Commentary

I4.550 Discretionary interest in residue

IHT, trusts and estates

I4.550 Discretionary interest in residue

I4.550 Discretionary interest in residue

The basic amount of estate income relating to a beneficiary's discretionary interest in the residue of an estate for a tax year or accounting period is the amount of payments made to the beneficiary in that year or period in exercise of the discretion1. The beneficiary is assessable on the basic amount grossed up at the applicable rates for the relevant tax year2.

Discretionary payments made by trustees under a trust created by the Will are grossed up at the trust rate (see I5.1012).

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