Taxation of authorised investment funds (AIFs)—taxation of the fund
Produced in partnership with Camilla Spielman
Taxation of authorised investment funds (AIFs)—taxation of the fund

The following Tax practice note Produced in partnership with Camilla Spielman provides comprehensive and up to date legal information covering:

  • Taxation of authorised investment funds (AIFs)—taxation of the fund
  • Taxation of AIFs—the basics
  • The legislation
  • OEICs and AUTs
  • OEICs and AUTs generally taxed in the same way
  • AIFs taxed as UK companies subject to special rules
  • Importance of the trading v investment distinction
  • Distributions—bond funds v equity funds
  • Umbrella funds
  • Qualified investor schemes (QIS)
  • More...

This Practice Note looks at the rules that apply to the taxation of authorised investment funds (AIFs), which is the collective term used for certain authorised and regulated funds which take the form of either open-ended investment companies (OEICs) or authorised unit trusts (AUTs). This Practice Note does not consider the taxation of authorised contractual schemes (ACSs).

For the tax treatment of investors in an AIF (as opposed to the taxation of the fund itself), see Practice Notes:

  1. AIFs—taxation of corporate participants, and

  2. AIFs—taxation of individual participants

For the types of funds that meet the definition of an AIF and an overview of the relevant regulatory framework, see Practice Note: Authorised investment funds (AIFs)—what are they?

For the taxation of Property AIFs (PAIFs), a special category of AIFs, see Practice Note: PAIFs—taxation of the scheme. For the rules applying to another special category of AIFs, known as tax elected funds (TEFs), see Practice Note: AIFs—tax elected funds.

Taxation of AIFs—the basics

The legislation

Most of the tax rules applicable to AIFs are contained in the Authorised Investment Funds (Tax) Regulations 2006, SI 2006/964 (AIF (Tax) Regs). In addition, some key rules are contained in the Corporation Tax Act 2010 (CTA 2010) and the Taxation of Chargeable Gains Act 1992 (TCGA 1992).

OEICs and AUTs

The term ‘authorised investment funds’ (AIFs) is used in the tax legislation to refer collectively to both

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