Oral trust income taxation subjects trustees receiving beneficiary income to the maximum marginal rate under an overriding charging rule.

Section 308 establishes a special charging rule for income received or receivable by a trustee on behalf of, or for the benefit of, any person under an oral trust. Where the trustee is entitled to such income and it arises under an oral trust, the income is chargeable at the maximum marginal rate. "Oral trust" has the meaning assigned under section 303(3), and the provision applies irrespective of anything contained in any other provision of the Act.

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