How JustAnswer Works:

  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.

Ask jgordosea Your Own Question

jgordosea, Enrolled Agent
Category: UK Tax
Satisfied Customers: 3095
Experience:  I've prepared all types of taxes since 1987.
Type Your UK Tax Question Here...
jgordosea is online now
A new question is answered every 9 seconds

I am the beneficiary of a trust in the US.This person has

Customer Question

I am the beneficiary of a trust in the US.
This person has now died and I wanted to know
If I pay any tax on this money either income or inheritance etc
I am a contractor and pay myself and salary and
Give myself dividends from my company
I am a uk citizen based in uk
Submitted: 1 year ago.
Category: UK Tax
Expert:  jgordosea replied 1 year ago.



Whether a resident or citizen of the United States or a nonresident alien for US income tax purposes there is not any income tax unless and until there is a distribution of income (not corpus) to the beneficiary. Tax on income not distributed is paid by the trust and that is then part of the corpus that can be distributed tax free to the beneficiary according to the terms of the trust.


Non U.S. persons are subject to U.S. income tax only on their U.S. source income and on income effectively connected with a trade or business in the US.


U.S. source income for income tax purposes generally includes (I.R.C. § 871(a)):
- Dividends from U.S. corporations, but not the proceeds of sale of U.S. securities.

- Rent from U.S. real property, and capital gains on the sale of U.S. real property or real property holding companies.

- Interest on debts of U.S. obligors. However, interest on most publicly traded bonds issued after July 18, 1984 constitutes "portfolio interest" and therefore qualifies for the portfolio exemption and is not taxed as U.S. source income (I.R.C. § 871(h)).

- Salaries paid by U.S. and non-U.S. entities for services performed by the recipient in the United States.

- U.S. royalties.


Since income tax must be paid it may need to be withheld on payments of interest(except bank deposits), dividends, and other fixed or determinable annual or periodic (FDAP) U.S.-source income paid to foreign persons. The trust is required to determine and withhold as well as to get Form W8-BEN or similar from the beneficiary.

For withholding rules see Publications/TaxAdviser/2012/december/PublishingImages/mcnamara-exh1.png


For more on W8-BEN see


For more on FDAP see


Federal estate tax is the responsibility of the estate and not the beneficiary. There is no federal inheritance tax due from the beneficiary.


Tax treaties influence the general rules and the required rate of tax:


"The treaty allows both the US and the UK to tax dividends paid to a resident of the other country but, subject to certain conditions, limits the tax the source country may impose to 5% or 15% of the gross amount of the dividend."

You will be subject to 15% rather than 30% rate on dividends under the treaty.


These answers presume that this is a domestic trust in the US and not a foreign trust. That is, the trust is subject to rule of US courts and control of the trust is by US persons. For details see


Please ask if you need more discussion or clarification.

Thank you.






JustAnswer in the News:

Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.

What Customers are Saying:

  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
< Last | Next >
  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
  • I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight. Bonnie Chesnee, SC
  • Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation. John Minneapolis, MN
  • Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with. Orville Hesperia, California
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C. Freshfield, Liverpool, UK
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex Los Angeles, CA
  • Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult. GP Hesperia, CA

Meet The Experts:

  • Andrew Baker(baktax)

    Personal Tax Adviser

    Satisfied Customers:

    35+ years experience in income tax, CGT, non-residence
< Last | Next >
  • Andrew Baker(baktax)'s Avatar

    Andrew Baker(baktax)

    Personal Tax Adviser

    Satisfied Customers:

    35+ years experience in income tax, CGT, non-residence
  • TEAP007's Avatar


    Tax Preparer

    Satisfied Customers:

    Fully Trained Inspector of Taxes / District Inspector/ Team Leader/ Offshore Consultant/ 41 years
  • berduchwal's Avatar



    Satisfied Customers:

    Qualified accountant and bookkeeper running my own practice since 2008.
  • Joshua's Avatar



    Satisfied Customers:

    LL.B (Hons), Higher Prof. Dip. Law & Practice
  • Mrs-Tax's Avatar


    Tax Adviser

    Satisfied Customers:

    Law Degree, 19 years in UK Tax.
  • Thomas's Avatar



    Satisfied Customers:

    Exposure to general tax issues
  • AnthonyL's Avatar


    Tax Adviser

    Satisfied Customers:

    ATT, ATII, 12 years tax experience