INTM603735 | Transfer of assets abroad: 6 April 2025 non-UK domicile reforms: Benefits charge deductions allowed for previous settlement charge

As part of the changes introduced with effect from 6 April 2025 and the changes to the benefits charge a new section ITA07/S735AG has been introduced. This section applies if benefits are received in a tax year which are provided out of assets available for the purpose as a result of a transfer or one or more associated operations and income is treated by ITTOIA05/S643A (the settlements legislation) as arising to a person in that or any subsequent tax year by reference to the benefits provided.

In any subsequent tax year, the amount of the income treated as arising to an individual under ITA07/S732(2) is calculated under ITA07/S733(1) as if the total untaxed benefits were reduced by the amount of that income.

The reference to income treated as arising by ITTOIA05/S643A includes - in relation to any of the tax years 2018 - 2019 to 2024 - 2025 - any income treatedas arising by reference to the old onwards gifts provisions in the settlements code.