3 - The Beneficiary

Summary

"Chapter 3 considers the transparent tax treatment of trusts by attribution of trust income to beneficiaries. It begins by identifying the general beneficiary-attribution principles in each of the surveyed countries and the difference of approach between the United Kingdom and the other countries with respect to vested and discretionary entitlements. The inbound and conduit settings applied to non-resident beneficiaries are then considered, differentiating between major income categories. This section includes consideration of the attribution of entity-level business structures to beneficiaries and the interaction between final withholding regimes for dividend, interest and royalty (DIR) income and beneficiary attribution. It is followed by consideration of outbound beneficiary settings, in which a major consideration is the provision of unilateral double tax relief to a resident beneficiary in respect of foreign taxation of trust income, which may have been imposed on the trust or a grantor." See also the appendix in Chapter 10.