# The Capital Gains Tax (Definition of Unit Trust Scheme) Regulations 1988

S.I. 1988/266 · made 18 February 1988

These Regulations provide for certain unauthorised unit trust schemes to be excepted from the definition of unit trust scheme for the purposes of capital gains tax given by section 92(1)(a) of the Capital Gains Tax Act 1979 (“section 92(1)(a)”). As substituted by section 40(3) of the Finance Act 1987, that section provides that “unit trust scheme” is to have the same meaning as in the Financial Services Act 1986. Two types of unit trust scheme are excepted from the definition in section 92(1)(a) by these Regulations: limited partnership schemes and approved profit sharing schemes. In the case of limited partnership schemes the liability of the trustees and unit holders for the purposes of capital gains tax will accord with the legal nature of the relationship between them, as established by the terms of the scheme. Approved profit sharing schemes will be taxed in accordance with section 53(5) of the Finance Act 1978.

Made under: Capital Gains Tax Act 1979 (repealed 6.3.1992) (Section 92)

PDFs: Printed copy https://openlegislation.uk/capital-gains-tax-definition-of-unit-trust-scheme-regulations-1988/pdf/uksi_19880266_en.pdf

## Introductory text

TAXES
Made 18th February 1988
Laid before the House of Commons 18th February 1988
Coming into force 11th March 1988
The Treasury, in exercise of the powers conferred on them by section 92 of the Capital Gains Tax Act 1979, hereby make the following Regulations:

## 1 Citation and commencement

These Regulations may be cited as the Capital Gains Tax (Definition of Unit Trust Scheme) Regulations 1988 and shall come into force on 11th March 1988.

## 2 Interpretation

In these Regulations unless the context otherwise requires—
“limited partnership” means a limited partnership registered under the Limited Partnerships Act 1907 and “general partner” and “limited partner” have the same meanings as in that Act,
“limited partnership scheme” means a unit trust scheme of the description specified in regulation 4;
“participant” in relation to a unit trust scheme, has the meaning given by section 75(2) of the Financial Services Act 1986;
“the principal Act” means the Capital Gains Tax Act 1979;
“scheme property” means, in relation to a unit trust scheme, property of any description, including money, which is held on trust for the participants in the scheme;
“unit trust scheme” means a scheme which, apart from these Regulations, is a unit trust scheme for the purposes of the principal Act.

## 3 Exception of certain unit trust schemes from the principal Act

A unit trust scheme which is—
(a) a limited partnership scheme, or
(b) a profit sharing scheme which has been approved in accordance with Part I of Schedule 9 to the Finance Act 1978,
shall be treated as not being a unit trust scheme for the purposes of the principal Act.

## 4 Description of a limited partnership scheme

A unit trust scheme is a limited partnership scheme when the scheme property is held on trust for the general partners and the limited partners in a limited partnership.

## Signature

David Lightbown
Mark Lennox-Boyd
Two of the Lords Commissioners of Her Majesty’s Treasury
18th February 1988

## Explanatory note

(This note is not part of the Regulations)
These Regulations provide for certain unauthorised unit trust schemes to be excepted from the definition of unit trust scheme for the purposes of capital gains tax given by section 92(1)(a) of the Capital Gains Tax Act 1979 (“section 92(1)(a)”). As substituted by section 40(3) of the Finance Act 1987, that section provides that “unit trust scheme” is to have the same meaning as in the Financial Services Act 1986. Two types of unit trust scheme are excepted from the definition in section 92(1)(a) by these Regulations: limited partnership schemes and approved profit sharing schemes. In the case of limited partnership schemes the liability of the trustees and unit holders for the purposes of capital gains tax will accord with the legal nature of the relationship between them, as established by the terms of the scheme. Approved profit sharing schemes will be taxed in accordance with section 53(5) of the Finance Act 1978.
Regulation 1 provides for the title and commencement.
Regulation 2 contains definitions.
Regulation 3 provides that limited partnership schemes and approved profit sharing schemes are to be excepted from the definition of “unit trust scheme” in section 92(1)(a).
Regulation 4 describes a limited partnership scheme.

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Source: https://www.legislation.gov.uk/uksi/1988/266 (the official version)
Page: https://openlegislation.uk/capital-gains-tax-definition-of-unit-trust-scheme-regulations-1988
Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.