Income Tax (Trading and Other Income) Act 2005 section 468

Non-UK resident trustees and foreign institutions

Section 468 deals with how gains from life insurance contracts and similar policies are brought into the UK tax net when the rights are held by non-UK resident trustees or by foreign institutions, by applying the transfer of assets abroad anti-avoidance rules.

• Where non-UK resident trustees hold policy rights and would have been liable under section 467 had they been UK resident, or where a foreign institution owns, holds, or uses the rights as debt security, the transfer of assets abroad rules in Chapter 2 of Part 13 of ITA 2007 are engaged
• For non-UK resident trustees, the gain is treated as income payable to the trustees arising in the tax year in which the gain arises; for foreign institutions, the gain is similarly treated as income payable to, and arising to, the institution in that same tax year
• A "foreign institution" means any company or other institution that is resident or domiciled outside the United Kingdom, and where only a part or share in the policy rights has been surrendered or assigned, references to those rights apply only to that part or share
• This section does not apply if someone is already liable in respect of the gain under the temporary non-residence rules in section 465B