Explanatory Notes

Income Tax (Trading and Other Income) Act 2005

2005 CHAPTER 5

24 March 2005

Commentary on Sections

Part 4: Savings and investment income

Chapter 11: Transactions in deposits
Section 551: Charge to tax on profits from disposal of deposit rights

2164.This section is based on sections 56 and 56A of ICTA.

2165.As deposit rights consist of the right to receive interest and the right to the return of the principal amount, subsection (2) makes clear that receiving the principal amount is a disposal of rights for the purposes of the charge to tax but receiving interest is not. Such interest is taxable under Chapter 2 of this Part.