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(1)Income tax is charged on—
(a)income which is treated as income of a settlor as a result of section 624 (income where settlor retains an interest),
(b)income which is treated as income of a settlor as a result of section 629 (income paid to [F1relevant] children of settlor),
(c)capital sums which are treated as income of a settlor as a result of section 633 (capital sums paid to settlor by trustees of settlement), and
(d)capital sums which are treated as income of a settlor as a result of section 641 (capital sums paid to settlor by body connected with settlement).
[F2(2)For the purposes of sections 1 to 1B of ICTA, where income of another person is treated as income of the settlor and is charged to tax under subsection (1)(a) or (b) above, it shall be charged in accordance with whichever provisions of the Tax Acts would have been applied in charging it if it had arisen directly to the settlor.]
Textual Amendments
F1Word in s. 619(1)(b) substituted (5.12.2005) by The Tax and Civil Partnership Regulations 2005 (S.I. 2005/3229), reg. 186
F2S. 619(2) substituted (19.7.2006 with effect as mentioned in Sch. 13 para. 5(2) of the amending Act) for s. 619(2)-(4) by Finance Act 2006 (c. 25), s. 89, Sch. 13 para. 5(1)
Valid from 06/04/2007
(1)This section applies to income which is treated as income of a settlor as a result of section 624 (income where settlor retains an interest) or 629 (income paid to unmarried minor children of settlor).
(2)The income is treated as the highest part of the settlor's total income for the purposes of section 619 (so far as it relates to the income).
(3)See section 1012 of ITA 2007 (relationship between highest part rules) for the relationship between—
(a)the rule in subsection (2), and
(b)other rules requiring particular income to be treated as the highest part of a person's total income.]
Textual Amendments
F3S. 619A inserted (6.4.2007 with effect as stated in s. 1034(1) of the amending Act) by Income Tax Act 2007 (c. 3), ss. 1027, 1034, Sch. 1 para. 551 (with transitional provisions and savings in Sch. 2)
(1)In this Chapter—
“settlement” includes any disposition, trust, covenant, agreement, arrangement or transfer of assets (except that it does not include a charitable loan arrangement), and
“settlor”, in relation to a settlement, means any person by whom the settlement was made.
(2)A person is treated for the purposes of this Chapter as having made a settlement if the person has made or entered into the settlement directly or indirectly.
(3)A person is, in particular, treated as having made a settlement if the person—
(a)has provided funds directly or indirectly for the purpose of the settlement,
(b)has undertaken to provide funds directly or indirectly for the purpose of the settlement, or
(c)has made a reciprocal arrangement with another person for the other person to make or enter into the settlement.
(4)This Chapter applies to settlements wherever made.
(5)In this section—
“charitable loan arrangement” means any arrangement so far as it consists of a loan of money made by an individual to a charity either—
for no consideration, or
for a consideration which consists only of interest, and
“charity” includes each of the bodies mentioned in section 507 of ICTA (the National Heritage Memorial Fund, the British Museum etc.).