Finance Act 1991

1991 c. 31

An Act to grant certain duties, to alter other duties, and to amend the law relating to the National Debt and the Public Revenue, and to make further provision in connection with Finance.

Most Gracious Sovereign, We, Your Majesty’s most dutiful and loyal subjects, the Commons of the United Kingdom in Parliament assembled, towards raising the necessary supplies to defray Your Majesty’s public expenses, and making an addition to the public revenue, have freely and voluntarily resolved to give and grant unto Your Majesty the several duties hereinafter mentioned; and do therefore most humbly beseech Your Majesty that it may be enacted, and be it enacted by the Queen’s most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—

Part ICUSTOMS AND EXCISE, VALUE ADDED TAX AND CAR TAX

CHAPTER I CUSTOMS AND EXCISE

Rates of duty

I11 Spirits, beer, wine, made-wine and cider.

1

In section 5 of the M1Alcoholic Liquor Duties Act 1979 (spirits) for “£17.35” there shall be substituted “ £18.96 ”.

2

In section 36 of that Act (beer) for “£0.97” there shall be substituted “ £1.06 ”.

3

For the Table of rates of duty in Schedule 1 to that Act (wine and made-wine) there shall be substituted the Table in Schedule 1 to this Act.

4

In section 62(1) of that Act (cider) for “£18.66” there shall be substituted “ £20.40 ”.

5

This section shall be deemed to have come into force at 6 o’clock in the evening of 19th March 1991.

Annotations:
Commencement Information
I1

S. 1 in force at 6 p.m. 19.03.1991: see s. 1(5).

Marginal Citations

I22 Tobacco products.

1

For the Table in Schedule 1 to the M2Tobacco Products Duty Act 1979 there shall be substituted—

TABLE

1. Cigarettes

An amount equal to 21 per cent. of the retail price plus £40.15 per thousand cigarettes.

2. Cigars

£61.72 per kilogram.

3. Hand-rolling tobacco

£65.12 per kilogram.

4. Other smoking tobacco and chewing tobacco

£28.69 per kilogram.

2

This section shall be deemed to have come into force at 6 o’clock in the evening of 19th March 1991.

Annotations:
Commencement Information
I2

S. 2 in force at 6 p.m. 19.03.1991: see s. 2(2).

Marginal Citations

I33 Hydrocarbon oil.

1

In section 6(1) of the M3Hydrocarbon Oil Duties Act 1979, for “£0.2248” (duty on light oil) and “£0.1902” (duty on heavy oil) there shall be substituted “ £0.2585 ” and “ £0.2187 ” respectively.

2

In section 11(1) of that Act, for “£0.0083” (rebate on fuel oil) and “£0.0118” (rebate on gas oil) there shall be substituted “ £0.0091 ” and “ £0.0129 ” respectively.

3

In section 13A(1) of that Act (rebate on unleaded petrol) for “£0.0299” there shall be substituted “ £0.0344 ”.

4

In section 14(1) of that Act (rebate on light oil for use as furnace fuel) for “£0.0083” there shall be substituted “ £0.0091 ”.

5

This section shall be deemed to have come into force at 6 o’clock in the evening of 19th March 1991.

Annotations:
Commencement Information
I3

S. 3 in force at 6 p.m. 19.03.1991: see s. 3(5).

Marginal Citations

4

F11

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F12

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F13

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F24

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F15

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F16

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5 Pool betting duty.

1

In section 7(1) of the M4Betting and Gaming Duties Act 1981 (which specifies 40 per cent. as the rate of pool betting duty) for “40 per cent.” there shall be substituted “ 37.50 per cent. ”

2

This section shall apply in relation to bets made at any time by reference to an event taking place on or after 17th August 1991.

F36

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Duties of excise: other provisions

I47 Beer duty.

1

For section 36 of the M5Alcoholic Liquor Duties Act 1979 (charge on beer imported into, or brewed in, the United Kingdom of an excise duty at a rate per hectolitre for every degree by which the original gravity of the beer exceeds 1000 degrees) there shall be substituted—

36 Beer: charge of excise duty.

1

There shall be charged on beer—

a

imported into the United Kingdom, or

b

produced in the United Kingdom,

a duty of excise at the rate of £10.60 per hectolitre per cent. of alcohol in the beer.

2

Subject to the provisions of this Act—

a

the duty on beer produced in, or imported into, the United Kingdom shall be charged and paid, and

b

the amount chargeable in respect of any such duty shall be determined and become due,

in accordance with regulations under section 49 below.

C12

After section 41 of that Act (which specifies certain reliefs from duty) there shall be inserted—

41A Suspension of duty: registration of persons and premises.

1

A person registered by the Commissioners under this section may hold, on premises so registered in relation to him, any beer of a prescribed class or description—

a

which has been produced in, or imported into, the United Kingdom, and

b

which is chargeable as such with excise duty,

without payment of that duty.

2

A person entitled under subsection (1) above to hold beer on premises without payment of duty may also without payment of duty carry out on those premises such operations as may be prescribed on, or in relation to, such of the beer as may be prescribed.

3

No person shall be registered under this section unless—

a

he is a registered brewer or a packager of beer; and

b

he appears to the Commissioners to satisfy such requirements for registration as they may think fit to impose.

4

No premises shall be registered under this section unless—

a

they are used for the production or packaging of beer, or

b

they are adjacent to, and occupied by the same person as, premises falling within paragraph (a) above which are registered under this section,

and they appear to the Commissioners to satisfy such requirements for registration as the Commissioners may think fit to impose.

5

The Commissioners may register a person or premises under this section for such periods and subject to such conditions as they think fit.

6

The Commissioners may at any time for reasonable cause—

a

revoke or vary the terms of their registration of any person or premises under this section; or

b

restrict the premises which are so registered.

7

As respects beer chargeable with a duty of excise that has not been paid, regulations under section 49 below may, without prejudice to the generality of that section, make provision—

a

regulating the holding or packaging of, or the carrying out of other operations on or in relation to, any such beer on registered premises without payment of the duty;

b

for securing and collecting the duty on any such beer held on registered premises;

c

permitting the removal of any such beer from registered premises without payment of duty in such circumstances and subject to such conditions as may be prescribed;

d

for such persons as may be prescribed to be liable to pay the duty on any such beer held on, or removed without payment of duty from, registered premises, and for the circumstances in which, and the time at which, they are liable to do so.

8

If any person contravenes or fails to comply with any condition of registration under this section he shall be liable on summary conviction to a penalty not exceeding level 5 on the standard scale; and any beer in respect of which the offence was committed shall be liable to forfeiture.

9

In this section—

  • “prescribed means specified in, or determined in accordance with, regulations made by the Commissioners under section 49 below;

  • “registered premises means premises registered under this section.

