Williams v Singer [1920] UKHL 2

• The trustees of a marriage settlement, who were UK resident and domiciled, were assessed on income arising to the settlement of shares in a US company.

  • The beneficial life tenant in possession was the Princesse de Polignac who was a French subject by marriage and resident and domiciled outside the UK.

• The major part of the income was from shares in the Singer Manufacturing Co. registered in the name of the trustees.

• The whole of that income was mandated by the trustees to the Princesse and the dividends were paid directly to her account at a bank in New York.

• None of the income was received in the UK.

Viscount Cave

• The fact is that if the Income Tax Acts are examined, it will be found that the person charged with tax is neither the trustee nor the beneficiary as such but the person in actual receipt and control of the income which it is sought to reach.

• The object of the Act is to secure for the State a proportion of the profits chargeable, and this end is attained by the simple and effective expedient of taxing the profits where they are found.

• If the beneficiary receives and controls them he is liable to be assessed upon them. If the trustee receives and controls them, then he is primarily so liable.

• Accordingly, his opinion was that the trustees were not assessable. Lords Atkinson and Shaw concurred.

• This new approach was followed in Kelly v Rogers where the UK resident trustee under a New Jersey will for his incapacitated sister was held properly assessable.

RELATED CASES

• Baker v Archer-Shee

• Kelly v Rogers