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E1.1112 Transfer of assets abroad—the charge under ITA 2007, s 727

The stated purpose of ITA 2007, s 727 is exactly the same as for ITA 2007, s 720 at E1.1103, ie to prevent the avoiding of liability to income tax by individuals resident in the UK by means of relevant transfers¹. In this case, however, it does so by charging tax on income treated as arising to an individual by virtue of his receiving a capital sum by virtue of relevant transfers and / or associated operations. 'Relevant transfers' and 'associated operations' have the same meaning as in, respectively, E1.1103 and E1.1104.

The charge under ITA 2007, s 727 is completely separate to, and operates independently of, the charge under ITA 2007, s 720. For the charge under ITA 2007, s 727 to apply, there is no requirement that the individual in question has power to enjoy income of the person abroad.