The following Trusts and Inheritance Tax guidance note by Tolley provides comprehensive and up to date tax information covering:
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:
There is a degree of overlap between the different provisions and the order in which they are listed above represents the order of priority to be applied. This guidance note outlines the application of each type of charge and provides links to more detailed material as appropriate.
In general terms, the settlements code is a set of anti-avoidance measures which attribute income arising under a settlement to the settlor if he (or his spouse or minor children) is able to benefit from it. With a UK resident trust and settlor, the code has the effect of taxing the trust income at the settlor’s rates. Currently, the difference between
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