ANNEX 1:: MINOR CHANGES IN THE LAW MADE BY THE BILL This change is adverse to some taxpayers and favourable to others in principle. But it is expected to have no practical effect as it is in line with current practice. Change 90: Settlements: tax statements for settlors: section 495
This change allows the settlor of a trust to require a statement from the trustees where the income is regarded as that of the settlor rather than a beneficiary.
Section 352 of ICTA applies where trustees make a payment in the exercise of a discretion. It allows the recipient to require the trustees to provide a statement of the actual amount of the payment, the corresponding gross amount (grossing up at the trust rate) and the amount of tax deemed to have been deducted.
This is appropriate where the beneficiary is chargeable on the payment, but in a case where the settlor is chargeable under section 629 of ITTOIA it is that person who will need these details.
Accordingly, section 495 says that it is the person who is treated as having paid the income tax on the payment who may require a statement from the trustees.