Interest in possession beneficiaries

Produced by a Tolley Trusts and Inheritance Tax expert

Trusts and Inheritance Tax

Guidance

This note deals with the main principles of income tax that apply to beneficiaries of an interest in possession trust.

An individual will be charged to income tax only where he is entitled to, or receives, income from a taxable source. For a beneficiary of an interest in possession trust, you need to ask: what is the source of the trust income to which he is entitled?

The source of a beneficiary’s income

The source of the income of a beneficiary of an interest in possession trust (constituted under the law of England and Wales) is the trust property itself, and not the right that is enforceable against the trustees to have the trust properly administered.

A beneficiary is specifically entitled to the trust income that has not been used to defray the trustees’ management expenses. In other words he is entitled to the net income arising from the trust property.

In Scots law, the beneficiary of any trust has only a personal right against the trustees to have the trust properly

Continue reading the full document

To gain access to additional expert tax guidance, workflow tools, generative tax AI, and tax research, register for a free trial of Tolley+™

TAKE A FREE TRIAL NOW

Popular Articles

Personal Tax

Inter-spouse transfer

Inter-spouse transferIntroductionWhen a chargeable asset is transferred between two spouses or civil partners, there is a disposal by the transferor spouse / civil partner and an acquisition by the transferee spouse / civil partner for capital gains tax purposes. For simplicity, spouses and civil

14 Jul 2020 12:01 | Produced by Tolley Read more

Value Added Tax

Exemption ― burial and cremation

Exemption ― burial and cremationThis guidance note provides an overview of the VAT treatment of services that are provided in connection with the burial or cremation of human remains.VAT treatmentThe following services are exempt from VAT:•the disposal of the remains of the dead•making arrangements

14 Jul 2020 11:38 | Produced by Tolley Read more

Personal Tax

Self assessment ― amendments and corrections

Self assessment ― amendments and correctionsOnce a self assessment tax return has been filed, both HMRC and the taxpayer (or the agent) has the right to make changes to the return. There are different time limits depending on whether it is a correction by HMRC or an amendment made by the

14 Jul 2020 13:37 | Produced by Tolley Read more

��˾��ҹ��