Income Tax Act 2007 section 646

Pension scheme trustees

Section 646 excludes pension scheme trustees from the accrued income scheme where the interest on the securities would be exempt from income tax under the registered pension scheme rules.

• Pension scheme trustees can be treated as both excluded transferors and excluded transferees under the accrued income scheme
• The exclusion applies where any interest arising on the securities would qualify for exemption under section 186 of the Finance Act 2004
• Section 186 of the Finance Act 2004 provides an income tax exemption for income from investments held for the purposes of a registered pension scheme
• The effect is that transfers of securities by or to pension scheme trustees are taken outside the accrued income scheme, so no accrued income charge or relief arises on such transfers