# Income Tax (Trading and Other Income) Act 2005, Paragraph 3: Consideration for right to sum of carried interest treated as “carried interest”


(1) Sub-paragraph (2) applies to consideration that is received or receivable—
(a) by an individual for the disposal, variation, loss or cancellation of the individual’s right to a sum arising from an investment scheme under arrangements by way of profit-related return, or
(b) by a person who is a relevant person in relation to the individual, for the disposal, variation, loss or cancellation of the relevant person’s right to a sum arising from an investment scheme under arrangements by way of profit-related return.
(2) The consideration, to the extent that it is not a disguised fee arising to the individual for the purposes of section 809EZA of ITA 2007—
(a) is to be treated as a sum which arises to the individual from the scheme under the arrangements by way of profit-related return at the time of the disposal, variation, loss or cancellation, and
(b) accordingly, is to be treated as constituting “carried interest”.
(3) For the purposes of sub-paragraph (1), a person is a “relevant person” in relation to an individual if carried interest arising to that person would be treated as arising to the individual for the purposes of section 23I (see paragraph 7 and paragraph 8 of this Schedule).

---
Source: https://www.legislation.gov.uk/ukpga/2005/5/schedule/A1/paragraph/3 (the official version)
Page: https://openlegislation.uk/income-tax-trading-and-other-income-act-2005/schedule-A1/paragraph-3
Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.