INTM603620 - Transfer of assets abroad: Non-domiciled and deemed domiciled settlors from 6 April 2017: Valuation of benefits - introduction

It can be seen in INTM601400 onwards (covering the basics of the benefits charge) that the legislation was silent on how the value of a benefit should be calculated.

With the expansion of the benefits charge due to the changes introduced with the concept of UK deemed domicile, it was considered that a more formal approach was needed to the valuation of benefits for the purposes of the transfer of assets abroad legislation. Therefore, Schedule 14 of Finance (No. 2) Act 2017 introduced ITA07/S742B to S742E to set out how certain benefits were to be calculated.

The legislation provides rules for calculating the value of a benefit provided in relation to the following and each will be looked at in turn in these pages of guidance:

INTM603640 - A payment by way of a loan (ITA07/S742C)

INTM603660 - The making available of movable property without any transfer of ownership of the property (ITA07/S742D)

INTM603680 - The making available of land without any transfer of the ownership of the land concerned (ITA07/S742E).

Note

Although these valuation rules for certain benefits were included as part of the deemed domicile package of changes to the transfer of assets abroad legislation, the rules apply to the valuation of these benefits in all scenarios with effect from 6 April 2017. These rule changes are not restricted to the valuation of benefits arising in protected settlements only.

It should also be noted that the same valuation rules apply with effect from 6 April 2017 for the purposes of TCGA92/S87 for CGT (see CG38625 onwards).