RDRM35690 - Remittance basis: Mixed funds: Cleansing of mixed funds: Transfer made from a pre-2008 mixed fund before 6 April 2008

If there had been a transfer from the pre 2008 mixed fund to another overseas account before 6 April 2008 the individual needed to take the following steps.

Step 1

Calculate the total amounts of income and chargeable gains in the mixed fund immediately before the transfer took place.

Step 2

Once identified work out the proportion of income and gains contained within the account.

If the amount transferred is less than the total amount of income and gains contained in the account, the individual will treat that transfer as comprising of the proportions of income and gains contained within the account.

Example A

Brad has a pre-2008 mixed fund account. On 30 October 2007 a transfer of 拢100,000 was made from that account to another of Brad바카라 사이트檚 accounts.

Immediately before this transfer the account contained:

Capital 拢200,000

Income 拢300,000

Chargeable Gains 拢500,000

Totals 拢800,000

Proportionally this means:

Income is 37.5%

Gains are 62.5%

of the total income and gains held within the account.

Applying these proportions against the 拢100,000 transfer means that:

拢37,500 income, and

拢62,500 gains

were transferred from this account on 30 October 2007.

This leaves the balance remaining in the account of:

Capital 拢200,000

Income 拢262,500

Gains 拢437,500, after the transfer.

If Brad meets the qualifying individual and cleansing conditions, he can if he so wishes cleanse this account.

If the amount transferred from the account exceeded the total amount of income and gains, there would be no need for the individual to proceed further than step 1 바카라 사이트� the initial identification of the total amounts of income and gains contained within the account before the transfer took place.

So instead

Example B

The facts are identical to example A, but instead Brad makes a transfer from the account on the 30 October 2007 of 拢850,000.

The total amount of income and chargeable gains in the account immediately before the transfer was 拢800,000. The balance of 拢200,000 being capital. This means that Brad transferred all the income and gains plus 拢50,000 of his capital, leaving a balance of 拢150,000 capital.

As this account now only contains 1 source of funds- the 拢150,000 capital, there is no need for Brad to apply the cleansing provisions to it.