CTM40650 | Particular bodies: investment clubs

An investment club normally comprises a group of friends, neighbours or work colleagues who pool resources to buy and sell shares on the stock market. It will normally be an unincorporated association. As such, it falls within the definition of company for tax purposes at CTA10/S1121 (1).

However, investment clubs generally hold funds in a fiduciary capacity and consequently are outside the Corporation Tax charge, see CTA09/S3 (2). It follows that there is no need to set up a CT record or issue any CTSA returns in most cases. Individual members are instead charged to tax on their proportionate share of any income or chargeable gains and are entitled to relief in respect of their share of any capital losses.

There is more detailed guidance on investment clubs, and the procedures to be followed in respect of them, at CG20600 onwards.

(This content has been withheld because of exemptions in the Freedom of Information Act 2000).