PART IU.K. Value Added Tax

1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F1U.K.

2. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F2U.K.

3. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F3U.K.

4. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F4U.K.

PART IIU.K. INCOME TAX AND CORPORATION TAX

5—12. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F5U.K.

13—15.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F6U.K.

16,17. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F7U.K.

18. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F8U.K.

PART IIIU.K. CAPITAL TRANSFER TAX

Main charging provisionsU.K.

19 Capital transfer tax.U.K.

(1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F9

(2)Schedule 4 to this Act shall have effect with respect to the administration and collection of the tax.

20—47. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F10U.K.

Estate duty and obsolete death dutiesU.K.

48 Interest on repayment of estate duty and on instalments of duty. U.K.

(1)In relation to any period falling after 12th November 1974 any sums repayable as sums paid in excess of estate duty or interest on estate duty shall carry interest at [F11the rate applicable under section 178 of the Finance Act 1989].

(2)Interest paid to any person under this section shall not be income of that person for any tax purposes.

(3)Subject to the following provisions of this section, where estate duty charged on a death occurring after 12th November 1974 is payable by instalments under section 62 of the M1Finance Act 1971 or section 3 of the M2Finance Act (Northern Ireland) 1971—

(a)as being charged in respect of property falling within paragraph (a) or (b) of subsection (2) of that section ; or

(b)as being attributable to the net value of a business or an interest in a business ;

it shall, for the purpose of any interest to be added to each instalment, be treated as carrying interest from the date at which the instalment is payable.

(4)Subsection (3) above does not apply to estate duty payable in respect of shares or securities of a company falling within paragraph (a) of subsection (5) below unless it also falls within paragraph (b) or (c) of that subsection.

(5)The companies referred to in subsection (4) above are—

(a)any company whose business consists wholly or mainly of one or more of the following, that is to say, dealing in securities, stocks or shares, land or buildings, or making or holding investments ;

(b)any company whose business consists wholly or mainly in being a holding company (within the meaning of section 154 of the M3Companies Act 1948) of one or more companies not falling within paragraph (a) above ; and

(c)any company whose business is that of a jobber (as defined in section 477 of the Taxes Act) or discount house, and is carried on in the United Kingdom.

(6)Subsection (3) above does not apply to estate duty charged in respect of property which, by reason of an interest which came to an end, or a gift which was made, before 13th November 1974, passes on death by virtue of section 2(1)(b)(i) or section 2(1)(c) of the M4Finance Act 1894.

(7)Subsection (3) above applies only to the extent that the principal value in respect of which the duty is payable as mentioned therein does not exceed £250,000 ; and any excess shall be attributed to duty in respect of the shares, securities, business or interest concerned in proportion to their respective values.

49 Abolition of estate duty and transitional provisions. U.K.

(1)Estate duty shall not be levied on the principal value of any property passing on a death occurring after the passing of this Act ; and the enactments relating to estate duty shall have effect in relation to a death occurring before the passing of this Act but after 12th November 1974 subject to the amendments specified in Schedule 11 to this Act.

(2)Part II of Schedule 8 to this Act shall have effect for making, in relation to deaths occurring after 12th November 1974, provisions with respect to estate duty similar to those made with respect to capital transfer tax by Part I of that Schedule.

(3). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F12

(4)Where estate duty is under section 61(5) of the M5Finance (1909-10) Act 1910 payable on the net moneys received from the sale of timber, trees or wood when felled or cut during the period referred to therein and that period has not ended before the passing of this Act, that period shall end immediately after the first transfer of value made after the passing of this Act in which the value transferred is, or is determined by reference to, the value of the land concerned, other than a transfer exempt by virtue of paragraph 1 of Schedule 6 to this Act.

(5). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F12

50 Final abolition of obsolete death duties. U.K.

(1)After the passing of this Act no person shall in any case be required to account for or pay, and the Board shall not in any case charge, levy, recover or collect—

(a)any duty described in Schedule 1 to the M6Finance Act 1894 ;

(b)any duty imposed on a representation or inventory by any Act in force before the M7Customs and Inland Revenue Act 1881 ;

(c)any legacy duty, succession duty or settlement estate duty ;

(including in each case any duty which is then outstanding).

