PART III SETTLED PROPERTY
C1C2C3C4 CHAPTER III SETTLEMENTS WITHOUT INTERESTS IN POSSESSION F3, 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
Principal charge to tax
64 Charge at ten-year anniversary.
F11
Where immediately before a ten-year anniversary all or any part of the property comprised in a settlement is relevant property, tax shall be charged at the rate applicable under sections 66 and 67 below on the value of the property or part at that time.
F41A
For the purposes of subsection (1) above, property held by the trustees of a settlement immediately before a ten-year anniversary is to be regarded as relevant property comprised in the settlement at that time if—
a
it is income of the settlement,
b
the income arose before the start of the five years ending immediately before the ten-year anniversary,
c
the income arose (directly or indirectly) from property comprised in the settlement that, when the income arose, was relevant property, and
d
when the income arose, no person was beneficially entitled to an interest in possession in the property from which the income arose.
1B
Where the settlor of F7property comprised in a settlement was not domiciled in the United Kingdom at the time the F8property became comprised in the settlement (but see also subsection (1BA))F5and is not a formerly domiciled resident for the tax year in which the ten-year anniversary falls, income of the settlement F9that arose (directly or indirectly) from the property is not to be regarded as relevant property comprised in the settlement as a result of subsection (1A) above so far as the income—
a
is situated outside the United Kingdom, or
b
is represented by a holding in an authorised unit trust or a share in an open-ended investment company.
F61BA
If—
a
an amount is payable in respect of property (“the existing property”) comprised in a settlement, and
b
the amount represents an accumulation of income which (once accumulated) becomes comprised in the settlement,
subsection (1B) has effect, in the case of the amount, as if any reference to the time it became comprised in the settlement were to the time the existing property became comprised in the settlement.
1C
Income of the settlement is not to be regarded as relevant property comprised in the settlement as a result of subsection (1A) above so far as the income—
a
is represented by securities issued by the Treasury subject to a condition of the kind mentioned in subsection (2) of section 6 above, and
b
it is shown that all known persons for whose benefit the settled property or income from it has been or might be applied, or who are or might become beneficially entitled to an interest in possession in it, are persons of a description specified in the condition in question.
F22
For the purposes of subsection (1) above, a foreign-owned work of art which is situated in the United Kingdom for one or more of the purposes of public display, cleaning and restoration (and for no other purpose) is not to be regarded as relevant property.
Words in Pt. 3 Ch. 3 heading added (22.3.2006) by Finance Act 2006 (c. 25), s. 156, Sch. 20 para. 20(5)