Commentary

I4.422 Variations and disclaimers — income tax issues

IHT, trusts and estates

I4.422 Variations and disclaimers — income tax issues

I4.422 Variations and disclaimers — income tax issues

There is no provision corresponding to IHTA 1984, s 142 for the purposes of income tax. However, this does not mean that a disclaimer or deed of variation within s 142 has no income tax consequences.

Firstly, a disclaimer of an interest in an estate has effect for most purposes as if the person disclaiming never owned the interest, and is effective to transfer any previously-accrued income of the property or right disclaimed and the liability to income tax on that income.

This is a matter of general principle rather than anything specific in income tax or case law. It can only relate to income which has not been distributed to the person making the disclaimer since it is not possible to make a disclaimer of an interest once benefit under it has been accepted (see I4.416).

Secondly, where an

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