(2)This section does not affect any right to repayment of or to any allowance in respect of any sum paid before the passing of this Act on account of any such duty.

SupplementalU.K.

51. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F13U.K.

52 Consequential amendments and repeals.U.K.

(1)In consequence of the preceding provisions of this Part of this Act the enactments mentioned in Schedule 12 to this Act shall have effect subject to the amendments specified therein.

(2)The enactments mentioned in Part I of Schedule 13 to this Act are hereby repealed, to the extent specified in the third column of that Part—

(a)in relation to deaths occurring after the passing of this Act; and

(b)so far as they relate to the duties mentioned in section 50 of this Act, in relation to any death.

(3)The repeal by this section of any enactment relating to a duty mentioned in section 50 of this Act shall not affect its operation for the purposes of any such right to repayment or allowance as is referred to in subsection (2) of that section.

PART IVU.K. MISCELLANEOUS AND GENERAL

53. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F14U.K.

F1554. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .U.K.

55. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F16U.K.

F1756. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .U.K.

F1857 Appointment of General Commissioners in Scotland, and amendment of declaration to be made by certain officers.U.K.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F1958. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .U.K.

59 Citation, interpretation, construction and repeals.U.K.

(1)This Act may be cited as the Finance Act 1975.

(2)In this Act “the Taxes Act” means the Income and Corporation Tax Act 1970.

(3)In this Act—

(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F20

(b)Part II, so far as it relates to income tax, shall be construed as one with the Income Tax Acts and, so far as it relates to corporation tax, shall be construed as one with the Corporation Tax Acts.

(4)Except so far as the context otherwise requires, any reference in this Act to any enactment shall be construed as a reference to that enactment as amended, and as including a reference to that enactment as applied, by or under any other enactment, including this Act.

(5)The enactments mentioned in Schedule 13 to this Act are hereby repealed to the extent specified in the third column of that Schedule, but subject to any provision at the end of any Part of that Schedule.

SCHEDULES

SCHEDULE 1U.K. . . . F21

SCHEDULE 2U.K. . . . F22

SCHEDULE 3U.K. . . . F23

Section 19.

SCHEDULE 4U.K. Administration and Collection of Capital Transfer Tax

1—37U.K.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F24

Refusal of probate or administration where tax unpaidU.K.

38(1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F25U.K.

(2)In section 42 of the M8Probate and Legacy Duties Act 1808 after the words “as aforesaid”, where they first occur, there shall be inserted the words “ nor unless that inventory shows by means of such receipt or certification as may be prescribed by the Commissioners of Inland Revenue either that the capital transfer tax payable on the delivery of the inventory has been paid or that no capital transfer tax is so payable ” ; and at the end there shall be inserted the following words—

(3). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F26

(4)[F27The sections inserted by sub-paragraphs (1) . . . F28 and] the amendments made by sub-paragraph (2) above have effect in relation to grants and confirmations in respect of the estates of persons dying after the passing of this Act.

39—44U.K.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F29

SCHEDULES 5—7U.K. . . . F30

Section 49(2).

SCHEDULE 8U.K. Relief for Agricultural Property

Part IU.K.

1–11U.K.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F31

Part IIU.K. Estate Duty

Nature of reliefU.K.

12U.K.Where the estate chargeable with estate duty on the death of a person dying after 12th November 1974 comprises agricultural property, other than agricultural property included (under section 2(1)(b)(i) or 2(1)(c) of the M9Finance Act 1894) by reason of an interest which came to an end or a gift which was made before 13th November 1974, then, if the conditions stated in paragraph 3 above (as modified by paragraph 16 below) are satisfied and—

(a)the principal value of the agricultural property would be reduced if computed in accordance with paragraph 13 below ; and

(b)the person accountable for estate duty in respect of the agricultural property makes a claim in that behalf to the Board within six months of the passing of this Act or such longer time as the Board may allow ;

the principal value of that property shall be so computed and estate duty charged accordingly, but subject to the limit imposed by paragraph 15 below.

