View more on these topics

Budget supplement

Further matters of interest in the Budget are:-

Domicile And Residence

(i) A report is to be released before the pre-Budget report 2002, generally published in November, on the complex rules of residence and domicile. It is not yet clear whether this announcement signals that there will be a formal consultation document, a discussion paper or even firm proposals. What does seem clear is that the Government have accepted that the residence and domicile rules are too complex and many need to be reviewed.


There is plenty of scope for action attacking some fundamentally important strategies such as the remittance basis for capital gains tax and income tax and rules such as the non situs and the excluded property trust rules for inheritance tax.

One could not rule out a revised residence and long-term residence rule with a statutory definition of domicile for particular tax purposes. Some feel that greater certainty on these key issues would be more in tune with the understandable certainty required by individuals under the self assessment regime.

Offshore Funds

(ii) A consultation exercise on offshore funds has been promised. It is relatively well known that the offshore funds legislation – not least that dealing with the categorisation of such funds as distributor or non-distributor – is extremely complex.


There can be few members of the investing public who fully appreciate the differences between roll-up and distributor funds. The tax treatment is significantly different and it may be that this is what the consultation is aiming to review. There is, of course, a significant tax difference between the taxation of gains from roll up funds (income tax, no indexation, no CGT annual exemption or taper relief) and capital gains under distributor funds (capital gains tax after taper relief and the annual exemption).

There can also be an administration cost attached to obtaining and maintaining distributor status.

Advisers comparing the appropriateness of the various investment wrappers will need to take account, under current rules, of all the choices including UK and offshore bonds, portfolio management and UK and offshore funds – in the latter case, distributor and non-distributor funds.


Gaskin fears over procuration fees

Burns Anderson network chief Jim Gaskin has raised fears over the future of procuration fees for mortgage brokers as a result of CP121.Many brokers make the vast majority of their income from mortgages through fees paid by lenders but Gaskin says this could soon change.Speaking at the G80 summit, Gaskin cautioned advisers that if they […]

A consumer&#39s view – Lorna Bourke

There is an old saying that the conduct of the chief executive sets the tone of how business is done throughout an entire company. This is true of the Government, too.Nowhere is this more evident than in the totally expedient and unprincipled way in which depolarisation is being pushed through by Blair&#39s yes men as […]

MCCB protection warning if broker fee limit is axed

The Mortgage Code Compliance Board believes consumer protection will be red-uced if the £5 broker&#39s fee maximum limit for advice not resulting in a mortgage sale is removed.In its consultation paper, the Treasury justifies removing the limit because the best advice for a potential borrower might be to not take out a mortgage.But the MCCB […]

Rathbones runs with ethical bond fund

Rathbone Unit Trust Management has capitalised on interest in corporate bonds and ethical products with the introduction of the Rathbone ethical bond fund.This unit trust invests in corporate bonds issued by companies that have a positive attitude towards ethical concerns. It has a target yield of 6.2 per cent and will concentrate only on sterling-denominated […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers. Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm