IFM09240 - Eligibility criteria: Restriction condition: Introduction
The restriction condition is intended to ensure that the UK’s non-resident capital gains rules work effectively where UK property is held by a RIF.
A RIF, unlike most other types of UK or foreign collective investment vehicles, will never itself be chargeable to tax on gains on disposals of UK land. It is therefore important to have rules that effectively place any charge to tax, on gains related to UK land held by a RIF, on relevant investors in that RIF.
A co-ownership scheme will meet the condition where it meets one or more of 3 restriction conditions specified in Regulation 10:
- the non-UK property assets condition (IFM09245)
- the UK property rich condition (IFM09250)
- the exempt investor condition (IFM09255)
Where the scheme is an umbrella co-ownership scheme, each of its sub-schemes must meet at least one of the restriction conditions for the overall scheme to satisfy the restriction requirement (Regulation 42). (IFM09860)