Income Tax (Trading and Other Income) Act 2005 section 680

Income treated as bearing income tax

Section 680 establishes the rules for determining how different types of income within an estate in administration are treated as bearing income tax, and the rates at which that tax is deemed to have been borne.

• Where a UK estate's total income for a tax year falls at or below the de minimis estates threshold, all of that income is treated as bearing income tax at 0%.
• Stock dividends and released loans to deceased participators in close companies that form part of the estate's aggregate income are treated as bearing income tax at 0%.
• Gains from life insurance contracts and similar items included in the estate's aggregate income are treated as bearing income tax at the basic rate.
• Income tax deemed to have been borne on estate income under the grossing-up rules cannot be repaid to the extent the underlying basic amount is paid from sums treated as bearing tax at 0% or from sums otherwise covered by this section.