REV BN 19: Court Common Investment Funds
Who is likely to be affected?
1. People with funds held in court common investment funds (CCIFs).
General description of the measure
2. The measure makes some changes required as a result of improvements to be made by the Lord Chancellor to the scheme rules under which CCIFs are run.
Operative date
3. The measure has effect in relation to people with funds held in a CCIF on or after 6 April 2003.
Current law and proposed revisions
4. CCIFs are a form of unit trust set up by the Lord Chancellor under section 42(1) Administration of Justice Act 1982. They exist as vehicles into which funds in court (for, say, children who have been the victims of road accidents) may be placed. Currently only the Accountant General of England and Wales (or Northern Ireland equivalent) is able to hold units on behalf of the people the funds are designed to benefit. This is reflected in the special tax rules that were introduced in 1999. These rules removed a potential disadvantage, which the abolition of payable tax credits might otherwise have caused to people with funds held in CCIFs, by treating CCIFs as authorised unit trusts.
5. Scheme improvements will allow further categories of persons to participate in CCIFs, including beneficiaries themselves. Tax changes are therefore necessary to allow these additional categories to be regarded as unit holders.
Further advice
6. If you have any questions about this change, please contact the Public Enquiry Unit on 020 7438 6420 to 6425.
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