C13

For sections 47 and 48 of that Act (licences to brew beer and to use premises for adding solutions to beer) there shall be substituted—

47 Registration of producers of beer.

1

A person who produces beer on any premises in the United Kingdom must be registered with the Commissioners under this section in respect of those premises; and in this Act “registered brewer means a person registered under this section in respect of any premises.

2

A person who produces beer on any premises shall not be required to be registered under this section in respect of those premises if the beer is produced solely for his own domestic use or solely for the purposes of research or experiments in the production of beer.

3

An application for the registration under this section of any person required to be so registered in respect of any premises—

a

shall be made at least fourteen days before the day on which he begins production of beer on those premises; and

b

shall be in such form and manner as the Commissioners may by or under regulations prescribe.

4

If any person fails to apply for registration under this section in circumstances where he is required by subsection (3)(a) above to do so, he shall be liable on summary conviction to a penalty not exceeding level 4 on the standard scale; and any beer or worts produced in contravention of that provision shall be liable to forfeiture.

5

If any person produces beer on any premises in circumstances in which he is required to be, but is not, registered under this section in respect of those premises, he shall be liable on summary conviction to a penalty not exceeding level 5 on the standard scale; and any beer or worts in respect of which the offence was committed shall be liable to forfeiture.

4

The enactments and instruments mentioned in Schedule 2 to this Act shall have effect with the amendments specified in that Schedule.

P1C15

This section shall come into force on such day as the Commissioners may by order made by statutory instrument appoint, and different days may be so appointed for different provisions or for different purposes.

6

An order under subsection (5) above may contain such saving or transitional provision as the Commissioners think fit; and, without prejudice to the generality of the foregoing, any such order may include provision—

a

for treating beer—

i

produced, or in the process of being produced, before the relevant day, and

ii

held on, or in the process of being transported between, registered premises on that day,

as beer produced on or after that day and chargeable accordingly, and

b

for the remission or repayment of any duty charged or paid in respect thereof under provisions replaced by this section and Schedule 2 to this Act.

7

In this section—

  • “the Commissioners means the Commissioners of Customs and Excise;

  • “registered premises means—

a

premises which, on the relevant day, are registered under section 41A of the M6Alcoholic Liquor Duties Act 1979, or

b

premises in respect of which, on that day, a person is registered under section 47 of that Act;

“the relevant day means the day appointed for the coming into force of subsection (1) of the section 36 substituted by subsection (1) above.

F48 Vehicles excise duty: exemptions.

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F59

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F610

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Management

11 Revenue traders and registered excise dealers and shippers.

1

In section 1 of the M7Customs and Excise Management Act 1979 (interpretation) in subsection (1), after the definition of “Queen’s warehouse” there shall be inserted—

“registered excise dealer and shipper means a revenue trader approved and registered by the Commissioners under section 100G below;

“registered excise dealers and shippers regulations means regulations under section 100G below;

2

In the definition of “revenue trader” in that subsection, in paragraph (a) (person carrying on a trade or business subject to any of the revenue trade provisions of the customs and excise Acts) after the words “customs and excise Acts” there shall be inserted the words

or which consists of or includes—

i

the buying, selling, importation, exportation, dealing in or handling of any goods of a class or description which is subject to a duty of excise (whether or not duty is chargeable on the goods); or

ii

the financing or facilitation of any such transactions or activities,

3

Schedule 4 to this Act shall have effect.

12 Protection of the revenues derived from excise duties.

Schedule 5 to this Act (which makes provision for the purpose of protecting the revenues derived from duties of excise) shall have effect.

CHAPTER IIVALUE ADDED TAX

F713

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F814. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F915

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F1016

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F1117

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F1218

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CHAPTER IIICAR TAX

F17919 Vehicles leased to the handicapped.

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F18020 Research vehicles.

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Part IIINCOME TAX, CORPORATION TAX AND CAPITAL GAINS TAX

I6 CHAPTER I GENERAL

Annotations:
Commencement Information
I6

Chapter I partly in force at 4.5.1988 due to retrospective effect of s. 74(5)

Income tax rates and allowances

F19121 Charge and rates of income tax for 1991-92.

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F19222 Married couple’s allowance.

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Corporation tax rates

23 Rate of corporation tax for 1990.

1

The rate at which corporation tax is charged for the M8financial year 1990 shall be 34 per cent. (and not 35 per cent. as provided by section 19 of the Finance Act 1990).

2

For the financial year 1990 the fraction mentioned in section 13(2) of the Taxes Act 1988 (marginal relief for small companies) shall be nine four-hundredths (and not one fortieth as provided by section 20 of the Finance Act 1990).

3

All such adjustments shall be made, whether by way of discharge or repayment of tax or otherwise, as may be required in consequence of the provisions of this section.

24 Charge and rate of corporation tax for 1991.

Corporation tax shall be charged for the financial year 1991 at the rate of 33 per cent.

F22525 Small companies.

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Interest

26 Relief for interest.

For the year 1991-92 the qualifying maximum defined in section 367(5) of the Taxes Act 1988 (limit on relief for interest on certain loans) shall be £30,000.

27 Abolition of higher rate relief on certain mortgage interest etc.

F131

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F132

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F133

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F134

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F135

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F2436

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F137

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28 Mortgage interest relief: caravans.

1

Section 354(3) of the Taxes Act 1988 (interest eligible for relief in the case of a caravan only if the caravan is large or certain conditions presupposing domestic rating are met) shall cease to have effect.

2

This section shall have effect for the year 1991-92 and subsequent years of assessment.

Benefits in kind

29 Car benefits.

1

In Schedule 6 to the Taxes Act 1988 (taxation of directors and others in respect of cars) for Part I (tables of flat rate cash equivalents) there shall be substituted—

Part I TABLES OF FLAT RATE CASH EQUIVALENTS

TABLE A

Cars with an original market value up to £19,250 and having a cylinder capacity

Cylinder capacity of car in cubic centimetres

Age of car at end of relevant year of assessment

Under 4 years

4 years or more

1400 or less

£2,050

£1,400

More than 1400 but not more than 2000

£2,650

£1,800

More than 2000

£4,250

£2,850

TABLE B

Cars with an original market value up to £19,250 and not having a cylinder capacity

Original market vaue of car

Age of car at end of relevant year of assessment

Under 4 years

4 years or more

Less than £6,000

£2,050

£1,400

£6,000 or more but less than £8,500

£2,650

£1,800

£8,500 or more but not more than £19,250

£4,250

£2,850

TABLE C

Cars with an original market value of more than £19,250

Original market value of car

Age of car at end of relevant year of assessment

Under 4 years

4 years or more

More than £19,250 but not more than £29,000

£5,500

£3,700

More than £29,000

£8,900

£5,900

2

This section shall have effect for the year 1991-92 and subsequent years of assessment.

