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HMRC internal manual

Trusts, Settlements and Estates Manual

Legal background to trusts & estates: apportioning income

Apportionment Act 1870

The deceased’s investments will continue producing income. The administrators have to decide whether they have received

  • income which belonged to the deceased, or
  • income of the period after the death.

The Apportionment Act 1870 provides rules for deciding this. For inheritance tax purposes, periodic payments, in the nature of income, are regarded as accruing from day to day. For income tax purposes, the normal rules apply for determining when income arises (this is when it becomes due and payable).