The following Trusts and Inheritance Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:
The code is a widely drafted set of anti-avoidance provisions that seek to prevent the avoidance of UK taxation by transferring assets abroad. For the code to apply, there needs to be a transfer of assets by a UK resident individual, such that income deriving from those assets becomes payable to a ‘person’ abroad. This guidance note outlines the elements of the code and where it fits into the non-UK resident trust landscape.
In its simplest form, the code will attach to arrangements involving non-UK trusts, companies and foundations into which ‘assets’ are transferred by a UK resident individual. The definition of asset is very widely cast and can be sited within or without the UK.
There is a degree of overlap between the provisions of the code and other provisions relating to the taxation of income or capital gains. These are noted in the text with an indication of which rules take precedence.
In addition, there is a ‘motive defence’ to the charging provisions, which provides an exemption to the code where there is no tax avoidance purpose or where a genuine commercial reason for the transfer exists. See below.
Refer to INTM600060 for a checklist of indicators of arrangements caught by the code.
The code applies when a ‘relevant transfer’ occurs. To counter what is regarded as an avoidance transaction, the individual who makes the transfer or who benefits from it becomes subject to income tax. The key terms are defined as follows.
A transfer is a ‘relevant transfer’ if it is a transfer of assets and as a result of the transfer and / or one or more associated operations, income from those assets becomes payable to a person abroad, eg a trust, company or foundation that is established outside the UK.
‘Asset’ includes property or rights of any kind and includes:
shares or obligations of any company to which the assets, income or
**Free trials are only available to individuals based in the UK. We may terminate this trial at any time or decide not to give a trial, for any reason.
Access this article and thousands of others like it free for 7 days with a trial of TolleyGuidance.
Read full article
Already a subscriber? Login
The supply of fuel and power is treated as a supply of goods for VAT purposes. Supplies are fuel and power are normally liable to VAT at the standard rate. However, providing certain conditions are satisfied, it is possible for suppliers to charge the reduced rate of VAT on certain supplies of fuel
IP COMPLETION DAY: 11pm (GMT) on 31 December 2020 marked the end of the Brexit transition / implementation period entered into following the UK’s withdrawal from the EU. At this point in time, key transitional arrangements came to an end and significant changes began to take effect across the UK’s
This guidance note explains the general rules surrounding the availability of indexation allowance on the disposal of company assets and provides information on the rebasing rules for assets held on 31 March 1982. For an overview of the general position regarding company disposals, please refer to
On the disposal of the shares in a company, a seller may receive loan stock in the acquiring company as consideration or part consideration for the sale. For tax purposes, loan notes are either qualifying corporate bonds (QCBs) or non-QCBs (NQCBs). The expression ‘corporate bond’ is a general