Income Tax Act 2007 Schedule 2 paragraph 140

Transfers of assets abroad: income arising before 26 November 1996

Paragraph 140 of Schedule 2 provides a transitional rule that disapplies certain provisions of the transfer of assets abroad rules where the relevant income arose before 26 November 1996.

• This paragraph concerns the transfer of assets abroad anti-avoidance rules in sections 721 and 728 of the Income Tax Act 2007.
• Specific subsections of section 721 (dealing with individuals who have the power to enjoy income from relevant transactions) and section 728 (dealing with individuals receiving capital sums from relevant transactions) are switched off for pre-26 November 1996 income.
• The disapplied provisions are section 721(5)(b) and (c) and section 728(3)(b) and (c).
• This transitional rule preserves the tax treatment that applied before these particular subsections were introduced, protecting taxpayers from retrospective application.