TSEM1564 - Introduction to trusts: types of trust: interest in possession trust
»Ê¹ÚÌåÓýappre is no statutory definition of ‘interest in possessionâ€�.
A Board’s Press Notice dated 12 February 1976 indicates that an interest in possession ‘exists� where the person having the interest has the immediate entitlement (subject to any prior claims by the trustees for expenses or other outgoings properly payable out of income) to any income produced…as the income arises�.�
See CG36320 for a more detailed explanation.Â
Sometimes we refer to interest in possession trusts as ‘non-discretionaryâ€� trusts. »Ê¹ÚÌåÓýapp interest in possession beneficiary is sometimes referred to as having a ‘life interestâ€� or being the ‘life tenantâ€�. See also TSEM6203.
»Ê¹ÚÌåÓýapp interest in possession beneficiary is taxable on the trust income after allowable trust management expenses. See TSEM3760+.