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HMRC internal manual

Capital Gains Manual

Non-resident companies: basic conditions for TCGA92/S13: beneficiaries: TCGA92/S13(4)

Where the trustees of a settlement, whether resident in the UK or not, are participators in a non-resident company then in certain circumstances a beneficiary of the settlement will also be within the definition of participator. The effect of section 13(14) is that once you reach shares or other interests held by trustees, except in the case of a bare trust, see CG34300, you stop there. In deciding how the chargeable gain of the company should be apportioned, you treat the trustees as if they were the beneficial owners of their shares or other interests and apportion the gain to them as appropriate, ignoring the interests of the beneficiaries. If the trustees are resident then their share of the gain is assessed on them, or on the settlor under TCGA92/S77 in relevant cases. If the trustees are non-resident then the gain is subject to TCGA92/S86 and TCGA92/S87, see CG57395. Any interest as a participator in the non- resident company which the beneficiary holds in their own right, for example by a personal holding of shares in the non-resident company, will remain within Section 13.