Commentary

E1.408 Offshore fund distributions

Personal and employment tax

E1.408 Offshore fund distributions

E1.408 Offshore fund distributions

The income tax treatment of dividends received from offshore funds depends on the underlying investments in the offshore fund. Where more than 60% of the market value of the fund's assets (excluding cash awaiting investment) comprises 'qualifying investments' (as defined in CTA 2009, s 494 but mainly comprising interest-bearing securities and similar economic assets; see D1.788) at any point in the 'relevant period' (defined below) any dividend is treated as interest1. In all other cases the dividend continues to be taxed as a dividend (see E1.416). See B5.702 for the meaning of 'offshore funds'.

The relevant period

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