PAIFs—compliance and vouchers
Produced in partnership with Martin Shah of Simmons & Simmons LLP based on material originally written by Charles Goddard of Rosetta Tax LLP
PAIFs—compliance and vouchers

The following Tax practice note produced in partnership with Martin Shah of Simmons & Simmons LLP based on material originally written by Charles Goddard of Rosetta Tax LLP provides comprehensive and up to date legal information covering:

  • PAIFs—compliance and vouchers
  • Corporation tax returns and obligations with regard to HMRC
  • Deduction of tax from distributions
  • Property income distributions
  • PAIF distributions (interest)
  • Accounting for tax
  • Tax deduction vouchers
  • Consequences of a mistake in applying the rules on withholdings

As well as ensuring they continue to meet the conditions for the tax regime under which they operate, Property Authorised Investment Funds (PAIFs) must comply with a number of rules regarding their tax administration.

This Practice Note considers the compliance rules applicable to PAIFs in three areas:

  1. corporation tax returns and obligations with regard to HMRC

  2. deduction of tax from distributions and accounting for that tax to HMRC, and

  3. requirement to issue vouchers to participators in respect of distributions

The tax features of PAIFs, to which these obligations relate, are dealt with broadly in Practice Note: PAIFs—summary.

Particular details of the PAIF regime are examined in more detail in Practice Notes:

  1. PAIFs—the conditions

  2. PAIFs—taxation of the scheme

  3. PAIFs—taxation of the participants, and

  4. PAIFs—breach of the conditions and exit

In this Practice Note, references to the AIF Regulations are to the Authorised Investment Funds (Tax) Regulations 2006, SI 2006/964.

Corporation tax returns and obligations with regard to HMRC

A PAIF is subject to the usual requirements regarding submission of corporation tax returns and payment of any tax. As such, it must submit a single corporation tax return following the end of, and in respect of, each accounting period.

However, the PAIF’s return will differ in some respects from that submitted by other types of company.

The key difference is that the entries on the form should only relate to its non-ring-fenced

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