UnderwritersU.K.
18(1)An underwriting member of Lloyd’s shall be treated for the purposes of this Schedule as absolutely entitled as against the trustees to the securities forming part of his premiums trust fund, his special reserve fund (if any) and any other trust fund required or authorised by the rules of Lloyd’s, or required by the underwriting agent through whom his business or any part of it is carried on, to be kept in connection with the business.
(2)Sub-paragraph (1) above applies where a disposal is made on or after 14th March 1989 (whatever the date of acquisition).
(3)Where a security forms part of a premiums trust fund at the end of 31st December of any relevant year, for the purposes of this Schedule the trustees of the fund shall be deemed to dispose of the security at that time; and for this purpose relevant years are 1989 and subsequent years.
(4)Where a security forms part of a premiums trust fund at the beginning of 1st January of any relevant year, for the purposes of this Schedule the trustees of the fund shall be deemed to acquire the security at that time; and for this purpose relevant years are 1990 and subsequent years.
(5)Sub-paragraph (6) below applies where the following state of affairs exists at the beginning of 1st January of any year or the end of 31st December of any year—
(a)securities have been transferred by the trustees of a premiums trust fund in pursuance of an arrangement mentioned in section 129(1) or (2),
(b)the transfer was made to enable another person to fulfil a contract or to make a transfer,
(c)securities have not been transferred in return, and
(d)section 129(3) to the transfer made by the trustees.
(6)The securities transferred by the trustees shall be treated for the purposes of sub-paragraphs (3) and (4) above as if they formed part of the premiums trust fund at the beginning of 1st January concerned or the end of 31st December concerned (as the case may be).
(7)Paragraph 7 above shall have effect subject to sub-paragraph (3)above.
(8)Paragraph 7(2) above shall not apply where—
(a)the deceased was an underwriting member of Lloyd’s who died on or after 14th March 1989, and
(b)immediately before his death the security concerned formed part of a premiums trust fund, a special reserve fund or any other trust fund required or authorised by the rules of Lloyd’s, or required by the underwriting agent through whom the deceased’s business or any part of it was carried on, to be kept in connection with the business.
(9)In a case where an amount treated as income chargeable to tax by virtue of paragraph 4(1) above constitutes profits or gains mentioned in section 450(1)—
(a)section 450(1)(b) shall apply; and
(b)paragraph 4(1)(b) above shall not apply.
(10)For the purpose of computing income tax for the year 1987-88 sub-paragraph (9) above shall have effect as if—
(a)the reference to section 450(1) were to paragraph 2 of Schedule 16 to the Finance Act 1973, and
(b)the reference to section 450(1)(b) were to paragraph 2(b) of that Schedule.
(11)In this paragraph “business” and “” have the meanings given by section 457.
Modifications etc. (not altering text)
C1 See 1979(C) s.132A(5)(6)—deep discount securities.