Bonds held by offshore trusts or companies

The small print in the UK pre-Budget Report contained a change to the way that gains on bonds held by offshore trustees and companies are taxed. Until 17 March 1998, there were two major loopholes in the UK chargeable events legislation that allowed insurance bond chargeable events to be paid free of UK income tax. The first was where a bond was held in trust and the settlor was dead or non-UK resident, as the legislation did not contain any provisions to assess an alternative taxpayer in that scenario. The second was where the bond was owned by a non-UK resident company. In this ins...