Income Tax Act 2007 section 504A

Treatment of capital expenditure of unauthorised unit trust

Section 504A provides the income tax treatment of capital expenditure incurred by UK-resident unauthorised unit trusts, ensuring that such expenditure is handled appropriately for income tax purposes.

• This section applies only to unauthorised unit trusts where the trustees are UK resident.
• It sets out how capital expenditure of the trust is to be treated for income tax purposes.
• The provision was introduced by the Income Tax Act 2007 (Amendment) Order 2009 and subsequently amended by the Unauthorised Unit Trusts (Tax) Regulations 2013.
• The rules are specific to unauthorised unit trusts, which are collective investment schemes that are not authorised by the Financial Conduct Authority and are therefore subject to different tax treatment from authorised unit trusts.