Offshore Funds - The Current Position
Article Abstract:
The Inland Revenue released for comment the draft clauses on offshore funds to introduce legislation to tax surplus proceeds arising on the realization of investments in offshore funds. These funds rolled up the income, instead of paying out regular dividends or interest to investors. Hence, when investments are sold, a part of the sale's proceeds is attributable to income earned on their investments. A non-qualifying off-shore fund is a fund which is not pursuing a full distribution policy. Full distribution means that the amount of the distribution should be at least 100 per cent of the income of the fund for that period and is not less than eighty-five per cent of the fund's United Kingdom equivalent profits for that period. Gains arising from the disposal of interests in off-shore funds are chargeable to tax under Case VI of Schedule D. Distributing funds are exempted from the new rules.
Publication Name: The Accountant
Subject: Business
ISSN: 0001-4710
Year: 1984
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The Revenue and Furnished Holiday Lettings
Article Abstract:
There is no consistency in the treatment applied to income and capital gains on furnished lettings. In some cases it is treated as Schedule D, Case I and allows claims for rollover relief and retirement relief on the property. In other cases it is treated as unearned income index Schedule A or Schedule D, Case VI and claims for CGT relief have not been admitted. After the decision in Gittos v. Barclay, Webb v. Conelee Properties and Griffiths v. Jackson, a legislation is proposed to assess income under Schedule A or Schedule D, Case VI as earned income. Letting activity is not treated as a trade in the proposed legislation although holiday lettings are treated as a trade for capital gains purposes.
Publication Name: The Accountant
Subject: Business
ISSN: 0001-4710
Year: 1984
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Furniss v. Dawson - The End of Avoidance Schemes
Article Abstract:
The House of Lords of the United Kingdom in its ruling against the taxpayer in Furniss versus Dawson, has wide-spread consequences. George Dawson and the two sons tried to avoid substantial capital gains tax liabilities upon selling their shares in two family companies by involving a third company in the transaction. The ruling determined that when looking at the end result, the involvement of the third company had no purpose save avoiding tax, therefore it could be disregarded. This casts doubt on business deals which the Inland Revenue has allowed before.
Publication Name: The Accountant
Subject: Business
ISSN: 0001-4710
Year: 1984
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