Income Tax Act 2007 section 734A

Reduction in amount charged: previous settlements charge

Section 734A prevents the same benefit from being taxed twice — once under the transfer of assets abroad rules and again under the settlements legislation — by reducing the amount charged under the transfer of assets abroad provisions where a settlements charge has already arisen on the same benefit.

• Where a benefit is received as a result of a transfer of assets abroad and is also caught by the settlements rules, this section ensures the individual is not taxed twice on the same amount
• The section applies when income is treated as arising to a person under the settlements provisions (sections 643A, 643J or 643L of ITTOIA 2005) by reason of the same benefit that triggers a charge under the transfer of assets abroad rules (section 732 of ITA 2007)
• In tax years after the settlements income has been recognised, the amount charged under section 732 is reduced by deducting the settlements income from the total untaxed benefits used in the section 733 calculation
• The "total untaxed benefits" referred to in this section is the same figure as that used at Step 2 of the calculation in section 733(1), which determines how much income is treated as arising under the transfer of assets abroad provisions