F1430. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F1531

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Vocational training

F1632 Relief.

1

This section applies where—

a

on or after 6th April 1992 an individual resident in the United Kingdom makes a payment in respect of a qualifying course of vocational training,

b

the payment is made in respect of an allowable expense,

c

the payment is made in connection with the individual’s own training,

F17ca

at the time the payment is made, the individual—

i

in a case where the qualifying course of vocational training is such a course by virtue only of paragraph (b) of subsection (10) below, has attained the age of thirty, or

ii

in any other case, has attained school-leaving age and, if under the age of nineteen, is not a person who is being provided with full-time education at a school,

F18cb

the individual undertakes the course neither wholly nor mainly for recreational purposes or as a leisure activity,

d

at the time the payment is made, the individual has not received in relation to the course, and is not entitled to receive in relation to it, any public financial assistance of a description specified in regulations made by the Treasury for the purposes of this paragraph, and

e

the individual is not entitled to claim any relief or deduction in respect of the payment under any other provision of the Income Tax Acts.

F192

The individual shall be entitled to relief under this subsection in respect of the payment for the year of assessment in which it is made; but relief under this subsection shall be given only on a claim made for the purpose, except where subsections (3) to (5) below apply.

F192A

Where an individual is entitled to relief under subsection (2) above in respect of any payment made in a year of assessment, the amount of his liability for that year to income tax on his total income shall be the amount to which he would be liable apart from this section less whichever is the smaller of—

a

the amount which is equal to such percentage of the amount of the payment as is the basic rate for the year; and

b

the amount which reduces his liability to nil.

F192B

In determining for the purposes of subsection (2A) above the amount of income tax to which a person would be liable apart from this section, no account shall be taken of—

a

any income tax reduction under Chapter I of Part VII of the Taxes Act 1988 or under section 347B of that Act;

b

any income tax reduction under section 353(1A) of the Taxes Act 1988;

c

any relief by way of a reduction of liability to tax which is given in accordance with any arrangements having effect by virtue of section 788 of the Taxes Act 1988 or by way of a credit under section 790(1) of that Act;

d

any tax at the basic rate on so much of that person’s income as is income the income tax on which he is entitled to charge against any other person or to deduct, retain or satisfy out of any payment.

3

In such cases and subject to such conditions as the Board may specify in regulations, relief under subsection (2) above shall be given in accordance with subsections (4) and (5) below.

4

An individual who is entitled to such relief in respect of a payment may deduct and retain out of it an amount equal to income tax on it at the basic rate for the year of assessment in which it is made.

5

The person to whom the payment is made—

a

shall accept the amount paid after deduction in discharge of the individual’s liability to the same extent as if the deduction had not been made, and

C2b

may, on making a claim F20in accordance with regulations, recover from the Board an amount equal to the amount deducted.

6

The Treasury may make regulations providing that in circumstances prescribed in the regulations—

a

an individual who makes, in respect of a qualifying course of vocational training, a payment in respect of an allowable expense shall cease to be and be treated as not having been entitled to relief under subsection (2) above in respect of the payment or such part of it as may be determined in accordance with the regulations; and

b

he or the person to whom the payment was made (depending on the terms of the regulations) shall account to the Board for tax from which relief has been given on the basis that the individual was so entitled.

7

Regulations under subsection (6) above may include provision adapting or modifying the effect of any enactment relating to income tax in order to secure the performance of any obligation imposed under paragraph (b) of that subsection.

8

In subsection (1)(a) above, the reference to an individual resident in the United Kingdom includes an individual performing duties which are treated by virtue of section 132(4)(a) of the Taxes Act 1988 as performed in the United Kingdom.

9

For the purposes of this section, a payment made in respect of a qualifying course of vocational training is made in respect of an allowable expense if—

a

it is made in respect of fees payable in connection with undertaking the course, including fees payable for assessment purposes, or

b

it is made in respect of fees payable in connection with the making, as a result of having undertaken the course, of any entry in an official register or any award.

F2110

In this section “qualifying course of vocational training means—

a

any programme of activity capable of counting towards a qualification—

F22i

accredited as a National Vocational Qualification by the Qualifications and Curriculum Authority or by the Qualifications, Curriculum and Assessment Authority for Wales, or

ii

accredited as a Scottish Vocational Qualification by the F23Scottish Qualifications Authority; or

b

any course of training which—

i

satisfies the conditions set out in the paragraphs of section 589(1) of the Taxes Act 1988 (qualifying courses of training etc),

ii

requires participation on a full-time or substantially full-time basis, and

iii

extends for a period which consists of or includes four consecutive weeks,

but treating any time devoted to study in connection with the course as time devoted to the practical application of skills or knowledge.

F2411

In this section—

  • “school means any institution at which full-time education is provided to persons at least some of whom are under school-leaving age; and

  • “school-leaving age means the age of sixteen.

F2533 Section 32: supplementary.

1

The Board may by regulations—

a

provide that a claim under section 32(2) or (5)(b) above shall be made in such form and manner, shall be made at such time, and shall be accompanied by such documents, as may be prescribed;

F26aa

make provision for and with respect to appeals against a decision of an officer of the Board or the Board with respect to a claim under section 32(5)(b) above;

b

make provision, in relation to payments in respect of which a person is entitled to relief under section 32 above, for persons who provide vocational training courses to give, in such circumstances as may be prescribed, certificates of payment in such form as may be prescribed to such persons as may be prescribed;

c

provide that a person who provides (or has at any time provided) training courses which are (or were) qualifying courses of vocational training for the purposes of section 32 above shall comply with any notice which is served on him by the Board and which requires him within a prescribed period to make available for the Board’s inspection documents (of a prescribed kind) relating to such courses;

d

provide that persons of such description as may be prescribed shall, within a prescribed period of being required to do so by the Board, furnish to the Board information (of a prescribed kind) about training courses which are qualifying courses of vocational training for the purposes of section 32 above;

e

make provision generally as to administration in connection with section 32 above.

F2202

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3

The following provisions of the M9Taxes Management Act 1970, namely—

F27a

section 29(1)(c) (excessive relief) as it has effect apart from section 29(2) to (10) of that Act;

b

section 30 (tax repaid in error etc.) F28apart from subsection (1B),

c

F29section 86 (interest), and

d

section 95 (incorrect return or accounts),

F30shall apply in relation to an amount which is paid to any person by the Board as an amount recoverable by virtue of section 32(5)(b) above but to which that person is not entitled as if it were income tax which ought not to have been repaid and, where that amount was claimed by that person, as if it had been repaid as respects a chargeable period as a relief which was not due.

