HM 1Outline of subpart and relationship with other Parts

1. This subpart sets out—

2. the entry and exit rules for portfolio investment entities, see sections HM 7 to HM 30:
3. who an investor is, and what an investor class is, see sections HM 4 and HM 5:
4. what a multi-rate PIE must do in relation to its investors and its investments, see sections HM 31 to HM 63:
5. the treatment of losses by PIEs, see sections HM 64 to HM 70:
6. how an entity makes an election to become a PIE, and the consequences of making the election, see sections HM 71 to HM 76.

7. The following sections apply to portfolio investment entities:

8. section CB 26 (Disposal of certain shares by portfolio investment entities):
9. section CP 1 (Attributed income of investors in multi-rate PIEs):
10. section CX 55 (Proceeds from disposal of investment shares):
11. section CX 56 (Attributed income of certain investors in multi-rate PIEs):
12. section CX 56B (Distributions to investors in multi-rate PIEs):
13. section CX 56C (Distributions to investors by listed PIEs):
14. section CX 57 (Credits for investment fees):
15. section DB 53 (Attributed PIE losses of certain investors):
16. section DB 54 (No deductions for fees relating to interests in multi-rate PIEs):
17. section DB 54B (Expenditure incurred by foreign investment PIEs):
18. sections DV 2, DV 4, and DV 5 (which relate to transfers of expenditure to a master superannuation fund that is a PIE).

19. Certain PIEs either have special rules related to their activities or are affected by some particular rules. These are set out below:

20. for a listed PIE, see the following:
    1. section CX 56C (Distributions to investors by listed PIEs):
    2. section EZ 63 (Disposal and acquisition upon entry):
    3. section HM 2(3), which relates to listed PIEs becoming multi-rate PIEs:
    4. section HM 18, which describes how an unlisted company becomes a listed PIE:
    5. section HM 19, which relates to distributions of listed PIEs:
    6. section HM 21(4), for a transitional provision for investors in listed PIEs:
    7. section HM 28, for the consequences when a listed PIE does not meet a distributional requirement:
    8. sections MB 1(5) and MB 11, which relate to family scheme income:
21. for a life fund PIE, see the following:
    1. section CX 55 (Proceeds from disposal of investment shares):
    2. section DR 1(2) (Policyholder base allowable deduction of life insurer):
    3. section EY 1(2) (What this subpart does):
    4. section EY 2(6) (Policyholder base):
    5. section HM 4, which is about who can be an investor:
    6. section HM 10, which excludes entities other than life fund PIEs carrying on a business of life insurance:
    7. section HM 17, for an additional entry rule for PIEs other than life fund PIEs:
    8. section HM 19, for an additional entry rule for listed PIEs other than life fund PIEs:
    9. section HM 26, for an exit rule for entities other than life fund PIEs starting a life insurance business:
    10. section OB 35B (ICA debit for transfer from tax pooling account for policyholder base liability):
    11. section OP 33B (Consolidated ICA debit for transfer from tax pooling account for policyholder base liability):
22. for a foreign investment PIE, see the following:
    1. section CX 56 (Attributed income of certain investors in multi-rate PIEs):
    2. section CX 56B (Distributions to investors in multi-rate PIEs):
    3. section DB 54B (Expenditure incurred by foreign investment PIEs):
    4. section HM 6B, for the optional look-through treatment of income derived from other PIEs:
    5. section HM 19B, for the particular requirements for foreign investment zero-rate PIEs:
    6. section HM 19C, for the particular requirements for foreign investment variable-rate PIEs:
    7. section HM 35C, which is about the determination of the income tax liability of a foreign investment PIE and the calculation of attributed PIE income for a notified foreign investor:
    8. sections HM 41(4) and HM 44(1B), for restrictions on the calculation method available to foreign investment PIEs:
    9. section HM 44B, for an additional calculation method for foreign investment PIEs:
    10. section HM 47, which is about the calculation of the tax liability or tax credit of a foreign investment PIE:
    11. sections HM 55C to HM 55H, for the special requirements for foreign investment PIEs and their investors:
    12. section HM 71B, for the election mechanism for foreign investment PIEs:
    13. schedule 6, tables 1 and 1B, for the prescribed tax rates for certain non-resident investors in foreign investment PIEs and the rates applying to certain sources of income attributed to investors:
    14. section 28D of the Tax Administration Act 1994, for the information required from notified foreign investors.

23. Subpart LS (Tax credits for multi-rate PIEs and investors) contains the rules relating to the amount and use of a tax credit arising under this subpart.

Compare

• ss HL 1, HL 2

Notes

• Section HM 1: inserted, on 1 April 2010 (applying for the 2010–11 and later income years), by section 292(1) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).
• Section HM 1(2)(i): amended, on 30 June 2014, by section 127 of the Taxation (Annual Rates, Employee Allowances, and Remedial Matters) Act 2014 (2014 No 39).
• Section HM 1(2)(ib): inserted, on 29 August 2011, by section 51(1) of the Taxation (Tax Administration and Remedial Matters) Act 2011 (2011 No 63).
• Section HM 1(2B) heading: inserted, on 29 August 2011, by section 51(2) of the Taxation (Tax Administration and Remedial Matters) Act 2011 (2011 No 63).
• Section HM 1(2B): inserted, on 29 August 2011, by section 51(2) of the Taxation (Tax Administration and Remedial Matters) Act 2011 (2011 No 63).