Part 14

Income tax liability: miscellaneous rules
Chapter A1

Remittance basis

Business investment relief

Income or gains treated as remitted following certain events
809VG
1
Subsection (2) applies if—
a
income or chargeable gains are treated under section 809VA(2) as not remitted to the United Kingdom as a result of a qualifying investment,
b
a potentially chargeable event occurs after the investment is made, and
c
the appropriate mitigation steps are not taken within the grace period allowed for each step.
2
The affected income or gains are to be treated as having been remitted to the United Kingdom immediately after the end of the relevant grace period.
3
Where the step required by section 809VI(2)(a) is not taken within the grace period allowed for that step, “the relevant grace period” is the grace period allowed for that step.
4
Otherwise, “the relevant grace period” is the grace period allowed for the step required by section 809VI(1) or (2)(b).
5
“
The affected income or gains
” means such portion of the income or gains mentioned in subsection (1)(a) as reflects the portion of the investment affected by the potentially chargeable event.
6
The portion of the investment affected is—
a
if the potentially chargeable event is a disposal of a part of the holding (or a part of the remaining holding), a portion equal to the portion of the holding (or remaining holding) being disposed of, and
b
otherwise, the whole of the investment.
6A
Where—
a
the income or gains mentioned in subsection (1)(a) include amounts designated as TRF capital (in a tax year after the tax year in which the investment is made), and
b
the portion of the investment affected is less than the whole of the investment,
so much of the affected income or gains as does not exceed the amounts designated is to be treated as being comprised of the TRF capital.
6B
Where section 809VO (investments made from mixed funds) applies, subsection (8) of that section applies for the purposes of determining the composition of the amount of the affected income or gains that is not treated as being comprised of TRF capital (referred to as the “
relevant affected income and gains
” in that subsection) as a result of—
a
subsection (6A) of this section not applying, or
b
that subsection only applying to a part of the affected income or gains.
7
Section
809VN (order of disposals
etc
)
makes
further provision for the purposes of this section.
8
If a qualifying investment is made using the money or other property mentioned in section 809VA(3) together with other funds—
a
that investment is to be treated as two separate investments, one made using the money or other property mentioned in section 809VA(3) and one made using the other funds, and
b
references in the business investment provisions to “the investment” and “the holding” relate only to the investment made using the money or other property mentioned in section 809VA(3).
9
If the potentially chargeable event mentioned in subsection (1)(b) is not the first such event to affect the investment, the income or gains mentioned in subsection (1)(a) do not include, as respects that investment—
a
any part already treated under subsection (2) as remitted to the United Kingdom as a result of an earlier event,
aa
any part contained in amounts already treated as remitted under section 809VIA(4) following an earlier event,
b
any part contained in amounts already taken offshore or re-invested by way of appropriate mitigation steps following an earlier event, or
c
any part contained in amounts already used to make a tax deposit without which an amount mentioned in paragraph (b) would not have been enough to satisfy section 809VI(1) or (2)(b) (see section 809VK).
Pt. 14 Ch. A1 modified by 2003 c. 1, s. 41F(8) (as substituted (6.4.2015) by Finance Act 2014 (c. 26), Sch. 9 paras. 5, 47 (with Sch. 9 para. 48))
Pt. 14 Ch. A1 modified by 2005 c. 5, s. 643F(4) (as inserted (with effect for the tax year 2018-19 and subsequent years) by Finance Act 2018 (c. 3), Sch. 10 paras. 11, 21(1) (with Sch. 11 para. 22))
Pt. 14 Ch. A1 modified (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), 19(3)
Pt. 14 Ch. A1 inserted (21.7.2008 with effect in accordance with Sch. 7 para. 81 of the amending Act) by Finance Act 2008 (c. 9), Sch. 7 para. 1 (with Sch. 7 paras. 85-89)
Word in s. 809VG(7) substituted (for the tax year 2025-26 and subsequent tax years) by Finance Act 2025 (c. 8), Sch. 10 paras. 19(3)(b)(i), 21(1)
Pt. 14 Ch. A1 modified by 2005 c. 5, s. 643N(3)(4) (as inserted (with effect for the tax year 2018-19 and subsequent years) by Finance Act 2018 (c. 3), Sch. 10 paras. 11, 21(1) (with Sch. 11 para. 22))
S. 809VG(6A)(6B) inserted (for the tax year 2025-26 and subsequent tax years) by Finance Act 2025 (c. 8), Sch. 10 paras. 19(3)(a), 21(1)
S. 809VG(9)(aa) inserted (for the tax year 2025-26 and subsequent tax years) by Finance Act 2025 (c. 8), Sch. 10 paras. 19(3)(c), 21(1)
Word in s. 809VG(7) substituted (for the tax year 2025-26 and subsequent tax years) by Finance Act 2025 (c. 8), Sch. 10 paras. 19(3)(b)(ii), 21(1)
Pt. 14 Ch. A1 modified (temp.) (for the tax years 2025-26, 2026-27 and 2027-28) by Finance Act 2025 (c. 8), Sch. 10 para. 18(1)(2)
Ss. 809VA-809VO and cross-heading inserted (17.7.2012) (with effect in accordance with Sch. 12 para. 17 of the amending Act) by Finance Act 2012 (c. 14), Sch. 12 para. 7
Ss. 809L-809Z6 applied by 2005 c. 5, s. 643I(9) (as inserted (with effect for the tax year 2018-19 and subsequent years) by Finance Act 2018 (c. 3), Sch. 10 paras. 11, 21(1) (with Sch. 11 para. 22))
Ss. 809L-809Z6 applied by 2005 c. 5, s. 643A(6) (as inserted (with effect for the tax year 2018-19 and subsequent years) by Finance Act 2018 (c. 3), Sch. 10 paras. 11, 21(1) (with Sch. 11 para. 22))
Pt. 14 Ch. A1 modified by 2003 c. 1, s. 41A(8) (as inserted (21.7.2008 with effect in accordance with Sch. 7 para. 80 of the amending Act) by Finance Act 2008 (c. 9), Sch. 7 para. 22)
Pt. 14 Ch. A1 modified by 1988 c. 1, s. 762ZB(3) (as inserted (21.7.2008 with effect in accordance with Sch. 7 para. 98 of the amending Act) by Finance Act 2008 (c. 9), Sch. 7 para. 94)
Pt. 14 Ch. A1 modified by 1992 c. 12, s. 87B(3) (as inserted (21.7.2008 with effect in accordance with Sch. 7 para. 115 of the amending Act) by Finance Act 2008 (c. 9), Sch. 7 para. 108 (with Sch. 7 paras. 116-119))