Hi.Can you tell me a little about the trust please. Are you completing a return for the administration period of your late father's estate or for a trust created by his will? If the former, which I suspect is the case, when did you father pass away? Have the estate assets been distributed? If the latter, who are the beneficiaries of the trust? What does the trust document say about distributing income? Was the only income from dividends? If so, were these UK dividends?
I am completing a return for a trust created by ny late father's wiil, not for the administration period, which ended on 4 April this year (2014). My father died on 1 February 2012, and I completed the Probate process myself, which was granted on 10 January 2013.
As I understand it, the estate assets have not been distributed, because the only beneficiaries of the trust named in the will are myself, my mother and my brother, each defined in the will as discretionary beneficiaries.
Re distributing income, the the trust document says,
i) 'I GIVE BEQUEATH AND DEVISE all the residue of real and personal property wheresoever and whatsoever ("my Residuary Estate") to my Trustees UPON TRUST to sell call in and convert the same into money...'
ii) ...'the Trustees shall holdthe Trust Fund and the income thereof absolutely for the Benficiaries specified in para (iv) etc.. of Sub-clause (a) or to the survivor of them
iii) under a section headed Capital and Income:...''the Trustees may treat all dividends and other payments in the nature of income received by them at the date of receipt irrespective of the perod for which the dividends or other income is payable.'
The dividends were, to the best of my knowledge, the only income, resulting from a porfolio investment of shares in both British and foreign companies, but managed on our behalf by an investment management company, JM Finn, London.
Thank you for your excellent reply.
Just one or two other questions in relation to the Trust and Estate Tax Return:
For Q5 on page 3, SA900 (the name of the HMRC type of form);
Did the trust or estate dispose of chargeable assets worth more than £43,600 in total?...'
What does this mean exactly? Is it selling or giving away assets? The only assets we sold were in the form of shareholdings that were transferred into Nominees by JM Finn, the company mentioned previously, who sold them on our behalf and purchased a number of collective investments (funds) in which we invested the money. When eventually completed, the total amount was about £67,000, but was just under £43, 600 - HMRC's figure in Q5 - as at 1 February 2012.
The dividend(s) referred to in my previous email and paid twice each year, although representing investment in both British and foreign companies, is paid as one single dividend figure or total. It cannot therefore be further broken down and entered as separate amounts under UK dividends, foreign dividends, etc. on the tax return. In view of this, where on the Trust and Estate Tax return do I enter this figure?
e.g. £ 670.00 as a UK and Foreign dividend income from the trust for February 2014?
Finally, do I need to use any of the additional supplementary pages available in relation to the dividend question in the paragaph above?
Many thanks for all your much appreciated advice.
Apologies; the £670.00 in question (actually £ 666.08) was in fact a dividend deriving entirely from overseas unit trusts. Thus there is no split between UK and foreign diviidends, although the nominees do then break this figure down in a Composite Tax Certificate, included in their end of the tax year report.
As you suggested above, the nominees accumulate the dividends and pay them to the trust twice a year.