13(1)Where the principal value of any agricultural property is to be computed in accordance with this paragraph it shall be computed, subject to sub-paragraph (2) below, as if the agricultural value of the property were equal to its multiplied rental value.U.K.

(2)Where paragraph 3(5) above (as modified by paragraph 16 below) applies the principal value of the agricultural property shall be computed as if it were reduced by such proportion of the difference between it and the multiplied rental value of the property as is equal to the fraction mentioned in that paragraph.

CompaniesU.K.

14U.K.Where an estate comprises shares in or debentures of a company the principal value of which falls to be estimated in accordance with section 55 of the M10Finance Act 1940 or section 15 of the M11Finance (No. 2) Act (Northern Ireland) 1946, and the conditions stated in sub-paragraphs (a), (c) and (d) of paragraph 4 above (as modified by paragraph 16 below) are satisfied with respect to the company, any agricultural property and the shares or debentures, paragraphs 12 and 13 above shall apply, with the necessary modifications, in relation to the principal value of the shares or debentures, and estate duty chargeable in respect thereof.

Limitation of reliefU.K.

15U.K.Relief under this Part of this Schedule shall be given only to the extent that either—

(a)the agricultural value of the agricultural property does not exceed £250,000 or

(b)the area of the agricultural property does not exceed one thousand acres.

SupplementaryU.K.

16(1)For the purposes of relief under this Part of this Schedule—U.K.

(a)paragraphs 3, 4 and 5(2) above shall apply as if for references to the transferor and the transfer there were substituted references to the deceased and his death ;

(b)paragraph 3(5) above shall apply with the further modification specified in sub-paragraph (2) below ;

(c)paragraph 5(2) above shall apply for the purposes of paragraph 15 above ; and

(d)paragraph 9(5) above shall apply as if for the reference to tax there were substituted a reference to estate duty.

(2)For the purposes of relief under this Part of this Schedule paragraph 3(5) above shall apply as if it required the principal value of the agricultural property to be computed in accordance with paragraph 13(2) above.

SCHEDULES 9,10U.K. . . . F32

Section 49.

SCHEDULE 11U.K. Amendment of Estate Duty Enactments

Part I—Great BritainU.K.

1U.K.In Part I of Schedule 17 to the M12Finance Act 1969 (determination of amount of estate duty on estate) for paragraph (b) there shall be substituted the following paragraph:

“(b)in any other case shall be the same amount as the amount of capital transfer tax which would, under section 37 of the Finance Act 1975, be charged on that aggregate principal value if it were the value transferred by a chargeable transfer made on death and the transferor had made no previous chargeable transfer”.

2(1)In section 121(1)(c) of the M13Finance Act 1972 (which gives relief for a surviving spouse up to a limit of £15,000) the words “up to a limit of £15,000” shall be omitted.U.K.

(2)In Schedule 26 to that Act (provisions supplementary to section 121)—

(a)in paragraph 15—

(i)in sub-paragraph (a) after the words “paragraph (a)” there shall be inserted the words “ or (c) ” ; and

(ii)in sub-paragraph (b) the words “or (c)” shall be omitted ;

(b)in paragraph 17—

(i)in sub-paragraph (a) after the words “paragraph (a)” there shall be inserted the words “ or (c) ” ; and

(ii)in sub-paragraph (b) the words “or (c)” (in each place where those words appear) shall be omitted ;

(c)in paragraph 19, in sub-paragraph (a) the words “or (c)” shall be omitted ; and

(d)in paragraph 20, the words “or (c)” shall be omitted.

(3)Where one party to a marriage dies after 12th November 1974 and subsequently (but before the passing of this Act) the other party dies, section 32(2) of the M14Finance Act 1954 shall have effect in relation to the death of that other party with the omission of the words inserted by paragraph 26 of Schedule 26 to the Finance Act 1972.

(4)The preceding provisions of this paragraph do not apply where, immediately before the death, the deceased but not his spouse was domiciled in the United Kingdom.

