Income Tax Act 2007 section 809YA

Exception to section 809Y: proceeds taken offshore or invested

Section 809YA provides an exception to the rule that formerly exempt property sold in the UK is treated as a taxable remittance, provided the sale proceeds are either taken offshore or used to make a qualifying investment and six conditions are satisfied.

• Exempt property sold in the UK is not treated as a taxable remittance if the sale is a genuine arm's length transaction to a non-connected buyer and the seller retains no interest in the property after the sale
• All sale proceeds must be released by the final deadline (the first anniversary of 5 January following the tax year in which the property lost its exempt status) and must then be taken offshore or used to make a qualifying investment within 45 days of release
• Where proceeds are released within 45 days of the final deadline, they must be taken offshore or invested by the final deadline itself rather than benefiting from a further 45-day window
• The exception does not apply if the sale forms part of an arrangement whose main purpose, or one of whose main purposes, is the avoidance of tax