Taxation of Chargeable Gains Act 1992 Schedule 4C paragraph 1

Introduction

Schedule 4C paragraph 1 introduces the concept of the "Schedule 4C pool" and explains how it applies when trustees of a non-resident settlement make a transfer of value involving trust borrowing under Schedule 4B.

• Schedule 4C replaces the usual section 87 mechanism for matching capital payments to trustee gains whenever trustees have made a transfer of value to which Schedule 4B applies, and it only applies to non-resident (or formerly non-resident) settlements.
• When trustees of a settlement (the "transferor settlement") make a qualifying transfer of value (the "original transfer"), the settlement is treated as having a "Schedule 4C pool" containing the outstanding chargeable gains (net of allowable losses) at the end of the tax year of the original transfer.
• The pool amount for that tax year is increased by the Schedule 4B trust gains arising from the original transfer and by any additional Schedule 4B trust gains from further qualifying transfers of value made by the trustees in the same tax year.
• A transfer to which Schedule 4B applies is included regardless of whether any chargeable gain or allowable loss actually accrues as a result of that transfer.