Chapter IFM06610

Published date05 July 2019
Record NumberIFM06610
Termination notice issued by the tax elected fund (TEF)

Where the manager of a TEF wishes to take an authorised investment fund out of the TEF regime, then under regulation 69Z70 of SI2006/964 they must give HMRC a written notice specifying the final day on which the TEF regime will apply. That day must be the final day of an accounting period and a day after the date on which HMRC receives the notice. The notice must specify the reasons for leaving the regime. IFM06620 outlines the effect of such a notice.

Termination notice issued by HMRC

As set out at IFM06500 onwards, HMRC may issue a termination notice to the manager of the TEF under regulation 69Z71 of SI2006/964. The effect of that notice will be that the TEF will be taken to have ceased to be within the regime at the end of the accounting period immediately preceding the accounting period in which the notice was given.

Tax treatment of investors where a notice has been issued

The tax treatment of investors that receive distributions made before a termination notice is issued will not be affected by the issue of a termination notice.

Appeal against termination notice

Where the manager of a fund receives a termination notice from HMRC then under regulation 69Z72 of SI 2006/964 they may appeal against the notice to the First-tier Tribunal. The tribunal will determine whether the issue of the...

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