FAQs - Beneficiaries

Q. I have received a legacy from an estate. How does it affect my tax liability?

A. Usually you will not have any income tax liability when you receive a legacy, unless it consists of an asset that produces income. This includes a bank account, a shareholding or a rented property. The income it produces is your income and should be shown on your personal tax return in the normal way, just as if you bought the asset with your own money.

Usually if it is paid late the personal representative pays you interest on it. The interest is part of your income for tax purposes for the year in which it is paid. You will generally receive the interest without tax deducted. If so you must report it to us even if you do not receive a tax return.