C3F313A

In the application of section 86 of the Taxes Management Act 1970 by virtue of subsection (3) above in relation to sums due and payable by virtue of an assessment made under section 29(1)(c) or 30 of that Act, as applied by that subsection, the relevant date—

a

in a case where the person falling within section 32(5) above has made any interim claim, within the meaning of regulations made under subsection (1) above, as respects some part of the year of assessment for which the assessment is made, is 1st January in that year of assessment; and

b

in any other case, is the later of the following dates, that is to say—

i

1st January in the year of assessment for which the assessment is made; or

ii

the date of the making of the payment by the Board which gives rise to the assessment.

4

In sections F32. . . 257D(8) and 265(3) of the Taxes Act 1988, after paragraph (d) there shall be inserted

, or

e

on account of any payments to which section 32(4) of the Finance Act 1991 applies.

5

In subsection (1) above, “prescribed means prescribed by or, in relation to form, under the regulations.

Retirement benefits schemes

F19034 Conditions for approval: amendments.

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F19035 Cessation of approval.

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F19036 Cessation of approval: general provisions.

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Profit-related pay, share schemes etc.

F3337

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38 Employee share schemes: non-discrimination.

1

The Taxes Act 1988 shall be amended as follows.

F1702

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3

In Schedule 10 (further provisions relating to profit sharing schemes) in sub-paragraph (b) of paragraph 2 and in sub-paragraph (c)(ii) of paragraph 3 for “pensionable age” there shall be substituted “the relevant age ”, and at the end of each of those paragraphs there shall be inserted—

In this paragraph, the reference to the relevant age is a reference, in the case of a scheme approved before the day on which the Finance Act 1991 was passed, to pensionable age and, in the case of a scheme approved on or after that day, to the specified age.

4

In section 187(2) (definitions for the purposes of provisions relating to employee share schemes) after the definition of “shares” there shall be inserted—

“specified age,in relation to a scheme, means the age specified in pursuance of paragraph 8A of Schedule 9 as the specified age for the purposes of the scheme;

5

In Part II of Schedule 9 (requirements generally applicable to employee share schemes) after paragraph 8 there shall be inserted—

8A

1

In the case of a savings-related share option scheme or a profit sharing scheme, the scheme must specify what age is to be the specified age for the purposes of the scheme.

2

The age specified—

a

must be the same for men and women, and

b

must be not less than 60 and not more than 75.

6

F171Subsection (5) above shall have effect in relation to a scheme not approved before the day on which this Act is passed.

F16939 Approved share option schemes: price at which shares may be acquired.

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

F16940 Savings-related share option schemes.

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

41 Profit sharing schemes.

1

In section 187(2) of the Taxes Act 1988, in the definition of “relevant amount” (limit on the value of shares that may be appropriated to a participant in a year of assessment) for “not less than £2,000 and not more than £6,000” there shall be substituted “not less than £3,000 and not more than £8,000 ”.

2

This section shall apply for the year 1991-92 and subsequent years of assessment.

F22642 Costs of establishing share option or profit sharing schemes: relief.

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

F21643 Costs of establishing employee share ownership trusts: relief.

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

F17244 Priority share allocations for employees etc.

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

Foreign earnings

F3445

  • . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F24446 Workers in Kuwait or Iraq.

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

Insurance companies and friendly societies

F18147 Investor protection schemes.

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

48 Assimilation of basic life assurance business and general annuity business.

Schedule 7 to this Act shall have effect.

F3549. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

50 Friendly societies.

Schedule 9 to this Act (which makes provision about friendly societies) shall have effect.

Building societies

51 Qualifying shares.

Schedule 10 to this Act (which makes provision about certain kinds of building society share) shall have effect.

52 Marketable securities.

1

Schedule 11 to this Act (which makes provision about the deduction of income tax in the case of marketable securities issued by building societies) shall have effect.

F362

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

F363

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

F19353 Income Tax (Building Societies) Regulations 1986.

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

Securities

54 New issues.

Schedule 12 to this Act (which contains provisions about securities issued after an issue of securities of the same kind) shall have effect.

F21355 Purchase and sale of securities: options.

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

F3756

  • . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F3857. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

I558 Manufactured dividends and interest.

1

After section 736 of the Taxes Act 1988 there shall be inserted—

736A Manufactured dividends and interest.

Schedule 23A to this Act shall have effect in relation to certain cases where under a contract or other arrangements for the transfer of shares or other securities a person is required to pay to the other party an amount representative of a dividend or payment of interest on the securities.

2

The enactments mentioned in Schedule 13 to this Act shall have effect with the amendments there specified.

P23

This section shall have effect in relation to payments made on or after such day as the Treasury may specify for this purpose by regulations made by statutory instrument and different days may be so appointed for different provisions or different purposes.

Annotations:
Commencement Information
I5

S. 58: s. 58 came into force at Royal Assent (25.7.1991) with effect as mentioned in s. 58(3) in relation to payments made on or after such day or days as the Treasury may specify:

26.2.1992 appointed for specified provisions and purposes by S.I. 1992/173, reg. 2.

30.6.1992 appointed for specified provisions and purposes by S.I. 1992/1346, regs. 2-4.

22.4.1993 appointed for specified provisions and purposes by S.I. 1993/933, regs. 2-4.

Subordinate Legislation Made
P2

S. 58(3) power partly exercised (4.2.1992): 26.2.1992 appointed day for specified provisions and purposes by S.I. 1992/173

S. 58(3) power partly exercised (5.6.1992): 30.6.1992 appointed day for specified provisions and purposes by S.I. 1992/1346

S. 58(3) power partly exercised (21.4.1993): 22.4.1993 appointed day for specified provisions and purposes by S.I. 1993/933.

Capital allowances

F3959. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F4060. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F4161. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Oil industry

F22262 Expenditure on and under abandonment guarantees.

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

F22263 Relief for reimbursement expenditure under abandonment guarantees.

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

F22264 Relief for expenditure incurred by a participator in meeting defaulter’s abandonment expenditure.

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

F22265 Reimbursement by defaulter in respect of certain abandonment expenditure.

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

F24566 Restriction on setting ACT against liability to corporation tax on profits from oil extraction activities etc.

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

F4267. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Miscellaneous

F21768 Gifts to educational establishments.

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

F17369 Expenses of entertainers.

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

F18570 Personal equity plans.

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

71 Donations to charity.

1

Section 339A of the Taxes Act 1988 (maximum qualifying donations in the case of companies) shall cease to have effect.

F2272

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

3

Subsections (1) and (2) above shall apply in relation to accounting periods beginning on or after 19th March 1991.

4

In its application to accounting periods beginning before 19th March 1991 and ending on or after that date, section 339A of the Taxes Act 1988 shall have effect as if—

a

in subsections (1) and (2), after the words “in that period”, in the first place where they occur, there were inserted “and before 19th March 1991”; and

b

in subsection (3)(b), after “that section” there were inserted “in respect of payments made before 19th March 1991”.

