Copyright royalties received by trustees: rate of tax
In Trustees of the Mrs PL Travers Will Trust v HMRC (TC02830 – 22 August) a company (C) produced a stage musical in 2004 based on a children’s book written in the 1930s. From 2004/05 to 2008/09 copyright royalties from the musical were paid to the trustees of a settlement created on the death of the author of the book (T). The trustees submitted tax returns on the basis that these royalties were only liable to the basic rate of income tax. HMRC issued a ruling that these royalties were taxable at the higher rate applicable to trust income by virtue of what is now ITA 2007 s 479. The trustees appealed. The First-tier Tribunal allowed the appeal in part holding that the effect of Law of Property Act 1925 s 164 (which has subsequently been repealed)...
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Copyright royalties received by trustees: rate of tax
In Trustees of the Mrs PL Travers Will Trust v HMRC (TC02830 – 22 August) a company (C) produced a stage musical in 2004 based on a children’s book written in the 1930s. From 2004/05 to 2008/09 copyright royalties from the musical were paid to the trustees of a settlement created on the death of the author of the book (T). The trustees submitted tax returns on the basis that these royalties were only liable to the basic rate of income tax. HMRC issued a ruling that these royalties were taxable at the higher rate applicable to trust income by virtue of what is now ITA 2007 s 479. The trustees appealed. The First-tier Tribunal allowed the appeal in part holding that the effect of Law of Property Act 1925 s 164 (which has subsequently been repealed)...
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