½Û×ÓÊÓƵ

Where a UK resident settlor has created a non-UK resident trust, he may become personally liable to income tax or capital gains tax in relation to the trust’s income or gains, even if he does not receive a payment from the trust. The following legislative provisions levy a potential charge on UK settlors of non-resident trusts:

1. •

   the settlements code set out in ITTOIA 2005, ss 619–648 imposes an income tax charge on settlors with respect to income arising within a ‘settlor-interested’ trust. The provisions apply equally to UK resident and non-resident trusts

2. •

   the transfer of assets abroad code (TAAC) set out in ITA 2007, ss 714–747 imposes an income tax charge on settlors who may benefit from a non-resident trust as a result of a ‘relevant transfer’

3. •

   TCGA 1992, s 86 attributes capital gains arising within a non-UK resident trust to settlors who have an interest in the settlement

4. •

   TCGA 1992, s 87 imposes a capital gains tax charge on the settlor in relation to certain