[F1Participant’s power to elect for deemed disposalU.K.
85Z11.—(1) Notwithstanding an election made under regulation 85Z9, this Part continues to apply to a participant in a FINROF unless the participant makes an election in accordance with paragraph (2).
(2) A participant in the fund may make an election to be treated—
(a)as disposing of the units owned by the participant in the FINROF at their market value on the deemed disposal date, and
(b)as acquiring units in the authorised investment fund on the deemed disposal date.
(3) The income gain arising on the deemed disposal referred to in paragraph (2)(a) shall be determined in accordance with Chapter 6 of this Part.
(4) The acquisition referred to in paragraph (2)(b) is treated as made for a consideration equal to the consideration for the disposal referred to in paragraph (2)(a).
(5) An election may not be made under paragraph (2) unless the income gain arising on the disposal referred to in paragraph (2)(a) (determined in accordance with Chapter 6 of this Part) is greater than zero.
(6) If the participant is chargeable to income tax, the election mentioned in paragraph (2) must be made by being included in a return made for the tax year which includes the deemed disposal date.
(7) If the participant is chargeable to corporation tax, the election mentioned in paragraph (2) must be made by being included in the participant’s company tax return for the accounting period which includes the deemed disposal date.
(8) In this regulation—
“company tax return” has the same meaning as in Schedule 18 to the Finance Act 1998; and
the “deemed disposal date” means the date on which, in accordance with regulation 85Z9, the fund ceases to be a FINROF.]
Textual Amendments
F1Pt. 6A inserted (with effect in accordance with reg. 1(2) of the amending S.I.) by The Authorised Investment Funds (Tax) (Amendment) Regulations 2010 (S.I. 2010/294), regs. 1(1), 21 (with regs. 25, 26)