UUΒγΑΔΦ±²₯

Calculation of vulnerable beneficiary relief


Produced by a Tolley Trusts and Inheritance Tax expert
Trusts and Inheritance Tax
Guidance
tag-icon Autumn Budget 2024

Calculation of vulnerable beneficiary relief


Produced by a Tolley Trusts and Inheritance Tax expert
Trusts and Inheritance Tax
Guidance
tag-icon Autumn Budget 2024
imgtext

This guidance note explains how income tax and capital gains tax relief for vulnerable beneficiary trusts is calculated and explains the effects of a claim in different circumstances. The qualifying conditions for the relief and procedure for making a claim for special tax treatment is described in the Vulnerable beneficiary trusts guidance note. The β€˜special tax treatment’ is one claim for income tax and capital gains tax. You cannot choose to claim one without the other. However, the reliefs are calculated and declared on the tax return separately.

Calculation of income tax relief

The income tax concession for vulnerable beneficiary trusts is a tax reduction in the trustees’ income tax liability applied at Step 6 of the calculation of liability under ITA 2007, s 23. It is applied after any other reduction to which the trustees are entitled.

The aim of the relief is to bring the trustees’ tax liability down to what the vulnerable beneficiary’s tax liability would be on the trust income if it had arisen to him directly.

Essentially,

Continue reading the full document
To gain access to additional expert tax guidance, workflow tools, generative tax AI, and tax research, register for a free trial of Tolley+β„’
TAKE A FREE TRIAL NOW
Powered by
  • 01 Nov 2024 07:11

Home/ Tolley Tax Guidance/ Trusts and Inheritance Tax / Advising on trusts β€” IHT

Popular Articles

Value Added Tax

UK VAT invoice requirements

UK VAT invoice requirementsThis guidance note provides details of the information that must be shown on a valid tax invoice. Businesses supplying goods and services that are liable to the standard or reduced rate of VAT are required to issue a tax invoice to another VAT registered person.If the

14 Jul 2020 13:46 | Produced by Tolley Read more Read more
Corporation Tax

Entity classification

Entity classificationImplications of entity classificationIf a subsidiary is established, it is important to determine how it will be treated for UK tax purposes as this will determine the basis on which it is taxed. A subsidiary may either be transparent (like a partnership, where the individual

14 Jul 2020 11:37 | Produced by Tolley Read more Read more
Value Added Tax

VAT registration ― change of VAT registration details

VAT registration ― change of VAT registration detailsVAT registered persons must keep their VAT registration details up to date and notify HMRC of any changes. Failure to notify HMRC by the relevant time could result in a penalty. For guidance regarding penalties for failure to notify please see the

14 Jul 2020 13:57 | Produced by Tolley Read more Read more