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HMRC internal manual

Company Taxation Manual

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Authorised investment funds: collective investment schemes: general: unauthorised unit trusts

Meaning of unauthorised unit trust – section 469 ICTA 1988

An unauthorised unit trust (UUT) is a unit trust scheme that is not an authorised unittrust (CTM48120) and where the trustees are not resident outside the UK.

A UUT is not within the CT regime that exists for authorised unit trusts.

The income of a UUT is treated as the income of the trustees (ICTA88/S469 (2)) and ischarged to IT at the basic rate.

The unit holders are then treated as receiving annual payments in proportion to their rights and made by the trustees after deduction of basic rate IT.

For details of the tax treatment of the trustees of a UUT, and of the unit holders as wellas for exceptions to the general rule, see IM4176 onwards.