Income Tax (Trading and Other Income) Act 2005

624Income where settlor retains an interestU.K.
This section has no associated Explanatory Notes

(1)Income which arises under a settlement is treated for income tax purposes as the income of the settlor and of the settlor alone if it arises—

(a)during the life of the settlor, and

(b)from property in which the settlor has an interest.

[F1(1A)If the settlement is a trust, expenses of the trustees are not to be used to reduce the income of the settlor.]

(2)For more on a settlor having an interest in property, see section 625.

(3)For exceptions to the rule in subsection (1), see—

  • section 626 (exception for outright gifts between spouses [F2or civil partners]),

  • section 627 (exceptions for certain types of income), and

  • section 628 (exception for gifts to charities).

Textual Amendments

F1S. 624(1A) inserted (6.4.2007 with effect as stated in s. 1034(1) of the amending Act) by Income Tax Act 2007 (c. 3), ss. 1027, 1034, Sch. 1 para. 553 (with transitional provisions and savings in Sch. 2)