13.—(1) Regulation 48 (dividend distributions: general) is amended as follows.
(2) In paragraph (2), before the words “For the purpose of” insert “Subject to paragraphs (2A) and (2B),”.
(3) In paragraph (2)(b)—
(a)for “lower rate” substitute “basic rate”; and
(b)for “year of assessment” substitute “tax year”.
(4) After paragraph (2) insert—
“(2A) But paragraph (2) does not apply to a dividend distribution to which section 95 of ICTA (1) or section 219(4) of FA 1994(2) applies.
(2B) If, on the distribution date, the participant is the manager of the authorised investment fund, paragraph (2) shall not apply to the extent that the rights in respect of which the dividend distribution is made are held by him in the ordinary course of the manager’s business as manager of the fund.”
(5) After paragraph (3) insert—
“(4) This regulation does not apply in respect of a holding in a qualified investor scheme if the scheme has not met the genuine diversity of ownership condition in regulation 14C in relation to an accounting period.”
1988, c. 1. The provisions of section 95 were substituted by section 24 of, and Schedule 8 to, the Finance (No. 2) Act 1997 (c. 58) in relation to any distribution made on or after 2 July 1997; by sections 882, 883 and 884 of, and Schedule 1 to, the Income Tax (Trading and Other Income) Act 2005 (c. 5); by section 69 of, and Schedule 7 to, the Finance Act 1997 (c. 16) in relation to distributions made on or after 26 November 2006; by section 216 of, and Schedule 43 to, the Finance Act 2003 (c. 14); and by section 137(2) of the Finance Act 2004 (c. 12).
1994, c. 9. Subsection (4) was amended by section 22 of, and Schedule 8 to, the Finance (No. 2) Act 1997 (c. 58) and S.I. 2001/3629.