My beneficiary’s US trust has 6,500 interest with no tax deducted at source and 22,000 dividends with 30% tax deducted. Will HMRC allow a 15% FTCR across the whole of the trust income ie £28,500 x 15% = 4,275.
The tax return leads one to look through to the underlying income and declare interest and dividends separately which then leads to only 3,300 FTCR.
Has anyone seen HMRC having a lenient approach to this?
Jane Lawrence
The 140 Trustee Co Ltd
Jane
In my experience HMRC are quite hot on this, especially if there is an enquiry. there is very detailed guidance and they expect any over deduction to be reclaimed from the country that deducted it at source. In any event dividend income and interest or savings income are taxed at different rates in the UK and as you have noted, need to be entered onto different parts of the tax return so the FTC may not be ‘shared’
Maxine Higgins
Citroen Wells
Per Help Sheet HS 263: “If you have more than one source of income or capital gains eligible for relief, a separate calculation needs to be performed for each item, rather than combining them all together”.
Malcolm Finney
Thank you for the replies, I will revert to the USA trustees and ask about the 30% tax rate.
Jane Lawrence
The 140 Trustee Co Ltd