3U.K.Section 23 of the M15Finance Act 1925 and section 28 of the Finance Act 1954 (reduced rates on agricultural property and certain business assets) shall not have effect except in relation to property which, by reason of an interest which came to an end or a gift which was made before 13th November 1974, passes on death by virtue of section 2(1)(b)(i) or section 2(1)(c) of the M16Finance Act 1894.

PART II—Northern IrelandU.K.

4U.K.In Part I of Schedule 1 to the M17 (determination of amount of estate duty payable on estate) for paragraph (b) there shall be substituted the following paragraph:

“(b)in any other case shall be the same amount as the amount of capital transfer tax which would, under section 37 of the Finance Act 1975, be charged on that aggregate principal value if it were the value transferred by a chargeable transfer made on death and the transferor had made no previous chargeable transfer”.

5(1)In Article 5(1)(c) of the M18Finance (Northern Ireland) Order 1972 (which gives relief for a surviving spouse up to a limit of £15,000) the words “up to a limit of £15,000” shall be omitted.U.K.

(2)In Schedule 2 to that Order (provisions supplementary to Article 5)—

(a)in paragraph 15—

(i)in sub-paragraph (a) after the words “sub-paragraph (a)” there shall be inserted the words “ or (c) ” ; and

(ii)in sub-paragraph (b) the words “or (c)” shall be omitted ;

(b)in paragraph 17—

(i)in sub-paragraph (a) after the words “sub-paragraph (a)” there shall be inserted the words “ or (c) ” ; and

(ii)in sub-paragraph (b) the words “or (c)” (in each place where those words appear) shall be omitted ;

(c)in paragraph 19, in sub-paragraph (a) the words “or (c)” shall be omitted ; and

(d)in paragraph 20, the words “or (c)” shall be omitted.

(3)Where one party to a marriage dies after 12th November 1974 and subsequently (but before the passing of this Act) the other party dies, section 2(1) of the M19 (N.I.).Finance Act (Northern Ireland) 1954 shall have effect in relation to the death of that other party with the omission of the words inserted by paragraph 26 of Schedule 2 to the M20Finance (Northern Ireland) Order 1972.

(4)The preceding provisions of this paragraph do not apply where, immediately before the death, the deceased but not his spouse was domiciled in the United Kingdom.

6U.K.Section 3 of the M21 (N.I.).Finance (No. 2) Act (Northern Ireland) 1947 and section 3 of the Finance Act (Northern Ireland) 1954 (reduced rates on agricultural property and certain business assets) shall not have effect except in relation to property which, by reason of an interest which came to an end or a gift which was made before 13th November 1974, passes on death by virtue of section 2(1)(b)(i) or section 2(1)(c) of the M22Finance Act 1894.

Section 52.

SCHEDULE 12U.K. CONSEQUENTIAL AMENDMENTS

GeneralU.K.

1U.K.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F33

2U.K.The amendments made by the following paragraphs—

(a)so far as they relate to estate duty, have effect in relation to deaths occurring after the passing of this Act, and

(b)so far as they relate to capital transfer tax, have effect in relation to transfers of values whenever made.

The Local Registration of Title (Ireland) Act 1891U.K.

3(1)In the M23Local Registration of Title (Ireland) Act 1891, the following subsection shall be added at the end of section 45—U.K.

“(5)The registering authority may, upon the application of the Board of Inland Revenue and without the concurrence of the registered owner, register an Inland Revenue charge (within the meaning of Part Ill of the Finance Act 1975) as a burden under this section affecting the land or any interest therein subject to that charge.”.

(2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F34

The Colonial Probates Act 1892U.K.

4U.K.In section 2(1) of the M24Colonial Probates Act 1892 after the words “deceased person” there shall be inserted the words “ then (subject to section 156A of the M25Supreme Court of Judicature (Consolidation) Act 1925, section 42 of the M26Probate and Legacy Duties Act 1808 and section 99A of the M27Probates and Letters of Administration Act (Ireland) 1857) ”.

The Land Registration Act 1925U.K.

F355U.K.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

The Inheritance (Family Provision) Act 1938U.K.

6U.K.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F36

The Finance Act 1946U.K.

