This notice relates to the international entities: Canada Life International Assurance (Ireland) DAC (“CLIAI’’) and/or Canada Life International Limited (“CLI”) and / or CLI Institutional Limited (“CLII”)
We are announcing that we are conditionally re-opening new investments into UK Property Funds.
Canada Life will only accept new purchases into a UK Property Funds (following the definition of UK property rich collective investment vehicle in Taxation of Chargeable Gains Act 1992, Schedule 5AAA, Part 1) where:
- The fund size is greater than Canada Life’s internal limit (currently GBP100 million), and
- Canada Life’s total percentage holding is below Canada Life’s internal limit (currently 5%).
Our current interpretation is that this restriction does not apply to Real Estate Investment Trusts (REITs) and Exchange Traded Funds (ETFs), as these funds meet the exemption criteria detailed in Taxation of Chargeable Gains Act 1992, Schedule 5AAA, Part 4, 12 (2).
Why have we made this decision?
Her Majesty’s Revenue and Customs (HMRC) introduced anti-avoidance tax legislation on 6 April 2019 to target non-UK residents investing in certain UK Property Funds.
Following lobbying from Canada Life and other overseas life companies, the UK Government has amended the legislation, with new rules coming into force on 24 March 2021 and applying retrospectively back to 6 April 2019. As a result of the new changes, overseas life companies are not subject to capital gains tax if the company holds less than 10% of the UK Property Fund.
We have carefully considered the revised legislation and the impact to our customers and our business and will be allowing new investments in UK Property Funds when certain conditions are met. We will be regularly monitoring our percentage holdings in UK Property Funds to ensure that we do not breach the 10% holding limit which applies to overseas life companies.
We have created a list of funds that are affected by this decision, indicating which funds are now available and those that are still restricted.
Please note this list is for guidance only and is not exhaustive as other funds may be impacted.
Please contact firstname.lastname@example.org for any further advice.
Alternatively, you can call us on +44 (0) 1624 820 200, Monday to Friday or email us at email@example.com. Call charges may vary and we may record and monitor calls.