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HMRC internal manual

Trusts, Settlements and Estates Manual

Trust income: resident trustees with trust income from abroad - beneficiary is resident but not ordinarily resident

These instructions apply only if the beneficiary:

  • has an absolute interest in trust income (TSEM6204). This includes a life tenant and an annuitant;
  • is a citizen of the Commonwealth or the Republic of Ireland.

The trustees’ income tax liability is based on the beneficiary’s not ordinarily resident status.

The beneficiary must make a claim for any year that the remittance basis is to apply.

If in any year the beneficiary claims the remittance basis the trustees’ liability on the share of other income from abroad payable to the beneficiary is limited to the amount remitted to the United Kingdom. Trustees exclude from the Trust and Estate Tax Return any such overseas income that is not remitted to the UK.

If in any year the beneficiary does not claim the remittance basis the trustees are assessable on the amount arising.

Tax case

Williams v Singer & others 7 TC 387