Corporation Tax Act 2010

Authorised unit trusts

616 Meaning of “authorised unit trust” and “unit holder”

(1) In this Chapter “authorised unit trust” means, in relation to an accounting period, a unit trust scheme in respect of which an order under section 243 of FISMA 2000 is in force during the whole or part of the period.

(2) In this Chapter “unit holder” means a person entitled to a share of the investments subject to the trusts of a unit trust scheme.

(3) Subsections (1) and (2) are subject to section 619 (umbrella schemes).

617 Authorised unit trust treated as UK resident company

(1) In respect of income arising to the trustees of an authorised unit trust, and for the purposes of the provisions relating to relief for capital expenditure, the Tax Acts have effect as if—

(a) the trustees were a UK resident company, and

(b) the rights of the unit holders were shares in the company.

(2) References in the Corporation Tax Acts to a body corporate are to be read in accordance with subsection (1); and sections 1104 to 1107 (companies required to provide tax certificates) apply with any necessary modifications.

(3) Subsection (1)(b) does not affect the making of distributions which are interest distributions to unit holders.

(4) “Interest distributions” has the meaning given by regulations made under section 17(3) of F(No.2)A 2005.

618 Applicable corporation tax rate

The rate of corporation tax in relation to an authorised unit trust for any financial year is the rate at which income tax at the basic rate is charged for the tax year beginning on 6 April in that financial year (and sections 18 and 19 (relief for companies with small profits) do not apply).

619 Umbrella schemes

(1) In this section “umbrella scheme” means a unit trust scheme—

(a) which provides arrangements for separate pooling of the contributions of the participants and the profits or income out of which payments are made to them (“pooling arrangements”),

(b) under which the participants are entitled to exchange rights in one pool for rights in another, and

(c) in respect of which an order under section 243 of FISMA 2000 is in force.

(2) References in this section to a part of an umbrella scheme are to such of the pooling arrangements as relate to a separate pool.

(3) For the purposes of this Chapter—

(a) each of the parts of an umbrella scheme is to be regarded as an authorised unit trust, and

(b) the umbrella scheme as a whole is not to be regarded as an authorised unit trust.

(4) In relation to a part of an umbrella scheme, references to investments subject to the trusts of an authorised unit trust are references to such of the investments as under the pooling arrangements form part of the separate pool to which the part relates.

(5) In relation to a part of an umbrella scheme, references to a unit holder are references to a person for the time being having rights in that separate pool.