7U.K.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F37

The M28Crown Proceedings Act 1947U.K.

8U.K.In section 14(1) of the Crown Proceedings Act 1947—

(a)in paragraph (a), for the words “death duties” there shall be substituted the words “ capital transfer tax ” ; and

(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F38

9U.K.In section 14 of the Crown Proceedings Act 1947, as applied to the Crown in right of Her Majesty’s Government in the United Kingdom by the M29Northern Ireland (Crown Proceedings) Order 1949, in paragraph (c) and (d) after the words “value added tax” there shall be inserted the words “ and capital transfer tax ”.

M30Small Estates (Representation) Act 1961U.K.

10(1)In relation to Scotland section 1 of the Small Estates (Representation) Act 1961 shall be amended as provided by the following sub-paragraphs.U.K.

(2)For subsection (2) there shall be substituted the following subsection—

“(2)Gross estate in this Act and in the enactments specified in the First Schedule to this Act means the aggregate of the property heritable and moveable included in the deceased’s estate, and for the purposes of this Act and those enactments the value of the net estate shall be taken to be the value of the gross estate less reasonable funeral expenses and the aggregate of all liabilities enforceable against the deceased which were incurred forhis benefit, and in respect of which he had no right of recourse.”

(3)Subsection (3) shall be omitted.

The M31Licensing Act 1964U.K.

11U.K.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F39

The M32Finance Act 1965U.K.

12, 13.U.K.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F40

14, 15.U.K.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F41

The Income and Corporation Taxes Act 1970U.K.

16U.K.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F42

The Finance Act 1971U.K.

17U.K.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F43

The Land Charges Act 1972U.K.

18(1)The M33Land Charges Act 1972 shall be amended as follows.U.K.

(2)In section 2(4)(ii), for the words “the Finance Act 1894 or” there shall be substituted the words “ Part III of the Finance Act 1975 or under ”, and for the words “death duties” there shall be substituted the words “ capital transfer tax ”.

(3). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F44

(4)In section 3(6), for the word “duties” there shall be substituted the word “ tax ”.

(5)In section 4(6), after the words “money’s worth” there shall be inserted the words “ (or, in the case of an Inland Revenue charge, a purchaser within the meaning of Part III of the Finance Act 1975) ”.

(6)In section 17(1), for the words “will” and “death duties” there shall be substituted the words “ and will ”.

The Finance Act 1974U.K.

19U.K.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F45

M34The Inheritance (Family Provision) Act (Northern Ireland) 1960U.K.

20(1)In section 5(1) of the Inheritance (Family Provision) Act (Northern Ireland) 1960, for the words “estate duty” there shall be substituted the words “ capital transfer tax ”.U.K.

(2)In section 9(1) of that Act, in the definition of “net estate”, for the words “estate duty” there shall be substituted the words “ capital transfer tax ”.

M35The Land Registration Act (Northern Ireland) 1970U.K.

21U.K.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Section 59.

SCHEDULE 13U.K. REPEALS

PART IU.K. DEATH DUTIES

Enactments of the Parliament of Northern IrelandU.K.

These repeals have effect—

(a)in relation to deaths occurring after the passing of this Act; and

(b)so far as they relate to any duty mentioned in section 50 of this Act, in relation to any death, but subject to section 52(3) of this Act.

PART IIU.K. MISCELLANEOUS

1U.K.The repeal in the M36Taxes Management Act 1970 takes effect on 16th May 1975.

2U.K.The repeals in section 21 of the M37 Income and Corporation Taxes Act 1970 have effect for the year 1976-77 and subsequent years of assessment.

3U.K.The repeals in sections 394 to 398 of the Income and Corporation Taxes Act 1970 have effect in relation to the events mentioned in paragraph 8 of Schedule 2 to this Act.

4U.K.The repeal in the M38 Vehicles (Excise) Act (Northern Ireland) 1972 has effect as from 31st July 1974.

5U.K.The repeals of Schedule 25 to the M39Finance Act 1972 and section 51 of the M40 Finance Act 1974 have effect in relation to disposals made after 26th March 1974.