VULNERABLE BENEFICIARIES
09/04/2009
As part of the modernisation of the system of trust taxation a form of relief for both income tax and CGT was introduced in ss.23–45 of, and Sched.1 to, the Finance Act 2005 for discretionary trusts or trusts which can accumulate income which have a “vulnerable beneficiary”.
The purpose behind these rules is to enable a discretionary trust which would otherwise be taxed at 40% (and for dividends 32.5%) to be taxed according to the financial circumstances of the vulnerable person.
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