5

In section 25 of the M10Finance Act 1990 (donations to charity by individuals) subsection (2)(h) (maximum qualifying donations) shall cease to have effect.

6

Subsection (5) above shall apply in relation to gifts made on or after 19th March 1991.

F19472 Deduction of trading losses.

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

73 Relief for company trading losses.

F2281

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

2

Sections 393(2) to (6) and 394 of the Taxes Act 1988 (which are superseded by this section) shall cease to have effect.

3

Schedule 15 to this Act shall have effect.

4

This section shall have effect only in relation to losses incurred in accounting periods ending on or after 1st April 1991.

5

Any enactment amended by this section or that Schedule shall, in its application in relation to losses so incurred, be deemed to have had effect at all times with that amendment; and where any such enactment is the re-enactment of a repealed enactment, the repealed enactment shall, in its application in relation to losses so incurred, be deemed to have had effect at all times with a corresponding amendment.

F22974 Trade unions and employers’ associations.

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

F24675 Audit powers in relation to non-residents.

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

76 Capital element in annuities.

F2141

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

2

Section 230 of the M11Income and Corporation Taxes Act 1970 (from which section 656 of the Taxes Act 1988 is derived) shall be deemed always to have had effect as if the subsections (7) to (9) set out in subsection (1) above had been contained in that section as subsections (8) to (10) respectively, but with the substitution for “(2)(a)” and “(4)(c)”, in each place where they occur, of “(2A)(a) ” and “(3)(c) ” respectively.

3

Section 27 of the M12Finance Act 1956 (from which section 230 of the Income and Corporation Taxes Act 1970 was derived) shall be deemed always to have had effect as if the subsections (7) and (9) set out in subsection (1) above had been contained in that section as subsections (8A) and (8B) respectively, but with the omission in subsection (7) of paragraph (a) and with the substitution of “(3)(c) ” for “(4)(c)” in both places where it occurs.

77 Definition of “normal commercial loan”.

1

In paragraph 1 of Schedule 18 to the Taxes Act 1988 (under which a person who is a loan creditor of a company in respect of a non-commercial loan is an equity holder of the company) after sub-paragraph (5D) there shall be inserted—

5E

For the purposes of sub-paragraph (5)(b) above, the amount to which the loan creditor is entitled by way of interest—

a

shall not be treated as depending to any extent on the results of the company’s business or any part of it by reason only of the fact that the terms of the loan provide for the rate of interest to be reduced in the event of the results of the company’s business or any part of it improving, and

b

shall not be treated as depending to any extent on the value of any of the company’s assets by reason only of the fact that the terms of the loan provide for the rate of interest to be reduced in the event of the value of any of the company’s assets increasing.

5F

Sub-paragraph (5H) below applies where—

a

a person makes a loan to a company on the basis mentioned in sub-paragraph (5G) below for the purpose of facilitating the acquisition of land, and

b

none of the land which the loan is used to acquire is acquired with a view to resale at a profit.

5G

The basis referred to above is that—

a

the whole of the loan is to be applied in the acquisition of land by the company or in meeting the incidental costs of obtaining the loan,

b

the payment of any amount due in connection with the loan to the person making it is to be secured on the land which the loan is to be used to acquire, and

c

no other security is to be required for the payment of any such amount.

5H

For the purposes of sub-paragraph (5)(b) above, the amount to which the loan creditor is entitled by way of interest shall not be treated as depending to any extent on the value of any of the company’s assets by reason only of the fact that the terms of the loan are such that the only way the loan creditor can enforce payment of an amount due is by exercising rights granted by way of security over the land which the loan is used to acquire.

5I

In sub-paragraph (5G)(a) above the reference to the incidental costs of obtaining the loan is to any expenditure on fees, commissions, advertising, printing or other incidental matters wholly and exclusively incurred for the purpose of obtaining the loan or of providing security for it.

F432

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

3

Except as provided by subsection (2) above, this section shall be deemed to have come into force on 1st April 1991.

78 Sharing of transmission facilities.

1

This section applies to any agreement relating to the sharing of transmission facilities—

a

to which the parties are national broadcasting companies,

b

which is entered into on or after the day on which this Act is passed and before 1st January 1992 or such later date as may be specified for the purposes of this paragraph by the Secretary of State, and

c

in relation to which the Secretary of State has certified that it is expedient that this section should apply.

F442

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

F443

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

4

Where under an agreement to which this section applies one party to the agreement disposes of F45plant or machinery to another party to the agreement, the F46Capital Allowances Act shall apply—

a

in the case of the party making the disposal, as if the disposal value of the F45plant or machinery for the purposes of F47section 60 of that Act were equal to the capital expenditure incurred by that party on its provision, and

b

in the case of the party to whom the disposal is made, as if the amount expended by that party in acquiring the F45plant or machinery were equal to the capital expenditure so incurred.

5

In subsection (4) above, references to F48plant or machinery include a share in F48plant or machinery.

F446

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

F447

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

8

In this section, “national broadcasting company means a body corporate engaged in the broadcasting for general reception by means of wireless telegraphy of radio or television services or both on a national basis.

79 Abolition of CRT: consequential amendment.

1

In Schedule 12 to the Finance Act 1988 (building societies: change of status) in paragraph 6(1)(b) for “section 476” there shall be substituted “section 477A ”.

2

This section shall apply where qualifying benefits are conferred on or after 6th April 1991.

80 Interest on certain debentures.

Paragraph 8(2) of Schedule 11 to the M13Electricity Act 1989 (treatment of certain debentures for the purposes of the Corporation Tax Acts) shall have effect, and be deemed always to have had effect, with the addition after paragraph (b) of the words—

“ and if any such debenture includes provision for the payment of a sum expressed as interest in respect of a period which falls wholly or partly before the issue of the debenture, any payment made in pursuance of that provision in respect of that period shall be treated for the purposes of the Corporation Tax Acts as if the debenture had been issued at the commencement of that period and, accordingly, as interest on the principal sum payable under the debenture. ”

F4981. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Annotations:
Amendments (Textual)
F49

S. 81 repealed (1.5.1995 for the purposes mentioned in Sch. 29 Pt.VIII(16) Note 5 of the amending Act) by 1995 c. 4, s. 162, Sch. 29 Pt. VIII Note 5

82 Certificates of non-liability to tax.

1

In the M14Taxes Management Act 1970, the following section shall be inserted after section 99—

99A Certificates of non-liability to income tax.

If a person who gives a certificate of non-liability to income tax in pursuance of regulations under section 477A of the principal Act (building societies) or section 480B of that Act (deposit-takers)—

a

gives the certificate fraudulently or negligently, or

b

fails to comply with any undertaking contained in the certificate in pursuance of the regulations,

he shall be liable to a penalty not exceeding £3,000.

