Income and Corporation Taxes Act 1970

354 Authorised unit trusts

(1) In respect of income and chargeable gains arising to the trustees of an authorised unit trust, the Tax Acts shall have effect—

(a) as if the trustees were a company, resident in the United Kingdom, whose business consists mainly in the making of investments and the principal part of whose income is derived therefrom, and

(b) as if the rights of the unit holders were shares in the company, and

(c) as if so much of the income arising to the trustees as is available for payment to unit holders or for investment were dividends on such shares paid to them in proportion to their rights, the date of payment, in the case of income not paid to unit holders, being taken to be—

(i) the date or latest date provided by the terms of the authorised unit trust for any distribution in respect of the distribution period in question,

(ii) if no date is so provided, the last day of the distribution period;

and references in the Corporation Tax Acts to a body corporate shall be construed in accordance with this subsection.

(2) Without prejudice to the generality of the preceding provisions—

(a) sums periodically appropriated out of income or chargeable gains arising as aforesaid for managers' remuneration shall be treated for the purposes of section 304 of this Act as sums disbursed as expenses of management,

(b) the proportion of income attributable to any unit holder, being income not paid to unit holders but available for investment, shall be treated as an amount paid to the unit holder after such deduction of tax as is authorised by section 232(3) of this Act (Schedule F),

(c) section 242 of this Act (explanation of income tax deductions to be annexed to dividend warrants, etc.) shall apply with any necessary modifications.

(3) In ascertaining the amount available for distribution to unit holders in respect of any distribution period the trustees of an authorised unit trust may make such adjustments as may be reasonably required to allow for liabilities to and reliefs from tax where the amount of the liability or relief is not yet ascertained.

(4) In this section " distribution period " means a period 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.