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Adam Scott, Private client solicitor

Increased work for Executors and Trustees

| Published on April 5, 2016

More Work for Executors and Trustees of small estates and trusts

On the 6th April 2016 the Governments new £1,000 personal savings allowance for individuals’ savings income comes into effect. Of course, this is good news for most but for those administering estates or trusts more work may now be required.

Due to the changes, banks, building societies and National Savings & Investments will stop taxing interest at source. Where previously, no income tax needed to be paid to HMRC, because the tax had already been deducted at source, tax will now need to be paid on the income received gross.

To ease the burden HMRC have introduced transitional provisions in the tax year 2016/2017 so that if the only income received in an estate or trust is savings interest income, and the tax liability on that income is less than £100 then HMRC will not need to be notified.

This is potentially another trap that Executors and Trustees could fall into if they fail to report correctly to HMRC, the penalties for which can be rather harsh. If you have any queries or require assistance relating to the administration of trusts or estates then please contact Adam Scott at our Bournemouth office on 01202 421111.

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