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My client invests in offshore funds and has ‘excess reportable income’ (ERI) to report on his tax return. ERI is excess income which has not been distributed by the fund. The relevant legislation is the Offshore Funds (Tax) Regulations SI 2009/3001 Pt 3 ch 8 reg 94. ERI is a notional distribution not an actual distribution of income but it is taxable.
The legislation says that the ERI is to be treated as paid on the fund’s distribution date which is six months after the fund’s reporting year end.
An offshore fund that had a year end of 31 December would therefore have a fund distribution date of 30 June. The ERI is taxable in the tax year that the fund distribution date falls into.
I need to convert the ERI to pounds sterling (GBP) because it is in foreign currency. I have...
