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HMRC internal manual

Trusts, Settlements and Estates Manual

Non-resident trusts: residence rules: trust residence for Income Tax purposes - periods to 5 April 2007

FA89/S110

A trust may have one or more trustee/s, who may be individuals or companies. The rules were:

All trustees were resident in the United Kingdom

The trust was resident in the UK for Income Tax purposes.

All trustees were resident outside the UK

The trust was non-resident in the UK for Income Tax purposes.

Trustees who were all resident in the UK changed to trustees who were all not resident

The trust was resident in the UK for Income Tax purposes for the part of the year that resident trustees were in office. The trust was non-resident for Income Tax purposes for the rest of the year.

Trustees who were all non-resident in the UK changed to trustees who were all resident

The trust was non-resident in the UK for Income Tax purposes for the part of the year that non-resident trustees were in office. The trust was resident for Income Tax purposes for the rest of the year.

There was a mixture of resident and non-resident trustees acting at the same time

The trust was resident in the UK unless the settlor was:

  • not resident in the UK and
  • not ordinarily resident in the UK and
  • not domiciled in the UK

when the settlement was set up and when any later funds were added. If the settlor conditions were met the trust was not resident in the UK for Income Tax purposes