HMRC Form R185: Trust and Estate Income, Rates, and Tax Pool

To complete HMRC Form R185, choose the variant that matches the source of the income (Trust Income, Estate Income, Pension Scheme Admin, or LSDB), enter the beneficiary’s share of income net of tax alongside the tax treated as deducted, and pass the signed form to the beneficiary. You do not send it to HMRC. The numbered boxes on the R185 map directly to boxes on the beneficiary’s SA107 supplementary pages, so the figures you enter become the figures they copy across.

Pick the Right Version First

Four versions of the R185 exist, and using the wrong one causes problems when the beneficiary reports the income.

The two pension variants apply only where a taxable lump sum death benefit is in play. Most people completing an R185 are using either Trust Income or Estate Income, and the guidance below covers those two.

Completing R185 (Trust Income)

Download the form from GOV.UK and confirm you are using the version for the correct UK tax year, which runs 6 April to 5 April.5GOV.UK. Self Assessment Tax Returns: Deadlines At the top, enter the trust’s name, address, and tax reference, and the beneficiary’s name and address.

Then work through the numbered boxes. Each box asks for a net amount of income (after tax taken off), with the tax treated as deducted shown on the line below.6HM Revenue and Customs. HMRC Form R185 Trust Income

  • Box 1: net payments from non-settlor-interested UK resident trusts, excluding anything reported in box 2, after tax taken off at the trust rate.
  • Box 2: total payments from a settlor-interested trust to a beneficiary who is not the settlor. Enter the actual payment; do not gross it up, and do not include payments made to the settlor.
  • Box 3: net non-savings income taxed at the basic rate. Rental income belongs here; interest and dividends do not.
  • Box 4: net savings income taxed at the basic rate. This is bank and building society interest. The tax paid line below gives the beneficiary their credit.
  • Box 5: net dividend income taxed at the dividend rate, with the tax paid on the line below.
  • Box 6: untaxed income, including trust income within the tax-free amount. Attach a separate sheet identifying the income type.
  • Box 7: foreign income. Show the gross amount before any tax, the foreign tax paid, and the UK tax paid, each on its own line. The beneficiary carries these to their SA106 Foreign pages.

Enter figures to the penny where the underlying records allow it. A rounding shortcut in one box tends to surface as a mismatch on the beneficiary’s return.

Applying the Right Trust Rates

The tax credit you show depends on the type of trust. Accumulation and discretionary trusts pay 45% on non-dividend income and 39.35% on dividend income. Interest in possession trusts pay 20% on non-dividend income and 10.75% on dividends.7GOV.UK. Trusts and Income Tax Applying the wrong rate produces a wrong credit on the R185, which either shortchanges the beneficiary or invites an HMRC enquiry.

The Tax Pool for Discretionary Trusts

If you run a discretionary trust, keep a running tax pool alongside the R185. The pool records tax the trustees have actually paid; every payment to a beneficiary that carries a 45% credit draws that credit out of the pool.8HM Revenue & Customs. Find Out About Taxable Items, Tax Pools and Deductions for Trusts A shortfall occurs when the credits attached to distributions exceed what is in the pool. This is common where some income sat within the tax-free amount, was taxed below 45%, or came from life insurance policy gains — only 25% (the difference between the trust rate and the basic rate) of those gains feeds the pool. Any shortfall is paid by the trustees through the Trust and Estate Tax Return (SA900). Issuing R185s with credits the trust has not funded is a route to a penalty.

Completing R185 (Estate Income)

Personal representatives use this version during the administration period, meaning the window between the death and the final distribution of estate assets. Interest, rent, dividends and other income the estate earns in that window has to be reported to beneficiaries so they can pick it up on their own returns.

The numbered boxes on this form line up with SA107 boxes 16 to 25.9HM Revenue and Customs. R185 (Estate Income)

  • Box 16: non-savings income after tax taken off, including rental income and trade profits, with the tax paid on the line below.
  • Box 17: savings income after tax taken off — bank and building society interest — with tax paid below.
  • Box 18: dividend income after tax taken off, from UK and foreign companies, with tax paid or credit below.
  • Box 19: non-savings income taxed at the non-repayable basic rate, which includes gains on certain life insurance policies. The credit on this income cannot be reclaimed by the beneficiary, so flag it correctly.
  • Boxes 22 to 24: foreign estate income, relief for UK tax already accounted for, and foreign tax where Foreign Tax Credit Relief has not been claimed.
  • Box 25: residential property income or restricted finance costs for calculating residential finance cost relief.

Show the net income and the exact tax withheld side by side. If the estate earned £1,000 of savings interest and £200 of tax was paid, the form carries the £800 net and the £200 credit. The beneficiary needs both numbers to reconcile their return.

Getting the Form to the Beneficiary

Sign the completed form and give the original to the beneficiary. You do not file the R185 with HMRC. HMRC may later ask the beneficiary to produce it, but it is not attached to their tax return.10HM Revenue & Customs. SA107 Notes 2024-25

Issue the form as soon as you can after 5 April so the beneficiary has time to file. For the 2025–26 tax year, the paper Self Assessment deadline is 31 October 2026 and the online deadline is 31 January 2027. A late filing triggers an automatic £100 penalty, daily penalties of £10 (up to £900) after three months, and further charges of 5% of the tax due or £300 (whichever is greater) at six and twelve months.11GOV.UK. Self Assessment Tax Returns: Penalties A beneficiary who misses the deadline because they were waiting for the R185 will look to the trustee or personal representative for an explanation.

Records to Keep

Trustees must retain the records that support both the trust’s own return and every R185 issued. If the trust has business income, keep records for five years after the 31 January filing deadline. If there is no business income, one year after that deadline is enough.12GOV.UK. Records to Keep for Trusts A 2025–26 return filed by 31 January 2027 means non-business records should be held until 31 January 2028, and business records until 31 January 2032.

Keep a copy of each R185 you issue for the same period. HMRC can open an enquiry within twelve months of the beneficiary’s filing date, and the R185 is the document that ties the numbers on their SA107 back to the trust or estate.