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Standard Life Wrap Investment

Standard Life Wrap Investment

My client has been sold a Standard Life Wrap Investment Trust, to save towards his children's school fees.  The aim is for capital growth, but there is a bit of investment income this year.

The financial advisor does not really seem to know the tax ins and outs of this, but I just wanted to clarify my understanding please.  He has told me it is a bare trust.

As father has pumped in all of the cash, any investment income arising will need to go on his own tax returns each year as it is a settlor interested trust.  As it is a bare trust presumably we don't need to register the trust for SA.

Capital gains, however, will be taxable on the children as the beneficiaries as there is no equivalent settlor interested charge for children.

Or does someone else know something about these schemes that I don't?

Presumably the advantage will be in the children taking the cgt hit?  Otherwise I wonder why they have bothered??


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