and Irrevocable trust be shut down?

Postby giompizz » Wed Oct 11, 2017 11:29 am

Could the rule in Saunders v Vautier be applicable here? In that the Beneficiary is an adult and sui juris and could come to the agreement with the Settlor to terminate the tust? Essentially if the Settlor and Beneficiary both agree to terminate a trust, is that possible in UK law?
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Re: Can a Discretionary and Irrevocable trust be shut down?

Postby theycantdothat » Wed Oct 11, 2017 4:20 pm

giompizz wrote:Could the rule in Saunders v Vautier be applicable here? In that the Beneficiary is an adult and sui juris and could come to the agreement with the Settlor to terminate the tust? Essentially if the Settlor and Beneficiary both agree to terminate a trust, is that possible in UK law?


If there is only one beneficiary how can it be a discretionary trust?

If it is a discretionary trust then the rule in Saunders v Vautier can only be applied if all the possible beneficiaries are known at the proposed date of termination.

It the trust can be terminated advice is needed as to what the tax consequences will be.
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