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HMRC internal manual

Trusts, Settlements and Estates Manual

Deceased persons: absolute interests in residue - tax rules

While the personal representatives administer the estate the income that they will usually receive is the income of the personal representatives. They are liable to tax either at the basic rate, savings rate (for years where this rate applies) or the dividend rate depending on the type of income. It is not the income of the beneficiaries.

Special tax rules in ITTOIA/S659 and 652 apply to non-corporate beneficiaries and in CTA 2009/S937 to corporate beneficiaries. Under these rules beneficiaries who have absolute interests in residue are deemed to have received income from the estate. Different tax rules apply for

Within each of these categories there are different rules for payments made during and on completion of the administration period. You need to know therefore whether the administration has been completed.