Section 174 Premium trust funds.F4

United Kingdom

F1(1)

For the purposes of the Income Tax Acts and the Gains Tax Acts—

(a)

a member shall be treated as absolutely entitled as against the trustees to the assets forming part of a F2premium trust fund of his; and

(b)

where a deposit required by a regulatory authority in a country or territory outside the United Kingdom is paid out of such a fund, the money so paid shall be treated as still forming part of that fund.

(2)

Where an asset forms part of a premium trust fund at the beginning of any underwriting year, for the purposes of the Income Tax Acts—

(a)

the trustees of the fund shall be treated as acquiring it on that day, and

(b)

they shall be treated as paying in respect of the acquisition an amount equal to the value of the asset at the time of the acquisition.

(3)

Where an asset forms part of a premium trust fund at the end of any underwriting year, for the purposes of the Income Tax Acts—

(a)

the trustees of the fund shall be treated as disposing of it on that day, and

(b)

they shall be treated as obtaining in respect of the disposal an amount equal to the value of the asset at the time of the disposal.

F3(4)

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(5)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(6)

Subsections (2) to (5) above do not apply to FOTRA securities forming part of a member’s premiums trust fund at the beginning or end of any underwriting year if—

(a)

the member is not domiciled in the United Kingdom at any time in the year, and

(b)

he is either not ordinarily resident in the United Kingdom during the year or a non-resident United Kingdom trader in the year.

(7)

In this section—

“FOTRA securities” has the same meaning as in section 715 of the Taxes Act 1988 (exceptions from accrued income scheme);
“non-resident United Kingdom trader” shall be construed in accordance with subsection (5) of that section;
“underwriting year” does not include the year 1993 or any earlier underwriting year.

Annotations

Textual amendments

F1: S. 174(1) substituted (3.5.1994 with effect for the year 1994-95 and subsequent years of assessment) by 1994 c. 9, s. 228, Sch. 21 para. 3
F2: Word in s. 174(1)(a)(2)(3) substituted (1.12.2001) by S.I. 2001/3629, arts. 1(2), 82(c)
F3: S. 174(4)(5) repealed (19.3.1997 with effect in relation to, and to transfers under, any arrangement made on or after such day as may be appointed by order) by 1997 c. 16, ss. 76, 113, Sch. 10 Pt. I paras. 6(a), 7(1), Sch. 18 Pt. VI(10) Note 1
F4: S. 174: words in sidenote substituted (1.12.2001) by S.I. 2001/3629, arts. 1(2), 82(c)

Notes on Chapter III

Modifications

C1: Pt. II Chapter III applied (1.5.1995 with application as mentioned in s. 127(19) of the amending Act) by 1995 c. 4, s. 127(16)(a)(19)
C2: Pt. II Chapter III modified (1.12.1997 with effect with respect to accounting periods of Lloyd's Scottish limited partnerships ending on or after that date) by S.I. 1997/2681, reg. 3(1)(a)