2

So far as relating to the giving of a certificate, this section shall apply in relation to certificates given on or after the day on which this Act is passed.

3

So far as relating to failure to comply with an undertaking contained in a certificate, this section shall apply in relation to certificates whenever given, but not so as to impose liability for a failure occurring before the day on which this Act is passed.

I7CHAPTER II CAPITAL GAINS

Annotations:
Commencement Information
I7

Chapter II partly in force at 1.12.1988 due to retrospective effect of ss. 95 & 96

Settlements

F5083. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F5184. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F5285. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F5386. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F5487. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F5588. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F5689. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F5790. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F5891. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F5992. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Private residence

F6093. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F6194. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Miscellaneous

F6295. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F6396. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F6497. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F6598. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F6699. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F67100. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F68101. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F69102. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Part III OIL TAXATION

Abandonment etc.

103 Allowance of certain expenditure relating to abandonment, decommissioning assets, etc.

1

Section 3 of the principal Act (allowance of certain expenditure) shall be amended in accordance with subsections (2) to (6) below.

2

With respect to expenditure incurred on or after 19th March 1991, in subsection (1), after paragraph (h) there shall be inserted the following paragraph—

hh

obtaining an abandonment guarantee, as defined in section 104 of the Finance Act 1991

3

With respect to expenditure incurred after 30th June 1991, in subsection (1), for paragraph (i) there shall be substituted the following paragraphs—

i

closing down, decommissioning, abandoning or wholly or partially dismantling or removing any qualifying asset;

j

carrying out qualifying restoration work consequential upon the closing down of the field or any part of it.

4

After subsection (1) there shall be inserted the following subsections—

1A

In this section “qualifying asset has the same meaning as in the Oil Taxation Act 1983; and, in the case of a qualifying asset which was leased or hired, the reference in subsection (1)(i) above to decommissioning includes a reference to carrying out any restoration or similar work which is required to be carried out to comply with the terms of the contract of lease or hire.

1B

In subsection (1)(j) above “qualifying restoration work, in relation to a participator in an oil field, means—

a

restoring (including landscaping) land on which a qualifying asset is or was situated; or

b

restoring the seabed (including the subsoil thereof) on which a qualifying asset is or was situated.

1C

In any case where—

a

expenditure is incurred by a participator for any of the purposes mentioned in paragraph (i) or paragraph (j) of subsection (1) above, and

b

the participator is or was a participator in two or more oil fields and the qualifying asset which is relevant to the incurring of that expenditure is, at the end of the claim period concerned, a qualifying asset in respect of more than one of those oil fields,

the expenditure shall be apportioned between those oil fields in such manner as is just and reasonable.

1D

Without prejudice to any apportionment under subsection (1C) above, in any case where—

a

any expenditure incurred by a participator would, apart from this subsection, be regarded as wholly incurred for any of the purposes mentioned in paragraph (i) or paragraph (j) of subsection (1) above, and

b

the qualifying asset which is relevant to the incurring of that expenditure has at some time been used otherwise than in connection with an oil field,

only such portion of the expenditure as it is just and reasonable to apportion to the use in connection with an oil field shall be regarded as allowable for any of the purposes referred to in paragraph (a) above.

5

After subsection (5A) there shall be inserted the following subsection—

5B

Expenditure incurred by a participator in an oil field shall be taken to be incurred for the purpose mentioned in paragraph (hh) of subsection (1) above if, and only if,—

a

it consists of fees, commission or incidental costs incurred wholly and exclusively for the purposes of obtaining an abandonment guarantee; and

b

the abandonment guarantee is obtained in order to comply with a term of a relevant agreement relating to that field under which the participator is required to provide security (whether or not specifically in the form of an abandonment guarantee) in respect of his liabilities to contribute to field abandonment costs;

and expressions used in this subsection shall be construed in accordance with section 104 of the Finance Act 1991.

6

In subsection (6) (apportionment of expenditure)—

a

at the beginning there shall be inserted “Without prejudice to any apportionment under subsection (1C) or subsection (1D) above ”; and

b

after the words “subsections (1) and (5) above” there shall be inserted “other than paragraph (hh) of subsection (1) ”.

7

In section 10 of the principal Act (exempt gas)—

a

in subsection (2) for the words “and (i) of subsection (1)” there shall be substituted “(hh), (i) and (j) of subsection (1) and subsection (1D) ”;

F70b

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

F70c

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

8

So far as they relate to the paragraph (hh) inserted by subsection (2) above, the amendments in subsections (5) to (7) above have effect with respect to expenditure incurred on or after 19th March 1991 and, subject to that, the amendments in subsections (4) to (7) above have effect with respect to expenditure incurred after 30th June 1991.

104 Abandonment guarantees.

1

Subject to subsection (2) below, for the purposes of section 3 of the principal Act F253..., an abandonment guarantee is a contract under which a person ( “the guarantor) undertakes to make good any default by a participator in an oil field ( “the relevant participator) in meeting the whole or any part of those liabilities of his which—

a

arise under a relevant agreement relating to that field; and

b

are liabilities to contribute to field abandonment costs;

and such a contract is an abandonment guarantee regardless of the form of the undertaking of the guarantor and, in particular, whether or not it is expressed as a guarantee or arises under a letter of credit, a performance bond or any other instrument.

2

For the purposes of section 3 of the principal Act F254... a contract is not an abandonment guarantee—

a

unless it is entered into in good faith and on terms reasonably appropriate to the nature and extent of the guarantee; or

b

if the guarantor undertakes any liability beyond that of making good any such default as is referred to in subsection (1) above; or

c

if it can be revoked by the guarantor otherwise than on account of some fraud, misrepresentation or other fault on the part of the relevant participator occurring prior to the making of the contract; or

d

if, subject to subsection (3) below, the guarantor is, or is a person connected with, a participator in one or more oil fields.

3

Paragraph (d) of subsection (2) above does not apply if—

a

the main business carried on by the guarantor is such that it is in the ordinary course of that business to provide guarantees; and

b

the relevant participator is not connected with the guarantor;

and F230section 1122 of the Corporation Tax Act 2010 (connected persons) applies for the purposes of this subsection and subsection (2) above.

4

Without prejudice to the generality of paragraph (a) of subsection (2) above, a contract shall not be regarded as entered into in good faith if, as a result of any arrangement, the liability to make good any such default as is referred to in subsection (1) above will be met, directly or indirectly, by such a person that, if he were the guarantor under the contract, the contract could not be an abandonment guarantee by virtue of paragraph (d) of subsection (2) above.

5

In this section and in section 3(5B) of the principal Act—

a

in relation to an oil field, a “relevant agreement means a joint operating agreement, a unitisation agreement (within the meaning of paragraph 1(1) of Schedule 17 to the M15Finance Act 1980) or an agreement entered into by some or all of the parties to a joint operating agreement or such a unitisation agreement; and

b

in relation to an oil field, “field abandoNment costs means costs incurred in closing down the field or any part of it, together with any costs incurred in discharging any continuing liabilities resulting directly from that closure.

