Section 169VI | Disposals by trustees: relief reduced in certain cases ^F1

(1)Subsection (2) applies where—^F1

(a)a disposal falling within section 169VC(1)(a) and (b) is made by the trustees of a settlement,^F1

(b)section 169VC applies to the disposal by reason of there being at least one individual who is an eligible beneficiary in respect of the disposal (see section 169VH), and^F1

(c)at the time immediately before the disposal, there are two or more persons each of whom has under the settlement an interest in possession in the settled property.^F1

(2)In such a case the reference in section 169VC(2) to the relevant gain is to be read as a reference—^F1

(a)to the eligible beneficiary's share of the relevant gain (see subsections (3) to (6)), or^F1

(b)if there is more than one individual who is an eligible beneficiary in respect of the disposal, to so much of the relevant gain as is equal to the aggregate of the eligible beneficiaries' shares of that gain.^F1

(3)In this section—^F1

“eligible beneficiary” has the meaning given by section 169VH(2);

“relevant gain” has the meaning given by section 169VC(3);

“the settled property” means settled property that includes or consists of the holding of shares mentioned in section 169VC(1).

(4)Subsection (5) applies to determine for the purposes of this Chapter, in relation to any individual who is an eligible beneficiary in respect of a disposal within section 169VC(1) made by the trustees of a settlement, that individual's share of the relevant gain.^F1

(5)That individual's share of the relevant gain on the disposal is so much of the relevant gain on the disposal as bears to the whole of that gain the same proportion as X bears to Y, where—^F1

X is the interest in possession (other than for a fixed term) which, at the time immediately before the disposal, that individual has under the settlement in the income from the holding of shares mentioned in section 169VC(1), and

Y is all the interests in that income that persons (including that individual) with interests in possession in that holding have under the settlement at that time.