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Income tax

Although the income tax regime provides that bare trusts are not subject to the rules that apply to other types of trust, it does not explicitly say how to treat the income arising from property held in a bare trust. The following rules have been established:

1. •

   any income arising to a bare trustee is assessable on the beneficiary as they are absolutely entitled to that income

2. •

   the beneficiary must declare any income on their personal tax return

3. •

   although the bare trustee may pay income tax on behalf