This section applies to a settlement for a tax year ("the relevant tax year") if there is no time in that year when the trustees are resident in the United Kingdom.
Chargeable gains are treated as accruing in the relevant tax year to a beneficiary of the settlement who has received a capital payment from the trustees in the relevant tax year or any earlier tax year if all or part of the capital payment is matched (under section 87A as it applies for the relevant tax year) with the section 1(3) amount for the relevant tax year or any earlier tax year.
If the relevant tax year is a split year as respects the beneficiary, the gains are treated as accruing in the UK part of that year.
The amount of chargeable gains treated as accruing is equal to—
The section 1(3) amount for a settlement for a tax year for which this section applies to the settlement is—
The section 1(3) amount for a settlement for a tax year for which this section does not apply to the settlement is nil.
Where (apart from this subsection) the amount mentioned in subsection (4)(a) would include a chargeable gain or allowable loss to which section 1A(3)(b) or (c) applies (disposals by non-UK residents within the charge to capital gains tax), so much of the gain or loss as would be so included is to be disregarded for the purposes of determining the section 1(3) amount.
Where (apart from this subsection) the amount mentioned in subsection (4)(a) would include an amount of chargeable gains treated as accruing under section 103KA(2) or (3) (carried interest gains), the amount of the gains is to be disregarded for the purposes of determining the section 1(3) amount.
For the purposes of this section a settlement arising under a will or intestacy is treated as made by the testator or intestate at the time of death.
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See also paragraph 4 of Schedule D1 (foreign gain claims: capital payments ignored for the purposes of this section and Schedule 4C).