PART III SETTLED PROPERTY
C1C2C3C4 CHAPTER III SETTLEMENTS WITHOUT INTERESTS IN POSSESSION F1, AND CERTAIN SETTLEMENTS IN WHICH INTERESTS IN POSSESSION SUBSIST
See Finance Act 1990 s. 126—exemption for pools payments to trustees for football ground improvements in respect of events on or after 6April 1990.
Pt. 3 Ch. 3 modified (22.7.2004) by Finance Act 2004 (c. 12), s. 283, Sch. 36 para. 57(1) (with s. 283(5))
Pt. 3 Ch. 3 modified (22.7.2004) by Finance Act 2004 (c. 12), s. 283, Sch. 36 para. 56(2)(b) (with s. 283(5))
Part III Chapter III (ss.58-85) excluded by Finance Act 1991 (c.31, SIF 63:1), s. 121(4).
Pt. III Ch. III (ss. 58-85) restricted (3.5.1994) by 1994 c. 9, s. 248
Special cases—charges to tax
74AF2Arrangements involving acquisition of interest in settled property etc
1
This section applies where—
a
one or more persons enter into arrangements,
b
in the course of the arrangements—
i
an individual (“the individual”) domiciled in the United Kingdom acquires or becomes able to acquire (directly or indirectly) an interest in property comprised in a settlement ( “
the relevant settled property
”
), and
ii
consideration in money or money's worth is given by one or more of the persons mentioned in paragraph (a) (whether or not in connection with the acquisition of that interest or the individual becoming able to acquire it),
c
there is a relevant reduction in the value of the individual's estate, and
d
condition A or condition B is met.
2
Condition A is that—
a
the settlor was not domiciled in the United Kingdom at the time the F3relevant settled property became comprised in the settlement, and
b
the relevant settled property is situated outside the United Kingdom at any time during the course of the arrangements.
3
Condition B is that—
a
the settlor was not an individual or a close company at the time the F4relevant settled property became comprised in the settlement, and
b
condition A is not met.
4
Subsection (6) applies if all or a part of a relevant reduction (“amount A”) is attributable to the value of the individual's section 49(1) property being less than it would have been in the absence of the arrangements.
5
“The individual's section 49(1) property” means settled property to which the individual is treated as beneficially entitled under section 49(1) by reason of the individual being beneficially entitled to an interest in possession in the property.
6
Where this subsection applies—
a
a part of that interest in possession is deemed, for the purposes of section 52, to come to an end at the relevant time, and
b
that section applies in relation to the coming to an end of that part as if the reference in subsection (4)(a) of that section to a corresponding part of the whole value of the property in which the interest in possession subsists were a reference to amount A.
7
Subsection (8) applies to so much (if any) of a relevant reduction as is not amount A (“amount B”).
8
Tax is to be charged as if the individual had made a transfer of value at the relevant time and the value transferred by it had been equal to amount B.
Words in Pt. 3 Ch. 3 heading added (22.3.2006) by Finance Act 2006 (c. 25), s. 156, Sch. 20 para. 20(5)