Office of Public Sector Information
69Z25.—(1) An open-ended investment company to which this Part applies must include documents A and B in its company tax return.
(2) Document A is a calculation of the net income of F(tax-exempt) and F(residual) in accordance with regulations 69Z1 to 69Z3.
(3) Document B is a reconciliation between—
(a) the net income of the company (see regulation 69Z), and
(b) the total income shown in the distribution accounts as attributed in accordance with regulation 69Z14.
(4) In paragraph (1) “company tax return” means the return required to be delivered pursuant to a notice under paragraph 3 of Schedule 18 to the Finance Act 1998(33), as read with paragraph 4 of that Schedule.
(5) Section 98 of TMA 1970(34) applies to any failure to furnish any information, give any certificate or produce any document or record in accordance with any provision of this Chapter as it applies to any such failure in the case of any provision specified in the second column of the Table below that section.
69Z26.—(1) This regulation applies if an open-ended investment company to which this Part applies—
(a) does not meet a condition set out in Chapter 2 of this Part (entry into and membership of the Property AIF regime), and
(b) becomes aware that it does not meet the condition.
(2) As soon as reasonably practicable, the company must provide the following information to the Commissioners—
(a) the date on which the condition first ceased to be met and the date (if any) on which the condition was satisfied again;
(b) details of the condition that was breached;
(c) the nature of the breach; and
(d) what (if anything) the company has done to prevent the breach recurring.
(3) This regulation does not apply if the breach of condition is one to which regulation 69Z27 applies.
69Z27.—(1) This regulation applies if an open-ended investment company to which this Part applies becomes aware that it has made a distribution to, or in respect of, a holder of excessive rights.
(2) As soon as reasonably practicable, the company must provide the following information to the Commissioners—
(a) the name of every person to whom, or in respect of whom, the distribution specified in paragraph (1) was made;
(b) the address of every such person;
(c) the amount or value of the distribution;
(d) particulars of those persons’ interests in the company, including details of the percentage of rights to the net asset value of the company represented by the shares held by those persons;
(e) the steps the company took to prevent the acquisition of any excessive holding; and
(f) the steps the company has taken, or is taking, to ensure that there is no longer any excessive holding in the company.
69Z28.—(1) This regulation applies if an officer of Revenue and Customs thinks that an open-ended investment company to which this Part applies—
(a) does not meet, or may not meet, a condition specified in Chapter 2 of this Part, or
(b) has not rectified a breach of such a condition.
(2) The officer may serve a notice on the manager of the company.
(3) The notice may require the manager to provide any of the information specified in regulation 69Z26(2) or, as the case may be, regulation 69Z27(2).
(4) The manager must comply with the notice within a period of 28 days beginning with the day on which the notice is served.
69Z29.—(1) This regulation applies if—
(a) an open-ended investment company to which this Part applies makes a distribution in an accounting period of the company, and
(b) the distribution includes sums attributed to property income distributions or to PAIF distributions (interest) (or to both) (referred to in this Chapter as a “relevant distribution”).
(2) The company must deliver a return to an officer of Revenue and Customs for each return period—
(a) which falls within the accounting period, and
(b) in which the company makes a relevant distribution.
(3) The return periods are—
(a) the quarters ending on 31st March, 30th June, 30th September and 31st December (the “quarter days”); and
(b) any shorter period which—
(i) starts on the first day of an accounting period and ends with the first or only quarter day in that accounting period;
(ii) begins immediately after the last or only quarter day in that accounting period and ends on the last day of that accounting period; or
(iii) is an accounting period which starts and ends within a quarter.
(4) The company must deliver the return during a period of 14 days beginning with the day immediately following the end of the return period.
(5) The return must show the amount of—
(a) any relevant distributions made by the company in the return period, and
(b) the tax (if any) payable by the company in respect of those payments.
(6) The company must deliver, with the return for the return period which ends on the last day of an accounting period, a reconciliation statement showing, in relation to any distribution made during the accounting period, the amounts (if any) which are attributable to each of paragraphs (a) to (c) of regulation 69Z14 (attribution of distributions).
69Z30.—(1) Tax in respect of a relevant distribution is due at the time by which the return on which the distribution must be included is required to be delivered.
(2) The tax due is equal to the sum which the company is required to deduct from the relevant distribution under—
(a) regulation 69Z22(1) (deduction of tax from property income distributions), and
(b) regulation 69Z23(1) (deduction of tax from PAIF distributions (interest)).
(3) The tax is due from the company making the relevant distribution.
(4) The tax is payable without an officer of Revenue and Customs making any assessment.
69Z31.—(1) This regulation applies if any tax in respect of a relevant distribution which is included in a return under this Chapter has not been paid at or before the time mentioned in regulation 69Z30.
(2) An officer of Revenue and Customs may make an assessment on the person who made the relevant distribution.
