26.—(1) This regulation applies if an interest distribution is made for a distribution period to a participant chargeable to income tax.
(2) Any obligation to deduct a sum under section 349(2) of ICTA M1 is subject to the provisions of this regulation.
(3) In this Part the “deduction obligation” means the obligation specified in paragraph (2).
(4) The deduction obligation does not apply to the interest distribution if—
(a)the participant is a company;
(b)the participant consists of the trustees of a unit trust scheme;
(c)the reputable intermediary condition is met with respect to a participant on the distribution date (see regulation 27); [F1or]
(d)the residence condition is met with respect to a participant on the distribution date (see regulation 30); F2...
F2(e). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(5) But if the participant is a company which is the trustee of the trust to which (or under which) the interest distribution is made (or received), the deduction obligation is not excluded by virtue of paragraph (4)(a).
(6) In its application to an interest distribution to a participant in respect of accumulation units, the deduction obligation is an obligation to deduct a sum out of the amount being credited to scheme capital on the participant's behalf.
Textual Amendments
F1Word in reg. 26(4)(c) inserted (6.4.2007) by The Authorised Investment Funds (Tax) (Amendment No. 2) Regulations 2007 (S.I. 2007/794), regs. 1(1), 3
F2Reg. 26(4)(e) and preceding word revoked (6.4.2007) by The Authorised Investment Funds (Tax) (Amendment No. 2) Regulations 2007 (S.I. 2007/794), regs. 1(1), 8(b)
Marginal Citations
M1Section 349(2) was amended by paragraph 1(2) of Schedule 11 to the Finance Act 1991 (c. 31), paragraph 18 of Schedule 14 to the Finance Act 1996 (c. 8) and paragraph 148(2) of Schedule 1 to the Income Tax (Trading and Other Income) Act 2005 (c. 5).