Readers’ forum: Would UK/Canadian tax relief reduce beneficiary’s tax?

A friend has asked for advice in respect of an estate for which she is acting as executrix. I had to pass because I am not competent to help professionally but I wonder what the answer is.

Her father’s estate included UK and Canadian shares. She has paid UK income tax at 8.75% on the UK dividends – say £87.50 on £1 000 – but no UK tax on the Canadian dividends of £425 because Canadian tax had been paid at 15% (£500 gross).

When she pays the £425 to the beneficiary what does she put on the form R185 and what does the beneficiary put on the tax return?

I feel that the double tax relief should reduce the beneficiary’s liability but I fear that the paperwork may be complicated.

What do readers think?

Query 20 416 – Moose.

All income received...