How is income defined under the NowInfinity Discretionary Trust Deed?

The NI deed has complete flexibility around the income definition and specifically confirms a definition of income according to ordinary concepts.

The trustee can exercise its discretion each year, or at each time a distribution is made and given a resolution is being made, on each occasion anyway, our strong recommendation is that the flexibility is retained, with the backup position (as set out in the deed) that in default of a decision, the definition under section 95 of the Tax Act applies.

Given that a failure to decide will, in our experience, only apply when the resolution itself is void (or not made in time under the Tax Act) – and thus only really arises on an audit – this is the appropriate conservative approach. However, firms can have a template resolution adopting a different default definition which is the approach we recommend be adopted where (say) a default definition, of income according to ordinary concepts is preferred. 

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