Income Tax Act 2007 section 809Y

Property that ceases to be exempt property treated as remitted

Section 809Y sets out the circumstances in which property that loses its exempt status is treated as having been remitted to the United Kingdom, and provides a potential relief where the property or its proceeds are used to make a qualifying business investment.

• When exempt property loses its exempt status — for example by being sold in the UK or by ceasing to meet the relevant exemption rules — it is treated as remitted to the UK at that point, triggering a potential tax charge
• Special protection applies where exempt property has been lost, stolen or destroyed: the normal triggers for loss of exemption do not apply during the period the property is missing, but a compensation payment received for such property is itself treated as a remittance
• Relief from the deemed remittance is available if, within 45 days of losing exempt status, the property or its proceeds are used by a relevant person to make a qualifying business investment, provided the remittance basis user claims relief by the first anniversary of the 31 January following the relevant tax year
• Where the business investment relief applies, the property continues to be treated as not remitted to the UK, and the business investment provisions govern the ongoing tax treatment of the income and gains concerned