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HMRC have set out their views in relation to late applications for distributing fund status under TA 1988, Sch 27.
Paragraph 15 of Sch 27 requires the appropriate application for an account period to be made to the Revenue within six months of the end of the period.
HMRC now consider 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 its acceptance.
As to whether the taxman would accept applications where the fund could only meet the requirements for distributing fund status by making late distributions to its participators, para 1 requires that the appropriate level of distribution for a period must be made within six months of the end of that period.
An extension may be given in the following circumstances:
- where the shortfall is trivial;
- where the fund can show that the investor profile has remained constant both during and after the period of application; or
- 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 possible.
For further information, call Eric McLennan at the HMRC Collective Investment Schemes Centre: 0114 2969 443.
