Geoffrey T.

HS265 Offshore funds does not address my question. We correctly report gains on our offshore funds as income. The only advice I can find is that income for gifts out of surplus income cannot include gains from bonds since these are regarded as capital gains not income. That is true for onshore bonds and any gains from them have to be reported as capital. Gains from our offshore bonds are correctly reported as income. It would seem therefore that they should also be regarded as income and used as such when calculating surplus income for gifts out of surplus income. I am simply asking for clarification since this does not seem to be addressed in any HMRC literature that I can find.

Off shore bond gains are treated as income for tax returns. Are the gains regarded as income for gifts out of surplus income?