- Y Diweddaraf sydd Ar Gael (Diwygiedig)
- Pwynt Penodol mewn Amser (01/12/2001)
- Gwreiddiol (Fel y'i Deddfwyd)
Point in time view as at 01/12/2001.
Income and Corporation Taxes Act 1988, Cross Heading: Distributions to corporate unit holder is up to date with all changes known to be in force on or before 05 September 2024. There are changes that may be brought into force at a future date. Changes that have been made appear in the content and are referenced with annotations.
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Textual Amendments
F1Ss. 468H-468R and cross-headings inserted (with effect in accordance with Sch. 14 para. 7 of the amending Act) by Finance Act 1994 (c. 9), Sch. 14 para. 2
(1)Subsection (2) below applies where—
(a)a dividend distribution for a distribution period is made to a unit holder by the trustees of an authorised unit trust; and
(b)on the distribution date for that distribution period the unit holder is within the charge to corporation tax.
(2)For the purpose of computing corporation tax chargeable in the case of the unit holder the unfranked part of the dividend distribution shall be deemed—
(a)to be an annual payment and not a dividend distribution F2. . . or an interest distribution; and
(b)to have been received by the unit holder after deduction of income tax at the lower rate for the year of assessment in which the distribution date falls, from a corresponding gross amount.
(3)This is how to calculate the unfranked part of the dividend distribution—
Where—
U = the unfranked part of the dividend distribution to the unit holder;
A = the amount of the dividend distribution;
F3. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
[F4C = such amount of the gross income as does not derive from franked investment income, as reduced by an amount equal to the trustees’ net liability to corporation tax in respect of the gross income;]
[F5D = the amount of the gross income, as reduced by an amount equal to the trustees’ net liability to corporation tax in respect of the gross income;]
[F6(3A)Any reference in this section to the trustees’ net liability to corporation tax in respect of the gross income is a reference to the amount of the liability of the trustees of the authorised unit trust to corporation tax in respect of that gross income less the amount (if any) of any reduction of that liability which is given or falls to be given in accordance with any arrangements having effect by virtue of section 788 or by way of a credit under section 790(1).]
(4)F7. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(5)Where the unit holder is on the distribution date the manager of the scheme, subsection (2) above shall not apply in so far as the rights in respect of which the dividend distribution is made are held by him in the ordinary course of his business as manager of the scheme.
[F8(5A)Where, in relation to a dividend distribution, any tax is deemed to have been deducted by virtue of the application of subsection (2)(b) above, the amount to which the unit holder is entitled by way of repayment of that tax shall not exceed the amount of the unit holder’s portion of the trustees’ net liability to corporation tax in respect of the gross income.
(5B)For the purposes of subsection (5A) above the unit holder’s portion shall be determined by reference to the proportions in which unit holders have rights in the authorised unit trust in the distribution period in question.
(5C)The trustees of the authorised unit trust shall in the appropriate statement sent to the unit holder under section 234A include a statement showing their net liability to corporation tax in respect of the gross income.]
(6)For the purposes of this section the references to the gross income are references to the gross income entered in the distribution accounts for the purpose of computing the total amount available for distribution to unit holders for the distribution period in question.
Textual Amendments
F2Words in s. 468Q(2)(a) repealed (with effect in accordance with s. 36, Sch. 6 para. 8(8) of the repealing Act) by Finance (No. 2) Act 1997 (c. 58), Sch. 6 para. 8(6)(a), Sch. 8 Pt. 2(11), Note
F3Words in s. 468Q(3) repealed (with effect in accordance with s. 36, Sch. 6 para. 8(8) of the repealing Act) by Finance (No. 2) Act 1997 (c. 58), Sch. 6 para. 8(6)(b)(ii), Sch. 8 Pt. 2(11), Note
F4Words in s. 468Q(3) substituted (with effect in accordance with Sch. 3 para. 27(5) of the amending Act) by Finance Act 1998 (c. 36), Sch. 3 para. 27(2)(a)
F5Words in s. 468Q(3) substituted (with effect in accordance with Sch. 3 para. 27(5) of the amending Act) by Finance Act 1998 (c. 36), Sch. 3 para. 27(2)(b)
F6S. 468Q(3A) inserted (with effect in accordance with Sch. 3 para. 27(5) of the amending Act) by Finance Act 1998 (c. 36), Sch. 3 para. 27(3)
F7S. 468Q(4) repealed (with effect in accordance with s. 36, Sch. 6 para. 8(8) of the repealing Act) by Finance (No. 2) Act 1997 (c. 58), Sch. 6 para. 8(6)(c), Sch. 8 Pt. 2(11), Note
F8S. 468Q(5A)-(5C) inserted (with effect in accordance with Sch. 3 para. 27(5) of the amending Act) by Finance Act 1998 (c. 36), Sch. 3 para. 27(4)
F9. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textual Amendments
F9S. 468R repealed (with effect in accordance with s. 36, Sch. 6 para. 8(9) of the repealing Act) by Finance (No. 2) Act 1997 (c. 58), Sch. 6 para. 8(7), Sch. 8 Pt. 2(11), Note
(1)This section applies to—
(a)M1any unit trust scheme [F10that is neither an authorised unit trust nor an umbrella scheme]; F11. . .
