486 How allowable expenses are to be set against trust rate income
Income Tax Act 2007 (2007 c 3) | Legislation

486  How allowable expenses are to be set against trust rate income

(1)     Take the following steps to determine how the allowable expenses are to be set against the trustees' trust rate income for the current tax year.

Step 1

Reduce the allowable expenses by the proportion of those expenses (if any) which is excluded in accordance with section 487.

References at Steps 3 to 6 below to the allowable expenses are references to the expenses as so reduced.

Step 2

Identify the type or types of income which make up the trust rate income. The possible types are dividend income, savings income and other income.

Step 3

If there is dividend income within subsection (2)—

(a)     gross up by reference to the dividend ordinary rate so much of the allowable expenses as is necessary to give

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