Income Tax Act 2007 section 666

Certain transfers by or to nominees or trustees treated as made by or to others

Section 666 ensures that when securities are transferred through nominees or trustees, the accrued income scheme charges fall on the true beneficial owner rather than the intermediary.

• Where securities are held through a nominee, any transfer by or to the nominee is treated as a transfer by or to the person the nominee acts for, so the accrued income charge falls on the principal rather than the nominee.
• Where securities are held on trust and the beneficiary is absolutely entitled — meaning they have the exclusive right to direct how the securities are dealt with — transfers by or to the trustee are treated as transfers by or to that beneficiary.
• A beneficiary's right to direct dealings in the securities is still regarded as exclusive even if it is subject to the trustee's right to use the securities to meet outstanding charges, liens, taxes, costs or other outgoings.
• The same rules apply where two or more persons are the beneficial owners: nominee transfers are attributed to all those persons, and trustee transfers are attributed to them provided they are jointly absolutely entitled against the trustee.