RPSM04103050 - Technical Pages: Taxation: Scheme investments: Futures and options contracts
Futures and options contracts
Exemption from income tax
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[s186(3) & (4)] |
Futures contracts and options contracts involving registered pension schemes are classed as investments held for the purpose of the scheme. This enables such contracts to qualify for the normal rule for exemption from income tax in relation to investments held for the purpose of a registered pension scheme - see RPSM04103010.
A contract is not prevented from being a futures contract or an options contract if full settlement of all obligations is made by a lump sum payment rather than a transfer of assets. Therefore income from these contracts is exempt from income tax.
Additionally, any income derived from transactions relating to futures contracts and options contracts in relation to a registered pension scheme is regarded as being derived from those contracts and also is exempt from income tax under the normal rule for exemptions.
Exemption from capital gains tax
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[s187(6)][s271(10) TCGA 1992] |
Futures contracts and options contracts are classed as investments for the purpose of the exemption from capital gains tax given in respect of investments held for the purposes of registered pension schemes.
A contract is not prevented from being a futures contract or an options contract if full settlement of all obligations is made by a lump sum payment rather than a transfer of assets. So any gain arising from the disposal of one or more of these contracts is exempt from capital gains tax.
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Glossary (RPSM20000000) |
