Income Tax Act 2007 (c. 3)

Part 15 U.K. Deduction of income tax at source

Modifications etc. (not altering text)

C1 Pt. 15 modified (with effect in accordance with s. 1329(1) of the amending Act) by Corporation Tax Act 2009 (c. 4), ss. 551(4), 1329(1) (with Pts. 1, 2, Sch. 2 para. 78)

Chapter 13 U.K. Unauthorised unit trusts

942 Income tax to be collected from trustees U.K.

(1) This section applies if in a tax year the trustees of an unauthorised unit trust are treated as making deemed payments.

(2) Income tax is to be collected through trustees' self-assessment returns for the tax year (see Chapter 17).

(3) The amount of income tax to be collected (“the collectable amount”) is the amount equal to the sum of the deemed deductions from the deemed payments.

(4) But if the sum of the gross amounts of the deemed payments exceeds the trustees' modified net income for the tax year (see section 1025), the collectable amount is the amount calculated by taking the steps in subsection (5).

(5) The steps to be taken are as follows.

Step 1

Take the amount equal to the sum of the gross amounts of the deemed payments and reduce that amount by—

(a) the amount of the trustees' income pool as at the start of the tax year (see section 943), or

(b) if less, the amount by which the sum of the gross amounts of the deemed payments exceeds the trustees' modified net income.

Step 2

Apply the basic rate for the tax year to the result from Step 1.