PART 2Income for the purposes of tax credits

CHAPTER 10Notional Income

Claimants treated for any purpose as having income by virtue of the Income Tax Acts14

1

If an amount is treated for any purpose as the claimant’s income under any provision mentioned in paragraph (2), he is to be treated as having that amount of income.

2

The provisions mentioned in paragraph (1) are—

a

the following provisions of the Taxes Act—

i

section 34 (treatment of premiums etc. as rent)79;

ii

section 56 (transactions in deposits with and without certificates or in debts)80 or 56A (disposal or exercise of rights in pursuance of deposits)81;

iii

section 249 (stock dividends treated as income)82;

iv

section 421 (taxation of borrower when loan to participators in a close company released etc.)83;

v

section 660A (income arising under settlement where settlor retains an interest)84;

vi

section 660B (payments to unmarried minor children of settlor)85;

vii

section 677 (sums paid to settlor otherwise than as income)86 or 678 (capital sums paid by body connected with settlement)87;

viii

section 695 (limited interests in residue of estate in administration)88 or 696 (absolute interests in residue of estate in administration)89;

ix

section 714 (transfers of securities: treatment of deemed sums and reliefs)90 or 716 (transfer of unrealised interest);

x

section 730 (transfer of income arising from securities)91;

xi

section 730A (treatment of price differential on sale and repurchase of securities)92;

xii

section 739 (prevention of avoidance of income tax)93;

xiii

section 740 (liability of non-transferors)94;

xiv

section 761 (charge to income tax of offshore income gain)95; and

xv

section 776 (transactions in land: taxation of chargeable gains)96; and

b

paragraph 1 of Schedule 13 to the Finance Act 1996 (discounted securities: charge to tax on realised profit comprised on a discount).