[F1528Reduction in amount charged on basis of non-UK residence where individual liable for taxU.K.
(1)Subsection (2) applies if—
(a)an individual is liable for tax charged on a gain from a policy of life insurance or a capital redemption policy, and
(b)there are one or more days in the material interest period [F2that are foreign days].
[F3(1A)Foreign days” are—
(a)days falling within any tax year for which the individual is not UK resident, and
(b)days falling within the overseas part of any tax year that is a split year as respects the individual.]
(2)In determining the individual's liability for tax, the gain on which the tax is charged in the case of the individual is to be reduced by the appropriate fraction.
(3)The appropriate fraction is—
where—
A is the number of days in the material interest period which are [F4foreign days], and
B is the number of days in the material interest period.
(4)In subsection (2) the reference to the gain is to be read in accordance with section 463A(4), 463D(4) or 463E(3) (which relates to restricted relief qualifying policies etc) if applicable.
(5)In this section “the material interest period” means so much of the policy period as during which the individual meets condition A, B or C in section 465 in relation to the policy (subject to subsection (7)).
(6)Subsections (7) and (8) apply if, before the chargeable event, there is an assignment falling within section 487(c) in relation to the policy where the individual is the assignee.
(7)There is to be added to the material interest period any part of the policy period falling before the assignment—
(a)during which the assignor meets condition A, B or C in section 465 in relation to the policy, and
(b)which is not included in the material interest period under subsection (5).
(8)In relation to any period added to the material interest period under subsection (7), in [F5subsection (1A)(a) and (b)] the reference to the individual is to be read as a reference to the assignor.
(9)For the purposes of subsections (5) and (7), in section 465(2) to (4) references to the rights under the policy are to be read as including references to a share of those rights.
(10)In this section “the policy period” means the period for which the policy has run before the chargeable event occurs.
(11)If the policy is a policy of life insurance which is a new policy in relation to another policy, for the purposes of subsection (10) the new policy is to be taken to have run—
(a)from the issue of the other policy, or
(b)if it also was a new policy in relation to an earlier policy, from the issue of the earlier policy,
and so on; and in subsections (5) to (9) references to the policy are to be read accordingly as including any relevant earlier policy.
(12)In subsection (11) “new policy” has the meaning given in paragraph 17 of Schedule 15 to ICTA.]
Textual Amendments
F1Ss. 528, 528A substituted for s. 528 (with effect in accordance with Sch. 8 para. 7 of the amending Act) by Finance Act 2013 (c. 29), Sch. 8 para. 3
F2Words in s. 528(1)(b) substituted (with effect in accordance with Sch. 45 paras. 86(2), 153(2) of the amending Act) by Finance Act 2013 (c. 29), Sch. 45 para. 86(3)
F3S. 528(1A) inserted (with effect in accordance with Sch. 45 paras. 86(2), 153(2) of the amending Act) by Finance Act 2013 (c. 29), Sch. 45 para. 86(4)
F4Words in s. 528(3) substituted (with effect in accordance with Sch. 45 paras. 86(2), 153(2) of the amending Act) by Finance Act 2013 (c. 29), Sch. 45 para. 86(5)
F5Words in s. 528(8) substituted (with effect in accordance with Sch. 45 paras. 86(2), 153(2) of the amending Act) by Finance Act 2013 (c. 29), Sch. 45 para. 86(6)
Modifications etc. (not altering text)
C4S. 528 (as in force immediately before its substitution by Finance Act 2013 (c. 29), Sch. 8 para. 3, so far as that section as so in force continues to have effect after the substitution) amended (with effect in accordance with Sch. 45 para. 153(2) of the amending Act) by Finance Act 2013 (c. 29), Sch. 45 para. 86(7)-(10)
C5Ss. 528, 528A excluded by 1988 c. 1, s. 552(14) (as inserted (with effect in accordance with Sch. 8 para. 7 of the amending Act) by Finance Act 2013 (c. 29), Sch. 8 para. 6)