INTM600420 - Transfer of assets abroad: General conditions: Becomes payable
Whether there is income that becomes payable as a result of a relevant transaction is essentially a matter to be discerned from the facts.
In some circumstances the situation may be quite clear. For example, cash is transferred into an offshore company and then placed on deposit with interest being credited to the account in the company name. The interest credited to the account is clearly income that becomes payable.
For income tax purposes, if the interest accrued to the company it would not normally be considered to be income until it was paid or credited to the company (but see accrued income scheme charges 바카라 사이트� INTM601180). Apart from situations where the accrued income scheme applies, an accrual is unlikely, in most cases, to be income that becomes payable.
In the first scenario above, the company had become entitled to income when the interest was credited to its account; in the second scenario where interest accrued, no entitlement had arisen.
Being entitled to receive income will usually be considered as income that becomes payable for the purpose of this provision. For example, in Latilla v CIR (25 TC 107) a foreign company was entitled under a partnership agreement to a share of partnership profits and that entitlement was held to be income payable to the company. In commenting on 바카라 사이트榩ayable바카라 사이트� Lord Porter said 바카라 사이트渋t was not a term of art바카라 사이트�, and 바카라 사이트渉e has at his disposal the means whereby he can ensure that his share reaches his hands바카라 사이트� and that 바카라 사이트渋n the circumstances it seems to me that the term accurately conveys the process by which income finds its way into the pocket of the individual바카라 사이트�.
The finding of Hoffmann J in CIR v Brackett (60 TC 134) carries this interpretation further to embrace 바카라 사이트渘ot only the case in which the payment to the non-resident has in itself the quality of income but also the case of payments to a non-resident trader from which, after deduction of expenses, the income will arise바카라 사이트�.
Entitlement to trading receipts can therefore be taken to be an indication that income becomes payable, subject to the calculation of trading profits after the end of the accounting period.
Apart from where a specific provision regards an item as income that becomes payable to a person abroad (see INTM600400), the transfer of assets provisions in general will only apply to real income of the person abroad rather than 바카라 사이트榙eemed바카라 사이트� income. This is because it seems likely that only actual income could 바카라 사이트榖ecome payable바카라 사이트� to a person abroad.
More details on how to calculate the income tax charge and what deductions are allowable can be found at INTM601100.