I've been asked to complete a Trust Return and a personal Tax Return for someone who has received money out of the Trust. The Trust was removed from SA a few years ago on the grounds of lack of activity. Until now no payments have ever been made out of it and its only income has been a few dividends and bank interest. It has total assets of about £80K. I try to steer clear of Trusts but hate turning work away!
The client told me the Trust paid him £5000 net. He is one of the Trustees along with his sister. I did his personal Tax Return and, assuming I put it in the correct place, the software grossed it up to £9090.91- a rate of 45% which i think is correct. He's queried it on the basis that his mother wouldn't have meant such a rate to be deducted as, I assume, when I complete the Trust Return, that will have to pay the tax over.
I've purchased a one user licence from Andica for the Trust Return but, at the moment, that's as clear as mud!
Am I on the right lines all you trust experts out there?