Finance Act 1999

Proportionate reduction of tax by reference to units issued E+W+S+N.I.

4 (1) The amount of tax chargeable shall be proportionately reduced if the number of units of the same class as the unit in question that are surrendered to the managers in the relevant two-week period exceeds the number of units of that class issued by the managers in that period. E+W+S+N.I.

(2) The “relevant two-week period” in relation to a surrender is the period from the beginning of the week in which the surrender occurs to the end of the following week.

For this purpose a week means a period of seven days beginning with a Sunday.

(3) The reduction is made by applying the following fraction to the amount otherwise chargeable—

Where:

• I is the number of units of the class issued by the managers in the relevant two-week period, and

• S is the number of units of the class surrendered to the managers in that period.

(4) If a consolidation or sub-division of units affects the comparison of the number of units surrendered and the number of units issued, the numbers shall be determined as if the consolidation or sub-division had not taken place.

• “Consolidation or sub-division” includes any alteration of the number of units of the class in question otherwise than in consequence of an increase or reduction in the trust property.

(5) This paragraph does not apply if on the surrender of the unit the unit holder receives anything other than money; and for the purposes of this paragraph no account shall be taken of a surrender or issue that is not entirely for money.

[F1 (6) If a certificate is given in accordance with paragraph 6A(1)(c) in respect of a period which includes the relevant two-week period in the case of the unit in question in sub-paragraph (1), there shall be left out of account in applying this paragraph in relation to that unit—

(a) any issue of a unit which is to be held within an individual pension account, and

(b) any surrender of a unit which, immediately before the surrender, was held within an individual pension account.

(7) “Individual pension account” has the same meaning in sub-paragraph (6) as it has in paragraph 6A.]

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Amendments (Textual)

F1 Sch. 19 para. 4(6)(7) inserted (11.5.2001 with effect as mentioned in s. 93(5) of the amending Act) by 2001 c. 9, s. 93(3)

Modifications etc. (not altering text)

C1 Sch. 19 para. 4 modified (6.2.2000) by S.I. 1997/1156, reg. 4A(2) (as inserted (6.2.2000) by S.I. 1999/3261,reg. 5)