(b)F11. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
except where the trustees of the scheme are not resident in the United Kingdom.
(2)Income arising to the trustees of the scheme shall be regarded for the purposes of the Tax Acts as income of the trustees (and not as income of the unit holders) [F12and, in the case of income to which section 1A applies, chargeable to income tax at the basic rate, instead of at the [F13rate applicable in accordance with subsection (1A) of that section]]; and the trustees (and not the unit holders) shall be regarded as the persons to or on whom allowances or charges are to be made under the provisions of those Acts relating to relief for capital expenditure.
[F14(2A)Section 231(1) shall not apply where the recipient of the distribution there mentioned is the trustees of the scheme.
(2B)Section 233(1) shall not apply where the person there mentioned is the trustees of the scheme.]
F15(3)For the purposes of the Tax Acts the unit holders shall be treated as receiving annual payments (made by the trustees under deduction of tax) in proportion to their rights.
(4)The total amount of those annual payments in respect of any distribution period shall be the amount which, after deducting income tax at the basic rate in force for the year of assessment in which the payments are treated as made, is equal to the aggregate amount shown in the accounts of the scheme as income available for payment to unit holders or for investment.
(5)The date on which the annual payments are treated as made shall be the date or latest date provided by the terms of the scheme for any distribution in respect of the distribution period in question, except that, if—
(a)the date so provided is more than 12 months after the end of the period; or
(b)no date is so provided,
the date on which the payments are treated as made shall be the last day of the period.
[F16(5A)Subsection (5B) below applies where for any year of assessment—
(a)the trustees are (or, apart from this subsection, would be) chargeable under section 350 with tax on payments treated as made by them under subsection (3) above, and
(b)there is an uncredited surplus in the case of the scheme.
(5B)Where this subsection applies, the amount on which the trustees would otherwise be so chargeable shall be reduced—
(a)if the surplus is greater than that amount, to nil, or
(b)if it is not, by an amount equal to the surplus.
(5C)For the purposes of subsections (5A) and (5B) above whether there is an uncredited surplus for a year of assessment in the case of a scheme (and, if so, its amount) shall be ascertained by—
(a)determining, for each earlier year of assessment in which the income on which the trustees were chargeable to tax by virtue of subsection (2) above exceeded the amount treated by subsection (3) above as annual payments received by the unit holders, the amount of the excess,
(b)aggregating the amounts determined in the case of the scheme under paragraph (a) above, and
(c)deducting from that aggregate the total of any reductions made in the case of the scheme under subsection (5B) above for earlier years of assessment.
(5D)The references in subsection (5C)(a) above to subsections (2) and (3) above include references to subsections (2) and (3) of section 354A of the 1970 Act.]
(6)In this section “distribution period”[F17means a period beginning on or after 1st April 1987 over which income from the investments subject to the trusts is aggregated for the purposes of ascertaining the amount available for distribution to unit holders, but]—
(a)if the scheme does not make provision for distribution periods, then for the purposes of this section its distribution periods shall be taken to be successive periods of 12 months the first of which began with the day on which the scheme took effect; and
(b)if the scheme makes provision for distribution periods of more than 12 months, then for the purposes of this section each of those periods shall be taken to be divided into two (or more) distribution periods, the second succeeding the first after 12 months (and so on for any further periods).
[F18(6A)In this section “umbrella scheme” has the same meaning as in section 468.]
(7)In this section “unit trust scheme” has the same meaning as in the [F19Financial Services and Markets Act 2000], except that the Treasury may by regulations provide that any scheme of a description specified in the regulations shall be treated as not being a unit trust scheme for the purposes of this section.
(8)Regulations under this section may contain such supplementary and transitional provisions as appear to the Treasury to be necessary or expedient.
