Indemnities for tax protection

ognum

Following the death of my mother as executor I have over seen the closure of two trust one belonging to my father who died many years ago and one for the recent death of my mother.

I now have written conformation that the tax office have closed the trusts and do not require any further information regarding them.

My solicitor is suggesting I take out indemnity policy's to protect myself and my sister as executors the cost is £400+VAT for each.

The estate will pay for these if needed but are they needed? If so is this a reasonable cost, if not can any one recommend another source.

Murdina

I think this policies may extend to more than tax. As the trusts are gone then if there were any issues re the trust you as trustee carrying personal liability would have to find the money out of your own pocket.

If you have done tax returns (both income tax and any IHT) and there is no other actions the trust has taken which might remotely lead to some future claim then you could perhaps dispense with them but it would give you protection otherwise. Really depends on what sort of money was in the trust.

If you have had professional advice throughout you might take the view if anything rebounded you could sue them - but that can be a lengthy and costly route.