Section 477 — Income Tax Act 2007: Sub-fund elections under Schedule 4ZA to TCGA 1992

Sub-fund elections under Schedule 4ZA to TCGA 1992 477 1 This section applies for the purposes of the Income Tax Acts (except so far as, in those Acts, the context otherwise requires) if the trustees of a settlement have made a sub-fund election under paragraph 1 of Schedule 4ZA to TCGA 1992.

2 The sub-fund settlement is treated as a settlement that is created at the relevant time.

3 Each trustee of the trusts on which property comprised in the sub-fund settlement is held is treated as a trustee of the sub-fund settlement.

4 A person (“T”) who is a trustee of the sub-fund settlement is treated, from the relevant time, as having ceased to be a trustee of the principal settlement unless T is also a trustee of trusts on which property comprised in the principal settlement is held.

5 A person (“T”) who is a trustee of the principal settlement is not to be treated as a trustee of the sub-fund settlement unless T is also a trustee of trusts on which property comprised in the sub-fund settlement is held.

6 The trustees of the sub-fund settlement are treated as having become, at the relevant time, absolutely entitled to the property comprised in that settlement as against the trustees of the principal settlement.

7 In this section— “ principal settlement ” has the meaning given by paragraph 1 of Schedule 4ZA to TCGA 1992, “ the relevant time ” means the time when the sub-fund election is treated as having taken effect under paragraph 2 of that Schedule, “ sub-fund election ” has the meaning given by paragraph 2 of that Schedule, and “ sub-fund settlement ” has the meaning given by paragraph 1 of that Schedule.