Income Tax Act 2007 section 617

Income charged

Section 617 establishes how accrued income profits are charged to tax and determines the tax year in which those profits are treated as arising, depending on the circumstances of the securities transfer.

• Tax is charged on the full amount of accrued income profits for the tax year, subject to the remittance basis rules for foreign income.
• Where the settlement day falls within an interest period, the profits are taxed in the year in which that interest period ends.
• Where the settlement day falls after the securities' last interest period (for example, between the final interest payment and redemption), the profits are taxed in the year in which the settlement day itself falls.
• Where relief was previously claimed because transfer proceeds could not be remitted to the UK, the profits become taxable in the year the proceeds cease to be unremittable.