Trusts for particular purposes: compensation under ESC A68 - example using savings income - years to 2009-2010
The trustees must meet the conditions of the concession (TSEM5610).
This is how to calculate relief on savings income.
|Tax pool brought forward||Nil|
|Tax on standard rate band (20%)||£1,000||£200|
|Tax due at trust rate (40%)||£99,000||£39,600|
|Income available for distribution||£60,200|
|Total Tax pool||£39,800|
|Amount distributed subject to PAYE||£60,200|
The compensation payable to trustees is the lesser of
|* tax at trust rate on the total payments which are treated as employment income||£60,200 @ 40% =||£24,080|
|* tax which the trustees have available in the ‘tax pool’ above||£39,800|
|The compensation payable is therefore||£24,080|