IFM41060 | Remittance basis: interaction with mixed fund rules

As a QAHC can have both UK and foreign situs investment assets, it is possible that a payment to an individual who provides investment management services receives from a QAHC may consist of UK and foreign income, gains, or capital.

Payments that a QAHC makes to such an individual that consist of UK and foreign income or gains will be a mixed fund. The mixed fund ordering rules (RDRM35240) should be applied to any transfers from a mixed fund to establish the nature of any remittances to the UK.

Where the individual receives income or gain from a QAHC that are treated as foreign income or gain a mixed fund will not be created if the QAHC:

• makes a separate payment of the income or gain that is treated as foreign, and

• the foreign income or gain is paid into a separate account

However, if the foreign income or gain is paid into an account that already holds capital, income or gains, the funds in the account will be a mixed fund (RDRM35210)