Part 10Special rules about charitable trusts etc

Other exemptions

532Exemption for savings and investment income

1

The income mentioned in subsection (2) is not taken into account in calculating total income if—

a

it is income of a charitable trust, or

b

it is required, under an Act, court judgment, charter, trust deed or will, to be applied to charitable purposes only.

2

The income referred to in subsection (1) is—

a

interest,

b

a dividend or other distribution of a UK resident company,

c

a dividend of a non-UK resident company,

d

an annuity payment under a purchased life annuity,

e

profits on the disposal of deeply discounted securities, or

f

income treated for the purposes of Chapter 10 of Part 4 of ITTOIA 2005 (distributions from unauthorised unit trusts) as received by a unit holder from a scheme to which section 547 of that Act applies (unauthorised unit trust schemes).

3

Subsection (1) applies only so far as the income falls within, and is dealt with under, Part 4 of ITTOIA 2005 (see section 366 of that Act as to provisions given priority over Part 4).

4

Subsection (1) applies so far as the income is applied to charitable purposes only.

5

In this section—

  • “deeply discounted security” has the same meaning as in Chapter 8 of Part 4 of ITTOIA 2005 (profits from deeply discounted securities) (see section 430 of that Act),

  • “disposal”, in relation to a deeply discounted security, has the same meaning as in Chapter 8 of Part 4 of that Act (see section 437(1) of that Act),

  • “dividend”, in relation to a UK resident company, has the same meaning as in Chapter 3 of Part 4 of that Act (dividends etc from UK resident companies etc) (see section 382(4) of that Act),

  • “interest” includes anything treated as interest for the purposes of Chapter 2 of Part 4 of that Act (interest), and

  • “purchased life annuity” has the same meaning as in Chapter 7 of Part 4 of that Act (purchased life annuity payments) (see section 423 of that Act).