Commentary on Sections Part 10: Miscellaneous income Overview Section 943: Absolute interests
2373.This section explains how to calculate the basic amount of estate income for absolute interests. It is based on section 696(3) to (5) of ICTA. The corresponding rule for income tax is in section 660 of ITTOIA.
2374.This section removes all the deeming of amounts to have been paid in Part 16 of ICTA. Instead, it looks at either amounts actually paid or the assumed income entitlement. It then catches all previously untaxed income due to the absolute interest holder by taxing the assumed income entitlement in the final accounting period. This avoids the two stage process inherent in section 696(5) of ICTA.
2375.Subsection (3) introduces a new rule allowing excess estate deductions in the final year to be set off against the basic amount of estate income for the final accounting period. See Change 69 in Annex 1.