Drummond v Collins [1915] 6 TC 525
Judgement for the case Drummond v Collins
Table Of Contents
Payments made in pursuance of a discretion count as the income of the beneficiary to whom they are paid.
Sums were paid of income from an American Will Trust for the maintenance of minor grandchildren of the testator.
The sums paid were advances pursuant to a clause allowing payments for suitable maintenance and education of the child to be made as the trustees in their uncontrolled discretion might think neccessary or advisable.
The assessments were affirmed by HL as being on profits or gains from foreign possessions liable to income tax.
Lord Lorebourne
These were not true voluntary payments:
They were payments in fulfillment of the testamentary disposition for the benefit of the children in the exercise of a discretion conferred by the will. They were the children’s income.
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