IFM02270 | Authorised investment funds (AIFs): taxation of funds: management expenses

As a company with investment business (sections 1218A and 1218B Corporation Tax Act 2009), an AIF may claim management expenses relief under section 1219 ibid.

Sums appropriated in accordance with the terms of the current prospectus of the AIF for payments to the authorised corporate director and depositary (of an OEIC) or the fund manager and trustee (of an AUT), that are paid by the AIF in respect of the management of the fund’s scheme property are treated as an expense of management.

In the rare event that an AIF derives some of its income from trading as well as from investments, it will generally be entitled to a deduction for the expenses of management, including the fund manager’s remuneration, but only to the extent that they are not otherwise deductible from trading profits.