Discounted Gift Trust, Income Tax

[langtonbrow]

My mother has a discretionary discounted gift trust which pays a regular monthly income set at around 4% of the original investment. The carve out is paid to my mother and, from her, gifted to a non tax payer as education expenses.
The trust appears to be accruing a tax pool as part of its operation which is automatically deducted from the trust annually.
Does my mother need to pay any further tax?
I am new to dealing with her affairs.
Many thanks for any response.

[Lee Young]

You should be directing your questions to the financial adviser who set it up.

The 4% "income" is not normally taxed as income, but rather subject to the chargeable event gains regime.

[maths]

As Lee Young points out it would be sensible to ask the adviser who set it up.

In principle the return of 4% pa of the original investment should fall within the 5% tax deferred capital withdrawals thus precipitating no immediate income tax charge until a chargeable event gain arises (eg on maturity of presumably the single premium bond/encashment or death).

[langtonbrow]

Many thanks. The adviser has unfortunately died. Hence the state of flux.