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Capital gains—unit trusts and open-ended investment companies

C2.803 Unit trusts and open-ended investment companies

Authorised unit trusts and open-ended investment companies are exempt from capital gains tax, see C1.209.

For capital gains purposes, an authorised unit trust is treated as if it was a company and the rights of a unit holder are treated as if they were shares in that company¹. This means that exchanges or conversion of units are treated in the same way as exchanges or conversion of company shares where there is a reorganisation or reconstruction². There is, however, an exception to this rule regarding treatment as a company in relation to disposals made on or after 1 January 2018 for offshore funds that are transparent funds within the meaning given by the Offshore Funds (Tax) Regulations 2009³ (see B5.702)⁴.

An umbrella scheme is a relevant collective investment scheme (for disposals before 8 June 2013, an authorised unit trust) which pools its assets into separate sub-funds; the