F255105 Restriction of expenditure relief by reference to payments under abandonment guarantees.

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

F256106 Relief for reimbursement expenditure under abandonment guarantees.

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

107 Allowance of expenditure of participator meeting defaulter’s field abandonment expenditure.

1

In Schedule 5 to the principal Act (procedure for allowance of expenditure) at the beginning of paragraph (b) of sub-paragraph (4) of paragraph 2 (claim must state the shares, by reference to their respective interests in the oil field, in which participators propose to divide expenditure) there shall be inserted “Subject to paragraph 2A below ”.

2

After paragraph 2 of Schedule 5 to the principal Act there shall be inserted the following paragraph—

2A

1

This paragraph applies where—

a

a claim is made under this Schedule for the allowance of any expenditure which is incurred after 30th June 1991 and is allowable for an oil field by virtue of paragraph (i) or paragraph (j) of subsection (1) of section 3 of this Act (in this paragraph referred to as “the abandonment expenditure);

b

a participator (in this paragraph referred to as “the defaulter) has defaulted on his liability under a relevant agreement to make a payment towards the abandonment expenditure;

c

at the end of the claim period for which the claim is made, the defaulter still has an interest in the oil field which falls to be taken into account in determining, under paragraph 2(4)(b) above, the shares of each of the participators in the abandonment expenditure;

d

the participators (other than any who have defaulted as mentioned in paragraph (b) above) have taken all reasonable steps by way of legal remedy to secure that the defaulter meets the whole of the liability referred to in paragraph (b) above and to enforce any guarantee or other security provided in respect of that liability; and

e

one or more of those participators has paid an amount in or towards meeting the whole or any part of the payment for which the defaulter was liable as mentioned in paragraph (b) above.

2

For the purposes of this paragraph, a participator is to be regarded as defaulting on his liability to make a payment as mentioned in sub-paragraph (1)(b) above if he has failed to make the payment in full on the date on which it becomes due under the relevant agreement and either—

a

on the sixtieth day after that due date any of the payment remains unpaid; or

b

before that sixtieth day the participator’s interest in a relevant licence becomes liable under the relevant agreement to be sold or forfeited, in whole or in part, by reason of his failure to meet his liability.

3

In this paragraph—

a

“relevant agreement has the meaning given by section 104(5)(a) of the Finance Act 1991;

b

“the sum in default means so much of the payment referred to in sub-paragraph (1)(b) above as has neither been paid by the defaulter nor met by virtue of any such guarantee or security as is referred to in sub-paragraph (1)(d) above;

c

the “default payment means the amount which the qualifying participator has paid as mentioned in sub-paragraph (1)(e) above; and

d

a “qualifying participator means a participator who falls within sub-paragraph (1)(e) above and who is not connected with the defaulter, applying section 839 of the Taxes Act (connected persons) for the purposes of this paragraph.

4

For the purposes of paragraphs 2(4)(b) and 3(1)(c) of this Schedule, there shall be attributed to a qualifying participator (as an addition to the share of the abandonment expenditure referable to his own interest in the oil field) whichever is the less of—

a

the default payment; and

b

subject to sub-paragraph (5) below, that portion of the sum in default which, in accordance with the relevant agreement, the qualifying participator is required to meet in the event of a failure by the defaulter to meet his liability to pay in full the payment referred to in sub-paragraph (1)(b) above.

5

If, in the case of any oil field, there are only two participators and one of them is the defaulter, the portion referred to in sub-paragraph (4)(b) above is the whole.

6

Where this paragraph applies, account shall, in the first instance, be taken under paragraph 2(4)(b) above of the whole of the defaulter’s interest in the oil field in determining the share of the abandonment expenditure which, apart from sub-paragraph (4) above, is to be attributed to each of the other participators; but the amount of the abandonment expenditure which, apart from this paragraph, would be attributed to the defaulter by reference to his interest in the oil field shall be reduced (or, as the case may be, extinguished) by deducting therefrom any expenditure attributed to the other participators under sub-paragraph (4) above.

F257108 Reimbursement by defaulter in respect of certain abandonment expenditure.

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

Penalties

109 PRT: proceedings for penalties.

1

In Schedule 2 to the principal Act (management and collection of petroleum revenue tax) the Table in paragraph 1(1) shall be amended as follows.

2

The following shall be substituted for the entries relating to section 100 of the M16Taxes Management Act 1970—

Section 100C(1)

For the words from “General” to the end substitute “Special Commissioners for any penalty”.

(2)

Before “Commissioners” insert “Special”.

(3)

Before “Commissioners” insert “Special”.

(4)

(5)

3

The following shall be substituted for the entries relating to section 103 of the M17Taxes Management Act 1970—

Section 103(1)

For the words from the beginning to “court—” substitute “Where the amount of a penalty is to be ascertained by reference to tax payable by a person for any period, proceedings for the penalty may be commenced before the Special Commissioners—”.

(4)

For the words from the beginning to “court,” substitute “Proceedings for a penalty to which subsection (1) above does not apply may be commenced before the Special Commissioners”.

Part IVSTAMP DUTY AND STAMP DUTY RESERVE TAX

110 Stamp duty abolished in certain cases.

F711

Where apart from this section stamp duty under any of the provisions of Schedule 13 to the Finance Act 1999 would be chargeable on an instrument, stamp duty shall not be so chargeable if the property consists entirely of exempt property.

5

For the purposes of this section exempt property is property other than—

a

land,

F72b

an interest in the proceeds of the sale of land held on trust for sale, or

c

a licence to occupy land.

6

This section applies to—

a

an instrument executed in pursuance of a contract made on or after the abolition day;

b

an instrument which is not executed in pursuance of a contract and is executed on or after the abolition day.

7

For the purposes of this section the abolition day is such day as may be appointed under section 111(1) of the M18Finance Act 1990 (abolition of stamp duty for securities etc).

111 Stamp duty reduced in certain cases.

1

This section applies where—

a

stamp duty under F73Part I of Schedule 13 to the Finance Act 1999 (conveyance or transfer on sale) is chargeable on an instrument to which this section applies, and

b

part of the property concerned consists of exempt property.

2

In such a case—

a

the consideration in respect of which duty would be charged (apart from this section) shall be apportioned, on such basis as is just and reasonable, as between the part of the property which consists of exempt property and the part which does not, and

b

the instrument shall be charged only in respect of the consideration attributed to such of the property as is not exempt property.

3

In this section “exempt property has the same meaning as in section 110 above.

4

This section applies to—

a

an instrument executed in pursuance of a contract made on or after the abolition day;

b

an instrument which is not executed in pursuance of a contract and is executed on or after the abolition day.

