Form

Alternative Investment Fund Managers: Deferral and Vesting Form for Restricted Profits - box by box guidance

Published 29 January 2015

Restricted profits allocated to AIFM Partner

This section of the form captures amounts of relevant restricted profit which have been allocated to the Alternative Investment Fund Manager (AIFM) Partner in the year.

Box 1: Restricted profit allocated to AIFM Partner

This box is to record the total relevant restricted profits allocated by the individual member to the AIFM Partner in the period. This includes both cash and instruments, and these are broken down separately in boxes 5 and 6.

Calculated as : box 1 = box 5 + box 6

For cash, only amounts which are deferred (payable in later years) can be allocated to the AIFM Partner; but for instruments, amounts which are payable up front - but must be held by the individual for at least 6 months - may also be included in the mechanism.

The total of all individual members should correspond with what has been detailed on the AIFMs partners self-assessment return.

Box 2: Tax payable by AIFM Partner

This box is to record the tax payable by the AIFM Partner. It is calculated at the additional rate, of 45%. No reliefs are available against these profits.

Box 3: Tax paid by AIFM Partner

This box is to record the tax actually paid by the AIFM Partner for the relevant accounting period end (APE).

Box 4: Net Amount

This box is to record the net amount received by the AIFM Partner after deduction of tax.

Calculated as: box 4 = box 1 - box 2

Boxes 5 and 6: Cash and Instruments

These boxes are to record the respective allocated profits which are cash and instruments. They should add to give the figure in box 1.

Calculated as: box 5 + box 6 = box 1

Restricted Profits vested: Cash

Each original APE tranche of profits due to vest should be recorded on a separate line, with the amounts vesting and being forfeited broken down between box 12 and box 15. In the first year of use of the mechanism there may only be one tranche, but in later years there may be profits deferred from various years.

Box 7: Originating APE

This box is to record the accounting period from which the currently vesting profits were deferred.

Box 8: Date vested

This box is to record the date of vesting of the profits. Where profits originating from different periods vest on the same date, please use a separate line for each tranche.

Box 9: Amount due to vest

This box is to record the total amount originally allocated to the AIFM Partner which was due to vest in the current accounting period. This will include amounts which did not vest.

Box 10: Tax payable by AIFM Partner

This box is to record the tax liability of the AIFM Partner on the profits allocated. Tax is payable at the additional rate of 45%.

Box 11: Tax paid by the AIFM Partner

This box is to record the tax actually paid by the AIFM Partner to HM Revenue and Customs (HMRC).

Box 12: Net amount vested

This box is to record the net amount (gross less tax credit) vesting in the individual partner in the year.

Box 13: Credit for tax paid

This box is to record the amount of tax credit due on the amount vesting in the individual member in the year. It should not exceed the figure in box 11. The aggregate of these tax credits should be entered by the individual member in their self-assessment return.

Box 14: Gross amount

This box is to record the gross amount vesting in the year.

Box 15: Net amount forfeited

This box is to record the net amount of allocated profits due to vest but not vesting (which are forfeited) in the year.

This should equal:
box 15 = box 9 - box 10 - box 12

Restricted Profits Vested: Instruments

As for cash, each original APEs tranche of profits due to vest should be recorded on a separate line. Unlike cash, for instruments there may be both a deferral and a vesting event in the same year (where instruments paid up front but required to be held for at least 6 months are sold during the year).

Box 16: Originating APE

This box is to record the accounting period from which the currently vesting profits were deferred.

Box 17: Date vested

This box is to record the date of vesting of the profits.

Box 18: Amount due to vest

This box is to record the total amount originally allocated to the AIFM Partner which was due to vest in the current accounting period. This will include amounts which did not vest.

Box 19: Tax payable by AIFM Partner

This box is to record the tax liability of the AIFM Partner on the profits allocated. Tax is payable at the additional rate of 45%.

Box 20: Tax Paid by AIFM Partner

This box is to record the tax actually paid by the AIFM Partner to HMRC.

Box 21: Net amount vested

This box is to record the net amount (gross less tax credit) vesting in the individual member in the year.

Box 22: Total number

This box is to record the total number of instruments vested in the year.

Box 23: Name of instruments

This box is to record the name of the instrument. There is no prescribed format for the description.

Box 24: Credit for tax paid

This box is to record the amount of tax credit due on the amount vesting in the individual member in the year. It should not exceed the figure in box 20. The aggregate of these tax credits should be entered by the individual member in their self-assessment return.

Box 25: Net amount forfeited

This box is to record the net amount of allocated profits due to vest but not vesting (which are forfeited) in the year.