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Trustees |
| | 17. - (1) Subject to the following provisions of this paragraph, this Schedule shall apply as if-
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(a) any reference to an individual included a reference to the trustees of a settlement, and |
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(b) in relation to any such trustees, the reference in paragraph 1(1) above to any asset were a reference to any asset comprised in any settled property to which this paragraph applies (a "trust asset"). |
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(2) This paragraph applies-
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(a) to any settled property in which the interests of the beneficiaries are not interests in possession, if all the beneficiaries are individuals, and |
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(b) to any settled property in which the interests of the beneficiaries are interests in possession, if any of the beneficiaries are individuals. |
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(3) If, at the time of the disposal of the trust asset in a case where this Schedule applies by virtue of this paragraph-
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(a) the settled property comprising that asset is property to which this paragraph applies by virtue of sub-paragraph (2)(b) above, but |
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(b) not all the beneficiaries are individuals, |
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only the relevant proportion of the gain which would accrue to the trustees on the disposal shall be taken into account for the purposes of this Schedule as it so applies.
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(4) This Schedule shall not apply by virtue of this paragraph in a case where, at the time of the disposal of the trust asset, the settled property which comprises that asset is property to which this paragraph applies by virtue of sub-paragraph (2)(a) above unless, immediately after the acquisition of the relevant shares, the settled property comprising the shares is also property to which this paragraph applies by virtue of sub-paragraph (2)(a) above.
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(5) This Schedule shall not apply by virtue of this paragraph in a case where, at the time of the disposal of the trust asset, the settled property which comprises that asset is property to which this paragraph applies by virtue of sub-paragraph (2)(b) above unless, immediately after the acquisition of the relevant shares-
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(a) the settled property comprising the shares is also property to which this paragraph applies by virtue of sub-paragraph (2)(b) above, and |
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(b) if not all the beneficiaries are individuals, the relevant proportion is not less than the proportion which was the relevant proportion at the time of the disposal of the trust asset. |
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(6) If, at any time, in the case of settled property to which this paragraph applies by virtue of sub-paragraph (2)(b) above, both individuals and others have interests in possession, "the relevant proportion" at that time is the proportion which the amount specified in paragraph (a) below bears to the amount specified in paragraph (b) below, that is-
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(a) the total amount of the income of the settled property, being income the interests in which are held by beneficiaries who are individuals, and |
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(b) the total amount of all the income of the settled property. |
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(7) Where, in the case of any settled property in which any beneficiary holds an interest in possession, one or more beneficiaries ("the relevant beneficiaries") hold interests not in possession, this paragraph shall apply as if-
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(a) the interests of the relevant beneficiaries were a single interest in possession, and |
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(b) that interest were held, where all the relevant beneficiaries are individuals, by an individual and, in any other case, by a person who is not an individual. |
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(8) In this paragraph references to interests in possession do not include interests for a fixed term and, except in sub-paragraph (1), references to individuals include any charity.
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Trustees: anti-avoidance |
| | 18. - (1) Paragraphs 13 and 15 above shall have effect in relation to the subscription for shares by the trustees of a settlement as if references to the individual subscribing for the shares were references to-
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(b) any individual or charity by virtue of whose interest, at a relevant time, paragraph 17 above applies to the settled property; or |
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(c) any associate of such an individual, or any person connected with such a charity. |
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(2) The relevant times for the purposes of sub-paragraph (1)(b) above are the time when the shares are issued and-
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(a) in a case where paragraph 13 above applies, the time when the value is received; |
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(b) in a case where paragraph 15 above applies, the time when the loan is made. |
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Interpretation |
| | 19. - (1) For the purposes of this Schedule-
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"arrangements" includes any scheme, agreement or understanding, whether or not legally enforceable; |
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"associate" has the meaning that would be given by subsections (3) and (4) of section 417 of the Taxes Act if in those subsections "relative" did not include a brother or sister; |
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"eligible shares" has the meaning given by section 289(7) of that Act; |
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"the five year period", in the case of any relevant shares, means the period of five years beginning with the issue of the shares; |
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"non-resident" means a person who is neither resident nor ordinarily resident in the United Kingdom; |
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"ordinary share capital" has the same meaning as in the Taxes Act; |
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"ordinary shares", in relation to a company, means shares forming part of its ordinary share capital; |
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"qualifying business activity" has the meaning given by section 289(2) of the Taxes Act; |
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"qualifying company", in relation to any eligible shares, means a company which, in relation to those shares, is a qualifying company for the purposes of Chapter III of Part VII of that Act; |
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"the relevant period", in the case of any shares, means the period found by applying section 312(1A)(a) of that Act by reference to the company that issued the shares and by reference to the shares; |
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"relevant shares", in relation to a case to which this Schedule applies, means any of the shares which are acquired by the investor in making the qualifying investment; |
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"the seven year period" has the meaning given by section 291(6) of the Taxes Act. |
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(2) For the purposes of this Schedule, "deferral relief" is attributable to any shares if-
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(a) expenditure on the shares has been set under this Schedule against the whole or part of any gain; and |
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(b) in relation to the shares there has been no chargeable event for the purposes of this Schedule. |
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(3) In this Schedule-
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(a) references (however expressed) to an issue of eligible shares in any company are to any eligible shares in the company that are of the same class and are issued on the same day; |
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(b) references to a disposal within marriage are references to any disposal to which section 58 applies; and |
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(c) references to Chapter III of Part VII of the Taxes Act or any provision of that Chapter are to that Chapter or provision as it applies in relation to shares issued on or after 1st January 1994. |
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(4) For the purposes of this Schedule shares in a company shall not be treated as being of the same class unless they would be so treated if dealt with on the Stock Exchange.
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(5) Notwithstanding anything in section 288(5), shares shall not for the purposes of this Schedule be treated as issued by reason only of being comprised in a letter of allotment or similar instrument."
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