Case Law

In Carver v Duncan 1985 STC 356 the Court held that the UK legislation should be given a secondary meaning. Firstly, there was the provision whereby the trust deed contained no express provisions concerning the allocation of expenses as between income and capital and secondly where the trust deed concerned express provisions regarding the allocating of income and capital. The court held the legislation was to be interpreted as allowing a deduction only for expense properly chargeable to income under general law disregarding the terms of the trust.

Receipts which are regarded as income for tax purposes but as capital for trust law purposes do not fall within section 805(2)(a). Howell and Anor v Trippier (Inspector of Taxes) 2004 STC 1245