(3) Tax may be assessed under this regulation whether or not it has been paid when the assessment is made.
69Z32.—(1) This regulation applies if an officer of Revenue and Customs thinks—
(a) that there is a relevant distribution which should have been included in a return under this Chapter and which has not been so included, or
(b) that a return under this Chapter is otherwise incorrect.
(2) An officer of Revenue and Customs may make an assessment on the person who made the relevant distribution to the best of the officer’s judgement.
69Z33.—(1) The provisions of the Income Tax Acts about the time within which an assessment may be made apply to assessments under this Chapter, so far as those provisions refer or relate to—
(a) the tax year for which an assessment is made, or
(b) the year to which an assessment relates.
(2) Paragraph (1) applies despite the fact that an assessment under this Chapter may relate to a return period which is not a tax year.
(3) The provisions of section 36 of TMA 1970(35) (fraudulent or negligent conduct) about the circumstances in which an assessment may be made out of time apply accordingly on the basis that any such assessment relates to the tax year in which the return period ends.
(4) Section 87 of TMA 1970(36) (interest on overdue income tax deducted at source) applies for the purposes of a payment due under regulation 69Z30 or an assessment made under regulation 69Z31 or 69Z32.
69Z34.—(1) A company making a relevant distribution which is subject to deduction of tax by virtue of regulation 69Z22(1) must furnish the recipient with a statement in writing showing—
(a) the gross amount of the payment,
(b) the amount of tax deducted, and
(c) the actual amount paid.
(2) The duty imposed by subsection (1) is enforceable at the suit or instance of the recipient.
69Z35.—(1) This regulation applies if an open-ended investment company to which this Part applies makes a distribution, and then becomes aware that—
(a) anything which should have been included in a return delivered by the company under these Regulations has not been so included,
(b) anything which should not have been included in a return delivered by the company under these Regulations has been so included, or
(c) any other error has occurred in a return delivered by the company under these Regulations.
(2) The company must deliver an amended return correcting the error to an officer of Revenue and Customs without delay.
(3) If the company delivers an amended return such assessments, adjustments, setoffs or payments or repayments of tax as are necessary for achieving the objective mentioned in paragraph (4) must be made.
(4) The objective is that the resulting liabilities to income and corporation tax (including interest on unpaid or overpaid tax) of the company or any other person are the same as they would have been if a correct return had been delivered.
69Z36.—(1) This regulation applies if an open-ended investment company to which this Part applies gives a notice under this regulation specifying a date at the end of which this Part is to cease to apply to the company.
(2) This Part shall cease to apply to the company at the end of that date.
(3) A notice under paragraph (1) must be given in writing to the Commissioners.
(4) The date specified under paragraph (1) must be after the date on which the Commissioners receive the notice.
69Z37.—(1) This regulation applies if the Commissioners give a notice in writing under this paragraph to an open-ended investment company to which this Part applies (a “termination notice”).
(2) This Part shall cease to apply to the company.
(3) The Commissioners may give a termination notice only if—
(a) a provision contained in this Part provides that the Commissioners may give a termination notice,
(b) there is an intentional or negligent breach of a condition in Chapter 2, or
(c) there is an attempt to gain a tax advantage to which regulation 69Z10 applies.
(4) A termination notice must state the reason for it.
(5) If a termination notice is given to an open-ended investment company, this Part shall be taken to have ceased to apply to the open-ended investment company at the end of the accounting period before the accounting period during which the event occurs (or the last event occurs) which caused the Commissioners to give the notice.
69Z38.—(1) An open-ended investment company to which a termination notice is given may appeal to the Special Commissioners.
(2) The notice of appeal must be given to HM Revenue and Customs within a period of 28 days beginning with the day on which the termination notice is given.
(3) On an appeal the Special Commissioners shall determine whether it was just and reasonable for HM Revenue and Customs to give the termination notice.
(4) If they decide that it was, they must confirm the notice.
(5) If they decide that it was not, they must set aside the notice.
69Z39.—(1) This regulation applies if an open-ended investment company to which this Part applies—
(a) ceases to be authorised by the Financial Services Authority,
(b) ceases to be an open-ended investment company, or
(c) ceases to carry on property investment business.
(2) This Part shall cease to apply to the company at the end of the date on which the company ceases to be authorised by the Financial Services Authority, to be an open-ended investment company, or to carry on property investment business (as the case may be).
69Z40.—(1) This regulation applies if an open-ended investment company to which this Part applies—
(a) is party to a merger or takeover, and
(b) as a result, ceases to meet one or more of the conditions for this Part to apply.
(2) On the occurrence of the merger or takeover—
(a) an accounting period of the company shall end at the end of the date of the merger or takeover, and
(b) this Part shall cease to apply to the company at the end of that date.
69Z41.—(1) The business of F (tax-exempt) shall be treated for the purposes of corporation tax as ceasing immediately before cessation.
