468M Deduction of tax (simple case).U.K.
(1)Subsection (2) below applies where—
(a)an interest distribution is made for a distribution period to a unit holder; and
(b)the gross income entered in the distribution accounts for the purpose of computing the total amount available for distribution to unit holders derives from eligible income entirely.
(2)Where this subsection applies, the obligation to deduct under section 349(2) shall not apply to the interest distribution to the unit holder if the residence condition is on the distribution date fulfilled with respect to him.
(3)Section 468O makes provision with respect to the circumstances in which the residence condition is fulfilled with respect to a unit holder.
(4)Subject to subsection (5) below, in this Chapter “eligible income” means—
(a)any interest on a security which falls within paragraph 5(5)(d) of Schedule 19AA;
(b)any interest on a security which is a quoted Eurobond for the purposes of section 124;
(c)any dividends falling within section 17(1)3;
(d)any proceeds or other realisation falling within section 17(1)4;
(e)any amount taxable by virtue of section 123;
(f)any other amount, if it is not subject to income tax by deduction.
(5)“Eligible income” does not include—
(a)franked investment income;
(b)income under Schedule A;
(c)any foreign income dividend;
(d)any amount afforded relief from taxation imposed under the laws of a territory outside the United Kingdom under arrangements having effect by virtue of section 788 in relation to that territory.