Taxation of Chargeable Gains Act 1992 section 3C

Prevention of double UK taxation

Section 3C provides relief from double taxation where a person has already been taxed on a gain attributed to them under the non-UK resident close company rules, and a distribution is subsequently made in respect of that same gain.

• Where tax has been paid on an attributed gain under section 3 and a distribution relating to that gain is made within the relevant period, the tax already paid reduces or eliminates any further tax liability on that distribution
• The relevant period is three years from the end of the earlier of the company's accounting period in which the gain accrued or the 12-month period beginning on the date the gain accrued
• Tax paid under section 3 can also be deducted when calculating any chargeable gain on a disposal of the person's interest as a participator in the company
• The relief can only be used once and is not available if the company reimburses the person for the tax paid