HMRC has launched a consultation seeking views on legislative proposals to extend an existing concession that removes trusts and estates from income tax where the only source of income is savings interest and the tax liability is below £100. Trustees and personal representatives with experience of low-income trusts and estates are invited to respond. The consultation closes on 18 July 2022.
Under the proposals, low-income trusts and estates with income from any source up to a de minimis amount (to be decided following the consultation) will not be subject to income tax on that income. For those with more than the de minimis amount, income tax will be due on the full amount of income rather than only applying to the income above the de minimis amount.
The consultation includes further proposals relating to discretionary trust tax pool adjustments. Under these proposals, even where discretionary trusts would be covered by the de minimis rule, trustees will still have to pay tax when they pay income out to a beneficiary, to ensure that the tax credit remains funded.
HMRC has launched a consultation seeking views on legislative proposals to extend an existing concession that removes trusts and estates from income tax where the only source of income is savings interest and the tax liability is below £100. Trustees and personal representatives with experience of low-income trusts and estates are invited to respond. The consultation closes on 18 July 2022.
Under the proposals, low-income trusts and estates with income from any source up to a de minimis amount (to be decided following the consultation) will not be subject to income tax on that income. For those with more than the de minimis amount, income tax will be due on the full amount of income rather than only applying to the income above the de minimis amount.
The consultation includes further proposals relating to discretionary trust tax pool adjustments. Under these proposals, even where discretionary trusts would be covered by the de minimis rule, trustees will still have to pay tax when they pay income out to a beneficiary, to ensure that the tax credit remains funded.
