Legal Concepts and Regulation Flashcards
Legal Persons (diff structures)
- Sole Trader
- Partnership
- Limited Liability Partnerships
- Limited Company Ltd
- Public Limited Company
- person working on self employed way and trading as a given trade name NI class 2 & 4, profits taxed back
- 2 people, each person assessed tax NIC but jointly liable
- assume legal identity and various rules to be met
- profits subject to corporation tax and directors are employees, pay themselves in form of salary or through dividends or combination, responsible for debts
- larger form usually floated on stock exchange, more rules to apply, allotted share capital, req of personnel with company secretary prof body, accounts put out,
Powers of attorney (POA)
- person giving power known as donor
- person give power to is attorney, can have more than one and can spec to act jointly or in isolation
Ordinary POA
simplest, financial matters only whilst donor mentally capable, once not comes to an end
Enduring POA
Address of issue around mental capacity, court needs to give consent proir to incapacity
- structured in 2 ways - immediate action, delayed action
- still only in relation to financial matters
Lasting POA
need to be registered with office of public guardian before used and has legal effect
deals with matters outside financial affairs
two forms
- financial decisions (like an EPA)
- health and care decisions includes the withdrawal of treatment, only when incapable
Non disclosure
The consumer insurance act 2012 forms
- duty of disclosure on part of insured lasts from point of application until the contract goes live
- reasonable - customer made mistake
- carless - customer didn’t answer carefully
- deliberate or reckless - contract void from inception
Property & Ownership
- 2 ways owned
- joint tenants
- tenants in common - each person owns a % and upon death pass through will, have benefits for financial planning but could have risks relationship wise
Ownership basis - relation to ownership of land and building
- Freehold ownership of land and building
- leasehold ownership of building not lans (ground rent, leases short or long term)
- commonhold property owned outright by each person but landed owned jointly between there under sep legal agreement
Will and Intestacy to be valid
must be in writing
signed
witnessed by 2 people
Intestacy
Where there is no will - pass to other property owner, then spouse, then children (must be 18) (spouse inherit chattels 250K and half any amount above 250K children other), other relatives,
no family the crown takes all
Trusts
ensure right money ends up in right hands, each trust has 3 key parts
- the settlor (person who puts the assets in trust)
- the trustee/s (person who look after the assets and have ownership)
- the beneficiary - person who will benefit from he trust
Main use of trusts
- IHT -gifting money / pensions . life policies
- avoiding probate (assets passed down)
- looking after assets for minors
Main forms of trust
- absolute / bare trust (property benefit one or more people in %)
- interest in possession trust (life tenant receive income)
- power of appointment trust (trustees have flex to vary beneficiaries)
- discretionary trust (power of appointment trust)
Ways trust come into being
- express (use of trust deed)
- implied (implied by action)
- resulting (arises because if something else)
- successive (successive interests)
- will trust (common prior to introduction of transferable nil rate band for IHT)
- statutory trust (benefit of minor children
Legislation covers responsibility of trustees
- the trustee act 1925 (rights and responsibilities)
- trustee investment act 2000 (sets out req for trustees to take advice of investment
