Trust Taxes - Isle on Man Investment & Trust, but UK resident Trustees and Beneficiaries

Hello, We have a situation where a Chargeable Event occurred on an Isle of Man based investment bond, within a discretionary trust. The settlor has died and the Chargeable Event happened in the tax year after she died. The Trustees and Beneficiaries are all UK resident. I understand that if the Trust is a UK Trustees would be liable for the taxes due (at Trust tax rates). However, the Trust in question is an Isle of Man Trust, so not under UK law. I also understand that the tax is not chargeable in the Isle of Man, but in the UK (where everyone associated with the Trust are resident). My question is, would the UK tax liability still be assessable on the Trustees (at UK Trust tax rates) or would the UK tax liability either be taxable on the beneficiaries (at personal income tax rates / added to their tax year taxable income) or the trustees (at personal income tax rates / added to their tax year taxable income)? Any help would be much appreciated. Kind regards 

Name removed admin .

Not sure if anyone has any experience or come across this before? Does someone at HMRC know how this will be treated? Ultimately, the Trustees / Beneficiaries want to do the right thing and pay all the taxes they owe (without any issues arising) - but are struggling to understand who is liable to the tax (trustees or beneficiaries) and at what rates the tax would be payable (i.e. trustees tax rate or personal tax rates).

Hi,

Please refer to guidance at:

Non-resident trusts

Thank you.

Hi HMRC Admin 32 - thank you for your help. I have referred to the Non-resident trusts link, however this Trust's Trustees are all UK resident - but the Trust is set up under Isle of Man law and the surrendered investment was Isle of Man based / under Isle of Man law. We believe tax is due in the UK as all of the settlor (decreased in the previous tax year from surrender), Trustees, and Beneficiaries are UK residents - we are still uncertain who is liable to the tax and at what tax rates (personal or trustees). Thank you for any help anyone provides.

Hi
This would need to be confirmed with the Trust Helpline on 0300 123 1072.