LATEST NEWS

UK Fairness Test Mitigates Italian Pre-Nuptial Agreement

12th February, 2019 By Alireza Nurbakhsh

The law relating to the division of family assets on divorce varies widely across the world and the UK is generally regarded as one of the fairer jurisdictions for such financial arrangements in that the assets tend to be divided more equally than in many other countries. Accordingly, where a family with an international lifestyle breaks up and there is a reasonably strong connection to the UK, it is often chosen as the jurisdiction of preference for divorce proceedings by a spouse who might be disadvantaged if the proceedings are...

What is the Tax Status of Compensation for Financial Product Mis-Selling?

7th February, 2019 By Alireza Nurbakhsh

Is compensation paid to individuals whose businesses have failed due to mis-selling of financial products subject to Income Tax? In a decision that will disappoint many victims of bank wrongdoing, the First-tier Tribunal (FTT) has answered that question in the affirmative. The case concerned seven brothers whose property letting business had been mis-sold interest rate hedging products (IRHPs). The business subsequently failed, allegedly due to the high interest rates imposed by the IRHPs. After they lodged complaints, the relevant bank paid them basic compensation totalling almost £360,000. HM Revenue and...

Transfer of Pension Fund Does Not Escape IHT Charge

4th February, 2019 By Alireza Nurbakhsh

Inheritance Tax (IHT) is not only payable on the value of the estate of a deceased person, but can also be levied on 'transfers of value' from the deceased's estate in the seven (exceptionally 14) years prior to their death. But what counts as a transfer of value? A recent court case led to a conclusion that many might see as unfair and rather counter-intuitive. It involved a woman who had been divorced from her husband since 2000. As part of the financial settlement on divorce, a 'pension split' was agreed...

Hedge Cutting Proves Costly

1st February, 2019 By Alireza Nurbakhsh

You might think that where the boundaries of property lie should be clear, but boundary disputes are a fruitful source of argument in the courts. A recent case arose when, between contracts being exchanged on a property and the completion of its purchase, a row of hedging plants and trees that lay between the property and the neighbouring house had been cut back by the neighbours to the level of the earth bank on which they grew. The buyer claimed the plants were on her property, whilst the neighbours disputed...