I have recently been appointed to act for a client who along with his father is the beneficiary of what I understand is a discretionary trust based in the Isle of Man. The trust was set up by my client’s grandfather who is resident and domiciled in South Africa. My client and his father are UK residents and are both domiciled here.
Income from the trust has been declared on my client’s self-assessment tax return but I understand that a substantial capital distribution has been made in 2020-21. The client wants to use this to buy a new house in the UK and has asked for advice on how much he should put aside from this distribution on account of any eventual tax liability in respect of it. I do not know the exact source of the capital paid to my client from the trust but...
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