Mandated trust income - where to declare on TR

Mandated trust income - where to declare on TR

Didn't find your answer?

I have filed TR wrong!

Investment income, some sort of portfolio. Not bank interest but 20% deducted. The income has been mandated, the net income has always gone straight into the life tenant's personal bank.

Income from life trust has been declared on trust TR. No tax as 20% taxed at source. Never a problem in the past but 16/17 the life tenant would have got the tax back (interest 2.7K gross).

I'm proposing to include this on box 1 of page TR3. I can't for the life of me think why it's trust income (pages).

I'm right aren't I - please. It's page TR3

Many thanks

 

Replies (5)

Please login or register to join the discussion.

avatar
By chicken farmer
22nd Mar 2018 11:40

No. See item 6 on page TR2 and then complete an SA107

Thanks (0)
Replying to chicken farmer:
avatar
By HeavyMetalMike
22nd Mar 2018 13:26

Hmm. But it's not income from a trust.
It's income that she would have been entitled to that hasn't actually been received by the trust and then paid out.

Thanks (0)
Replying to HeavyMetalMike:
avatar
By chicken farmer
22nd Mar 2018 14:12

But you said the client was a life tenant, so why isn't it income from a trust?

Have you read page TR2?

Thanks (0)
By slipknot08
22nd Mar 2018 15:43

Where income is mandated to an income beneficiary, the income belongs to the beneficiary as of right - it is never received by the trustee, but is received direct by the beneficiary and it does not lose its source/character.

Mandated income should therefore be entered on the personal tax return, in the appropriate section for the source, and not on the trust pages, in order to ensure that the correct tax calculation is made.

The ICAEW released Taxguide 13/17 (https://www.icaew.com/en/technical/tax/tax-faculty/taxguides/taxguide-13...) which deals with mandated income and HMRC's views on various scenarios.

Thanks (0)
Replying to slipknot08:
avatar
By HeavyMetalMike
22nd Mar 2018 17:03

An excellent answer and the one I wanted.
Thanks.

Thanks (0)