½Û×ÓÊÓÆµ

Tax on income distributions for beneficiaries of non-resident trusts (6 April 2025 onwards)

Produced by a Tolley Trusts and Inheritance Tax expert
Trusts and Inheritance Tax
Guidance

Tax on income distributions for beneficiaries of non-resident trusts (6 April 2025 onwards)

Produced by a Tolley Trusts and Inheritance Tax expert
Trusts and Inheritance Tax
Guidance
imgtext

This guidance note explains the treatment of income from a non-resident trust which is not settlor interested. This note applies to income entitlements from 6 April 2025. The treatment of Income for previous years is explained in the Tax on income distributions from non-resident trusts guidance note.

Introduction

The tax liabilities of UK resident beneficiaries of non-resident trusts are governed by a series of ‘tax hierarchy’ rules. See the Tax on UK resident beneficiaries of non-resident trusts (overview) guidance note.

The first step is to establish whether:

  1. •

    the beneficiaries’ entitlement under the trust is fixed or discretionary, and

  2. •

    any payment is capital or income

The nature of the beneficiaries’ interest will help to determine what type of payment it is. This is discussed further in the Tax on UK resident beneficiaries of non-resident trusts (overview) guidance note.

Payments of and entitlement to income are subject to income tax according to the principles set out in this guidance note.

Fixed interest

Continue reading the full document
To gain access to additional expert tax guidance, workflow tools, and tax research, register for a free trial of Tolley+â„¢
Powered by

Popular Articles

Outright gifts

Outright giftsAn outright gift is the most straightforward type of gift. It simply involves the outright transfer of property from one person to another with no conditions attached.This type of gift is most suitable for clients who want to pass over modest amounts, or give to responsible and capable

14 Jul 2020 12:22 | Produced by Tolley in association with Emma Haley at Boodle Hatfield LLP Read more Read more

Short-term business visitors (STBVs)

Short-term business visitors (STBVs)What is a short-term business visitor?An STBV for UK tax purposes is an individual who performs duties for a non-UK employer and as a part of those duties has been asked to spend a short period working in the UK. There is a common misconception that there is

14 Jul 2020 13:40 | Produced by Tolley in association with Gill Salmons Read more Read more

Enterprise management incentive schemes

Enterprise management incentive schemesWhat is an enterprise management incentive (EMI) scheme?The enterprise management incentive (EMI) scheme is a tax-advantaged share option employee incentive scheme aimed at small entrepreneurial companies that meet certain conditions. It is designed to assist

14 Jul 2020 11:36 | Produced by Tolley Read more Read more