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Readers' forum : Trust legacy

29 March 2016
Issue: 4543 / Categories: Forum & Feedback

Provision of a small income under a trust legacy if an annuity is not purchased.

This is probably a simple question to answer but I always struggle with the taxation of trusts.

A client has died and in his will has made specific legacies. The will then goes on to say that the residuary estate is to be held in trust to provide monthly income of £200 to an unconnected person for their lifetime. Any shortfall is to be made up from capital.

On the other person’s death the remaining amount should be paid to various charities. The will also provides for the executors to purchase an annuity that will give £200 to the unconnected party for life.

Assuming an annuity is not purchased I presume a trust tax return will need to be prepared each year? Taxation readers’ suggestions on the tax consequences and implications would be appreciated.

I look forward to replies.

Query 18 749– Firth.


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