Regulation 19 Winding up of a RIF that is UK property rich
This regulation applies where—
a RIF ceases to meet the UK property rich condition at a time when the operator of the RIF is taking steps with a view to disposal of all the assets of the RIF so that it can be wound up, and
the RIF does not meet any of the other restriction conditions.
Each participant in the RIF is deemed, for the purposes of TCGA 1992 to, immediately before the time that the RIF ceases to meet the UK property rich condition, have—
sold their units in the RIF, and
reacquired those units,
at their market value at that time.
The operator of the RIF must notify the participants in the RIF of any deemed disposal of their units in the RIF under paragraph (2) within the period of 30 days beginning with the day on which the RIF ceased to meet the UK property rich condition.
For the purposes of these Regulations the RIF is otherwise to be treated as if it continued to meet the UK property rich condition for a period (“the winding up period”) of two years beginning with the day on which the RIF ceased to meet the UK property rich condition, and including any extension of that period under this regulation.
The winding up period may be extended where the operator of the RIF makes an application to HMRC which must—
be made no earlier than 60 days, and no later than 30 days, before the end of the winding up period,
set out the further period for which the winding up period should be extended, and
set out the steps the operator of the RIF will take to wind up the scheme within that further period.
The application will be treated as granted unless an officer of HMRC gives a notice (“a refusal notice”) to the operator of the RIF within a period of 30 days, beginning with the day on which the application was received by HMRC.
A refusal notice must give the officer’s reasons for the decision and may—
refuse to extend the winding up period, or
agree to such extension of the winding up period as the officer thinks is reasonable.
The operator of a RIF may bring an appeal against a refusal notice.
The appeal must be made by notice given to HMRC within the period of 30 days beginning with the day on which the refusal notice was given to the operator of the RIF.
Where a notice is given to HMRC, the winding up period is treated as continuing until the appeal is determined or withdrawn.
On an appeal that is notified to the tribunal, the tribunal must determine whether it was just and reasonable for the officer to give the refusal notice.
The tribunal may affirm, vary or quash the notice.