Section 635 | Payment on transfer of variable rate securities

(1)In the case of a transfer of variable rate securities where the settlement day falls within an interest period, for the purposes of this Chapter a payment is treated as made to the transferor in that period.

(2)The amount of the payment is such amount as is just and reasonable.

(3)No one is treated as making the payment.

(4)Accordingly, the payment is not brought into account in determining whether the transferee is treated as making accrued income profits or losses under section 628.

(5)See section 630 for the rules that apply to transfers of variable rate securities where the settlement day falls outside an interest period.