Discretionary Trust created under Deceased’s Will Not Liable to Income Tax at Maximum Marginal Rate u/s 164: ITAT

The ITAT (Income Tax Appellate Tribunal) ruled that a "discretionary trust created under a deceased's will is not liable to income tax at the maximum marginal rate under Section 164." Section 164 levies the maximum marginal rate of tax on certain trusts. However, the tribunal clarified that if a discretionary trust is created by a will for the benefit of specific individuals, it falls under an exception to Section 164, and its income should be taxed at the normal rates applicable to individual beneficiaries, not the maximum marginal rate.