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650Absolute, limited and discretionary interests

(1)    A person has an absolute interest in the whole or part of the residue of an estate for the purposes of this Chapter if—

(a)    the capital of the residue or that part is properly payable to the person, or

(b)    it would be so payable, if the residue had been ascertained.

(2)    A person has a limited interest in the whole or part of the residue of an estate during any period for the purposes of this Chapter if—

(a)    the person does not have an absolute interest in it, and

(b)    the income from it would be properly payable to the person if the residue had been ascertained at the beginning of that period.

(3)    A person has a discretionary interest in the whole or part of the residue of an estate for the purposes of this Chapter if—

(a)    a discretion may be exercised in the person's favour, and

(b)    on its exercise in the person's favour any of the income of the residue during the whole or part of the administration period (see section 653) would be properly payable to the person if the residue had been ascertained at the beginning of that period.

(4)    For the purposes of this section, an amount is only treated as properly payable to a person if it is properly payable to the person, or to another in the person's right, for the person's benefit, except where subsection (5) applies.

(5)    The personal representatives of a deceased person (“A”) are to be treated as having an absolute or limited interest in the whole or part of the residue of the estate of another deceased person (“B”) if—

(a)    they have a right in their capacity as A's personal representatives, and

(b)    were the right vested in them for their own benefit, they would have that interest in B's estate.

(6)    For the purposes of subsection (4), it does not matter whether the amount is payable directly by the personal representatives or through a trustee or other person.

NOTES
Initial Commencement
Specified date

This Act comes into force on 6 April 2005 and has effect, for the purposes of income tax for the year 2005–06 and subsequent tax years, and for the purposes of corporation tax for accounting periods ending after 5 April 2005: see s 883; for transitional provisions and savings see Sch 2 hereto.
Company Law & Business Entities92 Trusts & Trustees99 Equity & Trusts99 Companies & Corporate Bodies92 Income Tax94 Estate Taxes92 Trading Income94 Administration of Estates92 Personal Representatives & Administration of Estates94 Succession Law & Estate Planning94 Tax Law92 Personal Taxes94

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