The Inland Revenue Department (IRD) has officially announced an upcoming increase in the trust tax rate to 39% starting from the 2025 financial year. This change has been implemented as part of the government’s broader strategy to promote tax fairness and ensure a sustainable revenue stream for the country.

Key Considerations for Our Clients:

1. Impact on Trust Income: The rise in the trust tax rate directly affects the taxable income generated by trusts, leading to higher tax liabilities for beneficiaries. It is crucial for our clients with existing trusts or those considering establishing one to be aware of these potential implications.

2. Reviewing Trust Structures: Given the impending tax rate change, it is advisable for clients to review their existing trust structures. Our knowledgeable team of tax professionals can assist in evaluating the effectiveness and suitability of current setups. We can identify areas that may require adjustment and ensure that your trust remains aligned with your overall financial goals.

3. Strategic Tax Planning: While the increased tax rate presents challenges, it also creates opportunities for strategic tax planning. By proactively exploring various tax planning strategies, our clients can optimize their tax positions within the evolving landscape. Our team is well-equipped to provide personalized advice tailored to your specific circumstances.

4. Staying Informed: We understand that tax matters can be complex, and staying up-to-date with changes can be challenging. At Lowthers Tax Consultants, we are dedicated to keeping our clients informed about the latest tax developments, including updates related to the trust tax rate increase. By equipping our clients with relevant information, we aim to empower them to make sound financial decisions.

Conclusion: The increase in the trust tax rate to 39% has significant implications for our clients with trusts or those considering establishing one. At Lowthers Tax Consultants, we are here to offer guidance and support throughout this process. Our focus is on providing value-added information and assisting our clients in making well-informed decisions.

We encourage our clients to engage with us to discuss their trust structures, explore tax planning opportunities, and stay updated on any further changes related to the trust tax rate. By working together, we can ensure that your tax strategies are optimized and aligned with your long-term financial objectives.