Income Tax Act 2007 Schedule 2 paragraphs 134–135

Transfers of assets abroad: whether trustees are "persons abroad"

Schedule 2 paragraphs 134–135 set out transitional rules governing whether the normal trust residence rules apply when deciding if trustees count as "persons abroad" for the transfer of assets abroad anti-avoidance provisions.

• The standard rules for determining trustee residence do not apply to income payable, or benefits received, before 15 June 1989 when assessing charges on capital sums or benefits arising from transfers of assets abroad.
• Even for income payable on or after 15 June 1989, the trustee residence rules are disapplied where the individual received the capital sum before that date and it was fully repaid or waived before 1 October 1989.
• When calculating the amount of income treated as arising in respect of benefits received on or after 15 June 1989, any income that arose to trustees before 6 April 1989 is treated as income of persons abroad if at least one trustee was resident outside the United Kingdom — regardless of whether other trustees were UK-resident.
• However, if the trustees have already been charged to tax on that pre-6 April 1989 income, it is not treated as income of persons abroad.