Part 9Special rules about settlements and trustees
Chapter 9Unauthorised unit trusts
506Special rules for trustees affected by section 733 of ICTA
1
This section applies if—
a
interest payable to the trustees of an unauthorised unit trust in respect of securities (“the affected income”) is attributable to a tax year,
b
because of section 733(1) of ICTA (dividend buying etc: persons entitled to exemptions), some part of the affected income is not exempt from income tax, and
c
the trustees are treated as making deemed payments in the tax year.
2
For the purposes of section 505(7) the trustees' modified net income for the tax year is reduced by the amount of the affected income.
3
In this section “interest” and “securities” are to be read in accordance with section 731(9) of ICTA.