accrued income scheme
A scheme which charges to tax that proportion of the sale price of securities within its scope (debt securities), which is equivalent to the income that has accrued on the security since the last income payment date (sections 710 and 728, Income and Corporation Taxes Act 1988 for periods before 2007-2008 and Chapter 2, Part 12, Income Tax Act 2007 thereafter). The effect of the scheme is that if a buyer gives, say, 105 for 100 nominal, of which 102 is the ‘clean' price (that is, ignoring the accrued income since the last income payment date) and the remaining 3 represents the income which has accrued since that date, the accrued income scheme is designed to tax the 3 as income of the seller. Until the introduction of the accrued income scheme the 105 was treated as entirely capital. The scheme generally gives a credit to a buyer of securities so that when the buyer receives, say, an income payment of 5 at the end of the income period, the 3 which the buyer gave as part of the purchase price for the securities and which was treated as income of the seller is deducted from the income for the buyer's tax purposes.
Related links

Practical Law Dictionary. Glossary of UK, US and international legal terms. . 2010.

Look at other dictionaries:

  • accrued income scheme — An arrangement that applies in the UK when the owner of interest bearing securities disposes of them. The interest accrued between the date of the last interest payment and the date of disposal is regarded, for tax purposes, as the income of the… …   Big dictionary of business and management

  • Income tax in India — The Indian Income Tax department is governed by the Central Board for Direct Taxes (CBDT) and is part of the Department of Revenue under the Ministry of Finance.The government of India imposes an income tax on taxable income of individuals, Hindu …   Wikipedia

  • Fixed income attribution — refers to the process of measuring returns generated by various sources of risk in a fixed income portfolio, particularly when multiple sources of return are active at the same time. For example, the risks affecting the return of a bond portfolio …   Wikipedia

  • Fixed-income attribution — refers to the process of measuring returns generated by various sources of risk in a fixed income portfolio, particularly when multiple sources of return are active at the same time. For example, the risks affecting the return of a bond portfolio …   Wikipedia

  • СХЕМА НАКОПЛЕННОГО ДОХОДА — (accrued income scheme) Налоговое правило, применяемое в Великобритании в тех случаях, когда владелец приносящих проценты ценных бумаг сбрасывает их. При налогообложении процент, наросший на ценные бумаги за период между последней выплатой… …   Финансовый словарь

  • Social Security (United States) — This article is about the retirement/disability program. For the general concept of providing welfare, see Social security. For other uses, see Social Security (disambiguation) …   Wikipedia

  • Pension — This article is about the retirement income arrangement. For the type of lodging, see Pension (lodging). For the mortgage repayment scheme, see Mortgage loan. Financial market participants …   Wikipedia

  • List of Statutory Instruments of the United Kingdom, 1995 — This is a complete list of all 1,872 Statutory Instruments published in the United Kingdom in the year 1995. NOTOC 1 100* National Health Service (Optical Charges and Payments) (Scotland) Amendment Regulations 1995 S.I. 1995/1 * Plymouth… …   Wikipedia

  • Defined benefit pension plan — For the defined contribution pension plan, see Defined Contribution Pension Plan. In economics, a defined benefit pension plan is a major type of pension plan in which an employer promises a specified monthly benefit on retirement that is… …   Wikipedia

  • United States — a republic in the N Western Hemisphere comprising 48 conterminous states, the District of Columbia, and Alaska in North America, and Hawaii in the N Pacific. 267,954,767; conterminous United States, 3,022,387 sq. mi. (7,827,982 sq. km); with… …   Universalium

Share the article and excerpts

Direct link
Do a right-click on the link above
and select “Copy Link”