Section 956 — Corporation Tax Act 2009: Payments in respect of limited interests followed by absolute interests

Payments in respect of limited interests followed by absolute interests 956 1 This section applies if—

a two or more interests in the whole or part of the residue of an estate are held successively during the administration period by different persons, b each later interest arises or is created on the cessation of the previous interest otherwise than by death, c at least one of the interests is an absolute interest, and d at least one of the interests preceding that interest is a limited interest.

2 A sum to which a company (“C”) with such an absolute interest is entitled in respect of any such limited interest which is paid while C has the absolute interest is treated as paid in respect of the absolute interest (and not the limited interest).

3 Subsection (4) applies if—

a C's absolute interest ceases during the administration period, and b a sum to which C is entitled in respect of any such limited interest—

i is paid after the absolute interest ceases but before the end of the administration period, or ii remains payable at the end of it.

4 This Chapter applies as respects any such sum as if the limited interest had continued to subsist while that absolute interest subsisted and had been held by C.

5 Subsection (4) is subject to subsection (6).

6 For the purposes only of section 951 (reduction in share of residuary income of estate), any such sum is treated as paid or payable in respect of the absolute interest.