Hello, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question.
Trusts are a complex area of taxation, but I am of the opinion that this income is taxable in your mother's hands. The Trustees may be, indeed should be, deducting tax from this distribution at the basic rate [20%].
I am so sorry to have to rain on your parade.
State Pension (SP) is taxable Francis, but paid gross. The recovery is usually achieved by reducing the tax code allocated to her NHS pension to achieve a tax neutral position at the year end.
The exact rate on the investment income might be slightly lower, but that depends upon the type of investment and the range can be large.
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