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HM 16: Associates combined
or “Counting connected investors as one for group ownership calculations”
You could also call this:

“Everyone gets equal rights to investment returns in a PIE”

This section talks about rules for a special kind of investment called a PIE (Portfolio Investment Entity) that isn’t a life fund PIE. It says that if you invest in a PIE, you should get the same rights as everyone else who invests in it. This means that no matter what kind of money the investment makes, everyone should get their fair share.

There are a couple of exceptions to this rule. It doesn’t apply if the money made is something called “category B income”. Also, if there’s only one group of investors and they only make money from financial arrangements, then this rule doesn’t apply to them.

The section also mentions that if you’re a foreign investor who gets told about extra dividends, these don’t count when thinking about whether everyone has the same rights.

Remember, if you want to know more about financial arrangements, you can look at section CC 3. And if you’re curious about foreign investors and dividends, you can check section HM 44B(2).

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Next up: HM 18: Requirements for listed PIEs: unlisted companies

or “Rules for unlisted companies to become listed PIEs”
Next

Part H Taxation of certain entities
Portfolio investment entities: Requirements

HM 17Same rights to all investment proceeds

  1. This section is an additional entry rule for a PIE that is not a life fund PIE.

  2. All investor interests in the entity that give rights in relation to proceeds from a portfolio investment must give the same rights in relation to all types of proceeds from the investment.

  3. This section does not apply if—

  4. the proceeds are category B income:
    1. for a single investor class, the only income that the class derives is income under section CC 3 (Financial arrangements).

      1. For the purposes of this section, the payment of a supplementary dividend that is attributed to a notified foreign investor, or would be attributed to them in the absence of section HM 44B(2), is disregarded.

      Compare
      • s HL 5C
      Notes
      • Section HM 17: inserted, on (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 17(3) heading: replaced, on , by section 93(1) of the Taxation (Annual Rates, Returns Filing, and Remedial Matters) Act 2012 (2012 No 88).
      • Section HM 17(3): replaced, on , by section 93(1) of the Taxation (Annual Rates, Returns Filing, and Remedial Matters) Act 2012 (2012 No 88).
      • Section HM 17(4) heading: inserted, on (applying for the 2013–14 and later income years), by section 93(2) of the Taxation (Annual Rates, Returns Filing, and Remedial Matters) Act 2012 (2012 No 88).
      • Section HM 17(4): inserted, on (applying for the 2013–14 and later income years), by section 93(2) of the Taxation (Annual Rates, Returns Filing, and Remedial Matters) Act 2012 (2012 No 88).
      • Section HM 17 list of defined terms income: inserted, on , by section 93(3) of the Taxation (Annual Rates, Returns Filing, and Remedial Matters) Act 2012 (2012 No 88).
      • Section HM 17 list of defined terms investor class: inserted, on , by section 93(3) of the Taxation (Annual Rates, Returns Filing, and Remedial Matters) Act 2012 (2012 No 88).
      • Section HM 17 list of defined terms notified foreign investor: inserted, on , by section 93(3) of the Taxation (Annual Rates, Returns Filing, and Remedial Matters) Act 2012 (2012 No 88).
      • Section HM 17 list of defined terms supplementary dividend: inserted, on , by section 93(3) of the Taxation (Annual Rates, Returns Filing, and Remedial Matters) Act 2012 (2012 No 88).