SCHEDULES
F1SCHEDULE 4CTransfers of value: attribution of gains to beneficiaries
Increase in tax payable under this Schedule
13
1
This paragraph applies where—
a
a capital payment is made by the trustees of a settlement,
b
the payment is made in circumstances where paragraph 8 above treats chargeable gains as accruing in respect of the payment, and
c
a beneficiary is charged to tax in respect of the payment by virtue of that paragraph.
2
The tax payable by the beneficiary in respect of the payment shall be increased by the amount found under sub-paragraph (3) below, except that it shall not be increased beyond the amount of the payment; and an assessment may charge tax accordingly.
3
The amount is one equal to the interest that would be yielded if an amount equal to the tax which would be payable by the beneficiary in respect of the payment (apart from this paragraph) carried interest for the chargeable period at the specified rate.
The “specified rate” means the rate for the time being specified in section 91(3).
4
The chargeable period is the period which—
a
begins with the later of the 2 days specified in sub-paragraph (5) below, and
b
ends with 30th November in the year of assessment following that in which the capital payment is made.
5
The 2 days are—
a
1st December in the year of assessment following that in which the transfer of value was made, and
b
1st December falling 6 years before 1st December in the year of assessment following that in which the capital payment is made.
Sch. 4C inserted (with effect in accordance with s. 92(5) of the amending Act) by Finance Act 2000 (c. 17), s. 92(4), Sch. 26 Pt. I