Late applications for distributing fund status
Clarification on late applications for distributing fund status under Schedule 27 ICTA 1988.
HM Revenue and Customs (HMRC) has been asked to set out its views in relation to late applications for distributing fund status under Schedule 27 ICTA 1988.
Paragraph 15 Schedule 27 ICTA 1988 requires the appropriate application for an account period to be made to HMRC within 6 months of the end of the period or at such later time as the Board of HMRC may allow. HMRC now considers that, provided all other conditions for approval have been met for an account period, the lateness of an application alone will not be a bar to the acceptance of the application.
The question has also been posed as to whether HMRC would accept applications where the fund could only meet the requirements for distributing fund status by making late distributions to its participators. Paragraph 1 Schedule 27 ICTA 1988 requires that the appropriate level of distribution for a period must be made within 6 months of the end of that period or within such longer time as the Board of HMRC may allow. Generally, the Board of HMRC will only allow additional time for the payment of late distributions in the following circumstances:
- Where the shortfall is trivial.
- Where the fund can show that the investor profile has remained constant for the period of application and subsequently.
- Where the fund had a reasonable excuse for not making the distribution within the appropriate time and it then made the distribution as soon as it was able.
Any further questions on this issue can be addressed to HMRC Collective Investment Schemes Centre by contacting:
- Eric McLennan tel. 0114 2969 443
- Andrew Marshall tel. 0114 2969 361