(2) Assets which immediately before cessation are involved in the business of F (tax-exempt) shall be treated for the purposes of corporation tax as being sold by F (tax-exempt) immediately before cessation and reacquired immediately after cessation by F (post-cessation).
(3) For the purposes of corporation tax, on cessation one accounting period of F (residual) shall end and an accounting period of F (post-cessation) shall begin.
(4) The sale and reacquisition deemed under paragraph (2) shall not have effect for the purposes of tax in respect of chargeable gains.
(5) For the purposes of CAA 2001, the sale and re-acquisition deemed under paragraph (2)—
(a) shall not give rise to allowances or charges, and
(b) shall not make it possible to make an election under section 198 or 199 of that Act (apportionment).
(6) For the purposes of CAA 2001, anything done by or to F (tax-exempt) before cessation in relation to an asset which is deemed under paragraph (2) to be sold and re-acquired shall be treated after cessation as having been done by or to F (post-cessation).”.
6. In Part 1 of the Schedule (abbreviations of Acts) insert at the appropriate place—
| FA 1993 | The Finance Act 1993 (c. 34) |
| FA 1994 | The Finance Act 1994 (c. 9) |
| FA 2006 | The Finance Act 2006 (c. 25) |
| ITA 2007 | The Income Tax Act 2007 (c. 3) |
7. In Part 2 of the Schedule (index of defined expressions) insert at the appropriate place—
| Applicant (in Part 4A) | Regulation 69O(6) |
| Balance of business conditions (in Part 4A) | Regulation 69N |
| Body corporate (in Part 4A) | Regulation 69L(6) |
| Cessation (in Part 4A) | Regulation 69C(2) |
| Corporate ownership condition (in Part 4A) | Regulation 69K |
| Entry (in Part 4A) | Regulation 69C(1) |
| Excessive holding (in Part 4A) | Regulation 69Z13(3) |
| Existing company notice (in Part 4A) | Regulation 69O(6) |
| Future company notice (in Part 4A) | Regulation 69O(6) |
| F (post-cessation) (in Part 4A) | Regulation 69C(3)(d) |
| F (pre-entry) (in Part 4A) | Regulation 69C(3)(a) |
| F (residual) (in Part 4A) | Regulation 69C(3)(c) |
| F (tax-exempt) (in Part 4A) | Regulation 69C(3)(b) |
| Genuine diversity of ownership condition (in Part 4A) | Regulation 69J |
| Holder of excessive rights (in Part 4A) | Regulation 69Z13 |
| Loan creditor condition (in Part 4A) | Regulation 69M |
| Net income (in Part 4A) | Regulation 69Z |
| Net income of F (residual) (in Part 4A) | Regulation 69Z2 |
| Net income of F (tax-exempt) (in Part 4A) | Regulation 69Z1 |
| Newly qualified company (in Part 4A) | Regulation 69N(5) |
| PAIF distribution (dividends) (in Part 4A) | Regulation 69Z17(3) |
| PAIF distribution (interest) (in Part 4A) | Regulation 69Z16(3) |
| Pre-distribution amount (in Part 4A) | Regulation 69Z3 |
| Property AIF | Regulation 69A(2) |
| Property income distribution | Regulation 69Z15(4) |
| Property investment business (in Part 4A) | Regulation 69F(1) |
| Property rental business (in Part 4A) | Regulation 69H(1) |
| Prospectus (in Part 4A) | Regulation 69E(4) |
| Relevant distribution (in Chapter 6 of Part 4A) | Regulation 69Z29(1)(b) |
| Specified accounting period (in Part 4A) | Regulation 69Q(2) |
| Termination notice (in Part 4A) | Regulation 69Z37(1) |
| UK-REIT | Regulation 69F(2). |
Alan Campbell
Dave Watts
Two of the Lords Commissioners of Her Majesty’s Treasury
12th March 2008
1970 c. 9; section 98 was relevantly amended by section 164 of the Finance Act 1989 (c. 26) and section 68(3) of the Finance Act 1990 (c.29). Back [34]
Section 36 was substituted by section 149(1) of the Finance Act 1989 (c. 26), and amended by paragraph 4(1) of Schedule 11 to the Finance Act 1990 (c. 29), paragraph 9(2) of Schedule 5 to the Finance (No. 2) Act 1992 (c. 48), paragraph 11 of Schedule 19 to the Finance Act 1994 (c. 9), paragraph 18 of Schedule 19 to the Finance Act 1998 (c. 36), Schedule 6 to the Tax Credits Act 2002 (c. 21) and paragraph 251 of Schedule 1 to the Income Tax Act 2007 (c. 3). Back [35]
Section 87 was substituted by paragraph 258 of Schedule 1 to the Income Tax Act 2007. Back [36]
The Authorised Investment Funds (Tax) (Amendment) Regulations 2008