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HMRC internal manual

International Manual

UK residents with foreign income or gains: trusts: Garland trusts

In the case of income of a non-discretionary foreign trust of the type considered in the case of Garland v Archer Shee 15 TC693, the beneficiaries are not concerned with the source of the trust income and whether or not it has borne United Kingdom tax. It is the practice to allow relief to beneficiaries, other than annuitants, in respect of the proportion of the income assessable as foreign income which is regarded as being derived from trust income which has borne United Kingdom tax. It is a condition of the relief that the amount of the income for higher rate purposes is to be treated as the sum of the amount assessable and the amount of tax on a grossed up basis which is applicable to the part of the assessment on which relief has been given.

Submit the first claim from a beneficiary for this relief to the Offshore Personal Tax Team (part of Charity, Assets & Residence), before admitting the claim.