Tax implications on bonds held in trust

ognum

What are the tax implications of encashing bonds held in my fathers discretionarty trust following the death of my mother?
If the bond has a chargable event does this mean there is no further tax to apply?
Thanks for any help with this

thenudeone

The taxation of bonds in a trust is an extremely complex subject but it is possible to work out the tax by plodding through the HMRC website.

kidmugsy

Are your "bonds" insurance company bonds? If so I'd be looking for advice from an accountant with expertise in this area because I have none.

lordbase

This is a dangerous area, the taxation of trusts and bonds are complex areas. The liability could be as much as 50% as chargeable events on Bonds are often charged on your highest marginal rate (after something called top slicing relief) which for trusts is 50%.

There is some guidance here http://www.taxationweb.co.uk/forum/chargeable-event-gain-in-a-trust-who-pays-tax-t19620.html, but as you can see it's probably something you should get professional advice on from a tax professional as there are a number of complicating factors.

System

That's the tax rate payable on income distributions from trusts. If this is a capital distribution, then other rules apply. I know enough to know I'd need proper expert advice in those circumstances.