Section 413: Person liable
1670.This section states who is liable for any tax charged and is based on section 249(4) to (6) of ICTA.
1671.Subsection (2) deals with individuals who are beneficially entitled to the stock dividend income. Such individuals could include outright owners, a beneficiary of a bare trust or one with an interest in possession, or the beneficial owner under a nominee arrangement.
1672.Subsection (3) indicates that the trustees of an accumulation and discretionary trust are the persons liable if:
stock dividends are issued to them; and
had the trustees been paid a cash dividend in respect of the shares, any of that cash dividend would be income to which section 686 of ICTA applies (accumulation and discretionary trusts: special rates of tax).
1673.Subsection (4) deals with stock dividend income arising to personal representatives during the administration of a deceased person’s estate. As personal representatives are not charged to tax under Chapter 5 of this Part they are not “persons liable”. This means that they are not treated as having paid income tax under section 414 but see further the commentary on section 680.
1674.Subsections (5) and (6) deal with joint ownership of share capital and are based on section 249(3) of ICTA.
