Part III

Individuals, partnerships, trusts and collective investment schemes etc
Chapter II

Settlements

Migration of settlements, non-resident settlements and dual resident settlements

Migrant settlements etc.
89
1
Where a period of one or more years of assessment for which section 87 applies to a settlement (“a non-resident period”) succeeds a period of one or more years of assessment for each of which section 87 does not apply to the settlement (“a resident period”), a capital payment received by a beneficiary in the resident period shall be disregarded for the purposes of sections 87 and 87A if it was not made in anticipation of a disposal made by the trustees in the non-resident period.
1A
Subsection (2) applies to a settlement if—
a
a non-resident period is succeeded by a resident period, and
b
in relation to the last tax year in the non-resident period (“the last non-resident tax year”), section 87A(3) applied by virtue of paragraph (a) of that provision (exhaustion of capital payments).
2
Chargeable gains are treated as accruing in a tax year (in the resident period) to a beneficiary of the settlement who receives a capital payment from the trustees in that year if all or part of the capital payment is matched (under section 87A as it applies for that year) with
the section 1(3) amount
for the last non-resident tax year or any earlier tax year.
3
Section 87(3) and (4) and sections 87A to
87P
apply for the purposes of subsection (2) as if the relevant tax year were the tax year mentioned in subsection (2).
4
Section 87B (remittance basis) applies in relation to chargeable gains treated under subsection (2) as accruing as it applies in relation to chargeable gains treated under section 87 as accruing.
Words in s. 89(1) substituted (with effect in accordance with Sch. 7 para. 115 of the amending Act) by Finance Act 2008 (c. 9), Sch. 7 para. 110(2)
Ss. 87-89 modified (21.7.2008) by Finance Act 2008 (c. 9), Sch. 7 para. 125(2)
Ss. 87, 87A, 87C-90 applied (with modifications) by Income and Corporation Taxes Act 1988 (c. 1), s. 762(3) (as substituted (with effect in accordance with Sch. 7 para. 98 of the amending Act) by Finance Act 2008 (c. 9), Sch. 7 para. 93(3))
Word in Pt. 3 heading inserted (with effect in accordance with Sch. 22 para. 12 of the amending Act) by Finance Act 2009 (c. 10), Sch. 22 para. 9; S.I. 2010/670, art. 2
Word in s. 89(3) substituted (with effect in accordance with Sch. 10 para. 1(16) of the amending Act) by Finance Act 2018 (c. 3), Sch. 10 para. 1(6)
Words in s. 89(2) substituted (with effect in accordance with Sch. 1 paras. 120, 123 of the amending Act) by Finance Act 2019 (c. 1), Sch. 1 para. 42
Ss. 87-90A applied (with modifications) (with effect in accordance with art. 1(2)(3), Sch. 1 of the amending S.I.) by The Offshore Funds (Tax) Regulations 2009 (S.I. 2009/3001), regs. 1(1), 20(3)(4)
S. 89(1A)-(4) substituted for s. 89(2)(3) (with effect in accordance with Sch. 7 para. 115 of the amending Act) by Finance Act 2008 (c. 9), Sch. 7 para. 110(3) (with Sch. 7 para. 123)