TSEM8520 - Trust management expenses: settlor-interested trusts: IIP trust
The settlor of a 鈥榮ettlor-interested鈥� IIP trust gets no relief for TMEs. In ITTOIA/S624 鈥榠ncome which arises under a settlement鈥� in a settlor-interested trust is the income arising to the trustees, that is, the gross income before the trustees pay trust management expenses.
This applies whether or not the settlor is a beneficiary of an IIP trust. If the settlor is also the IIP beneficiary, ITTOIA/S624 deems all the income arising to the trustees to be the settlor鈥檚, and does not explicitly restrict the charge to that part of the trustees鈥� income which does not already belong to the settlor in general law (the trust management expenses).