(9)Sections 686 [F20, 686A] and 687 shall not apply to a scheme to which this section applies [F21except as respects income to which section 686 is treated as applying by virtue of paragraph 7 of Schedule 5AA.]
(10)Section 720(5) shall not apply in relation to profits or gains treated as received by the trustees of a scheme to which this section applies if or to the extent that those profits or gains represent accruals of interest (within the meaning of Chapter II of Part XVII) which are treated as income in the accounts of the scheme.
(11)This section shall have effect in relation to distribution periods beginning on or after 6th April 1987.
Textual Amendments
F10Words in s. 469(1)(a) substituted (with effect in accordance with s. 113(4)-(11) of the amending Act) by Finance Act 1994 (c. 9), s. 113(3)(a)
F11S. 469(1)(b) and preceding word repealed (with effect in accordance with Sch. 41 Pt. 5(1) Note 2 of the repealing Act) by Finance Act 1996 (c. 8), Sch. 41 Pt. 5(1)
F12Words in s. 469(2) inserted (with effect in accordance with Sch. 6 para. 28 of the amending Act) by Finance Act 1996 (c. 8), Sch. 6 para. 12
F13Words in s. 469(2) substituted (with effect in accordance with Sch. 4 para. 12(5) of the amending Act) by Finance (No. 2) Act 1997 (c. 58), Sch. 4 para. 12(2)
F14S. 469(2A)(2B) inserted (with effect in accordance with Sch. 4 para. 12(5) of the amending Act) by Finance (No. 2) Act 1997 (c. 58), Sch. 4 para. 12(3)
F15Words in s. 469(3) repealed (with effect in accordance with Sch. 41 Pt. 5(1) Note 2 of the repealing Act) by Finance Act 1996 (c. 8), Sch. 41 Pt. 5(1)
F16S. 469(5A)-(5D) inserted by Finance Act 1988 (c. 39), s. 71
F17Words in s. 469(6) substituted (with effect in accordance with Sch. 14 para. 7 of the amending Act) by Finance Act 1994 (c. 9), Sch. 14 para. 5
F18S. 469(6A) inserted (with effect in accordance with s. s. 113(4)-(11) of the amending Act) by Finance Act 1994 (c. 9), s. 113(3)(b)
F19Words in s. 469(7) substituted (1.12.2001) by Financial Services and Markets Act 2000 (c. 8), s. 431(2), Sch. 20 para. 4(4); S.I. 2001/3538, art. 2(1)
F20Words in s. 469(9) inserted (with effect in accordance with Sch. 4 para. 12(5) of the amending Act) by Finance (No. 2) Act 1997 (c. 58), Sch. 4 para. 12(4)
F21Words in s. 469(9) inserted (with effect in accordance with s. 80(6) of the amending Act) by Finance Act 1997 (c. 16), s. 80(5)
Modifications etc. (not altering text)
C1S. 469 extended (27.7.1993) by 1993 c. 37, s. 12, Sch. 2 Pt. I para. 22(1)(2)
C2For regulations see Part III Vol. 5
Marginal Citations
M1Source—1970 s.354A; 1987 s.39; 1987 (No.2) s.40(1)
(1)The Tax Acts shall have effect in relation to any common investment fund established under section 42 of the M2Administration of Justice Act 1982 (common investment funds for money paid into court) as if—
(a)the fund were an authorised unit trust;
(b)the person who is for the time being the investment manager of the fund were the trustee of that authorised unit trust; and
(c)the persons whose interests entitle them, as against the Accountant General, to share in the fund’s investments were the unit holders in that authorised unit trust.
(2)In this section “the Accountant General” means (subject to subsection (3) below) the Accountant General of the Supreme Court of Judicature in England and Wales or the Accountant General of the Supreme Court of Judicature of Northern Ireland.
(3)Where in the case of any common investment fund a person other than the Accountant General is authorised by the Lord Chancellor to hold shares in the fund, the reference in subsection (1)(c) above to the Accountant General shall include a reference to that other person.]
Textual Amendments
F22S. 469A inserted (with effect in accordance with s. 68(3)-(5) of the amending Act) by Finance Act 1999 (c. 16), s. 68(1)
Marginal Citations
(1)F23. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F24(2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(3)F23. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .]
Textual Amendments
F23S. 470(1)(3) repealed (31.7.1998) by Finance Act 1998 (c. 36), Sch. 27 Pt. 3(23)
F24S. 470(2) ceased to have effect (29.4.1988) by virtue of s. 470(3) below and S.I. 1988/745, art. 2
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