TSEM1870 - Introduction to trusts: errors made by trustees (the Hastings-Bass principle)

Where trustees act in error, with the result that they incur more tax than anticipated, the parties involved may then seek to overturn their actions through the Court by invoking the principle in Hastings-Bass. In such cases, the parties may ask whether the HM Revenue & Customs wants to be joined as a party to the proceedings.

In some cases the parties may approach us seeking our agreement to ignore the error for tax purposes without going to Court. In the absence of a court order, we would not agree to such a request.

Refer all cases involving errors made by trustees/the Hastings-Bass principle to HMRC Trusts & Estates Technical Bootle for advice.