Part 5Miscellaneous income

Chapter 5Settlements: amounts treated as income of settlor or family

Income treated as income of settlor: relevant children

629Income paid to F1relevant children of settlor

(1)

Income which arises under a settlement is treated for income tax purposes as the income of the settlor and of the settlor alone for a tax year if, in that year and during the life of the settlor, it—

(a)

is paid to, or for the benefit of, F2a relevant child of the settlor, or

(b)

would otherwise be treated (apart from this section) as income of F2a relevant child of the settlor.

(2)

Subsection (1) does not apply to income which is treated as income of the settlor under section 624.

(3)

Subsection (1) does not apply in relation to a child's relevant settlement income in any tax year if, in that year, the total amount of that income does not exceed £100.

(4)

In subsection (3) a child's “relevant settlement income” means income—

(a)

which is paid to or for the benefit of, or otherwise treated as income of, the child, and

(b)

which (apart from subsection (3)) would be treated as income of the settlor under subsection (1).

(5)

Subsection (1) does not apply so far as provided by section 630 (exception for gifts to charities) F3....

(6)

See—

  • section 631 for the treatment for the purposes of subsection (1) of retained or accumulated income, and

  • section 632 for the treatment for the purposes of this section and section 631 of certain deemed income connected to offshore income gains.

(7)

In this section and sections 631 and 632—

(a)

“child” includes a stepchild,

(b)

“minor” means a person under the age of 18 years, and “minor child” is to be read accordingly, F4. . .

(c)

references to payments include payments in money's worth F5, and

F6(d)

“relevant child” means a minor child who is unmarried or not in a civil partnership.

F7(8)

Subsection (1) is subject to section 28A of FA 2005.