5

In this section “the abolition day has the same meaning as in section 110 above.

112 Apportionment of consideration for stamp duty purposes.

1

Subsection (2) below applies where part of the property referred to in section 58(1) of the Stamp Act 1891 (consideration to be apportioned between different instruments as parties think fit) consists of exempt property.

2

Section 58(1) shall have effect as if “the parties think fit” read “is just and reasonable”.

3

Subsection (4) below applies where—

a

part of the property referred to in section 58(2) of the Stamp Act 1891 (property contracted to be purchased by two or more persons etc.) consists of exempt property, and

b

both or (as the case may be) all the relevant persons are connected with one another.

4

Section 58(2) shall have effect as if the words from “for distinct parts of the consideration” to the end of the subsection read “, the consideration is to be apportioned in such manner as is just and reasonable, so that a distinct consideration for each separate part or parcel is set forth in the conveyance relating thereto, and such conveyance is to be charged withad valoremduty in respect of such distinct consideration.”

5

In a case where subsection (2) or (4) above applies and the consideration is apportioned in a manner that is not just and reasonable, the enactments relating to stamp duty shall have effect as if—

a

the consideration had been apportioned in a manner that is just and reasonable, and

b

the amount of any distinct consideration set forth in any conveyance relating to a separate part or parcel of property were such amount as is found by a just and reasonable apportionment (and not the amount actually set forth).

6

In this section “exempt property has the same meaning as in section 110 above.

7

For the purposes of subsection (3) above—

a

a person is a relevant person if he is a person by or for whom the property is contracted to be purchased;

b

the question whether persons are connected with one another shall be determined in accordance with F231section 1122 of the Corporation Tax Act 2010.

8

This section applies where the contract concerned is made on or after the abolition day.

9

In this section “the abolition day has the same meaning as in section 110 above.

113 Certification of instruments for stamp duty purposes.

F741

For the purposes of paragraph 6(1) of Schedule 13 to the Finance Act 1999 (meaning of instrument being certified at an amount)—

a

a sale or contract or agreement for the sale of exempt property within the meaning of section 110 above shall be disregarded; and

b

any statement as mentioned in that provision shall be construed as leaving out of account any matter which is to be so disregarded.

4

This section applies to—

a

an instrument executed in pursuance of a contract made on or after the abolition day;

b

an instrument which is not executed in pursuance of a contract and is executed on or after the abolition day.

5

In this section “the abolition day has the same meaning as in section 110 above.

114 Acquisition under statute: exempt property.

1

Section 36 of the M19Finance Act 1949 and section 9 of the M20Finance Act (Northern Ireland) 1949 shall be amended as mentioned in subsections (2) and (3) below.

2

In subsection (4) of each of those sections (goods not affected by section 12 of the M21Finance Act 1895, which relates to duty on property acquired under statute) for the words “goods, wares or merchandise” (in each place where they occur) there shall be substituted the words “exempt property ”.

3

In each of those sections the following subsection shall be inserted after subsection (4)—

5

In subsection (4) above “exempt property has the same meaning as in section 110 of the Finance Act 1991.

4

This section applies where the Act mentioned in section 12 of the Finance Act 1895, and by virtue of which property is vested or a person is authorised to purchase property, is passed on or after the abolition day.

5

In this section “the abolition day has the same meaning as in section 110 above.

F75115. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

116 Investment exchanges and clearing houses: stamp duty.

1

The Treasury may make regulations providing as mentioned in this section with regard to any circumstances which—

a

would (apart from the regulations) give rise to a charge to stamp duty,

F248b

involve a prescribed relevant entity, or a member or nominee (or member or nominee of a prescribed description) of such a relevant entity, or a nominee (or nominee of a prescribed description) of a member of such a relevant entity, and

c

are such as are prescribed.

2

The regulations may provide that the charge to stamp duty shall be treated as not arising or (depending on the terms of the regulations) as reduced.

3

Regulations under this section—

a

shall be made by statutory instrument subject to annulment in pursuance of a resolution of the House of Commons;

b

may include such supplementary, incidental, consequential or transitional provisions as appear to the Treasury to be necessary or expedient;

c

may make different provision for different circumstances;

d

may make any provision in such way as the Treasury think fit (whether by amending enactments or otherwise).

4

In this section—

F204aa

“the Directive” means F259Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments, as amended from time to time,

a

“prescribed means prescribed by the regulations, F249and

F250b

“relevant entity” means any of the following—

i

a regulated market and a multilateral trading facility (within the meaning of the Directive);

ii

a recognised clearing house, a recognised investment exchange, an EEA central counterparty and a third country central counterparty (within the meaning of section 285 of the Financial Services and Markets Act 2000).

117 Investment exchanges and clearing houses: SDRT.

1

The Treasury may make regulations providing as mentioned in this section with regard to any circumstances which—

a

would (apart from the regulations) give rise to a charge to stamp duty reserve tax,

F251b

involve a prescribed relevant entity, or a member or nominee (or member or nominee of a prescribed description) of such a relevant entity, or a nominee (or nominee of a prescribed description) of a member of such a relevant entity, and

c

are such as are prescribed.

2

The regulations may provide that the charge to stamp duty reserve tax shall be treated as not arising or (depending on the terms of the regulations) as reduced.

3

Subsections (3) and (4) of section 116 above shall apply for the purposes of this section as they apply for the purposes of that.

Part V MISCELLANEOUS AND GENERAL

Miscellaneous

118 Designated international organisations: miscellaneous exemptions.

F1951

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

2

In section 828(4) of that Act (Treasury orders not subject to annulment in pursuance of a resolution of the House of Commons) after “377(8),” there shall be inserted “582A(1), ”.

119 Trading funds.

1

The M22Government Trading Funds Act 1973 shall be amended as follows.

2

In section 2 (assets and liabilities of funds) in subsections (1)(b) and (2) the words “at values or amounts determined by him in accordance with Treasury directions” shall be omitted.

3

In that section, the following subsection shall be inserted after subsection (2)—

2A

The values or amounts of assets and liabilities which are the subject of provision under subsection (1) or (2) above shall be determined by the responsible Minister in accordance with Treasury directions.

F182120 National savings: date of issue of repayment warrants etc.

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

F252121 Pools payments to support games etc.

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

General

122 Interpretation etc.

1

In this Act “the Taxes Act 1988 means the M23Income and Corporation Taxes Act 1988.

2

Part II of this Act, so far as it relates to capital gains tax, shall be construed as one with the M24Capital Gains Tax Act 1979.

3

Part III of this Act shall be construed as one with Part I of the M25Oil Taxation Act 1975 and in that Part of this Act “the principal Act means that Act.

123 Repeals.

The enactments specified in Schedule 19 to this Act (which include certain provisions which are already spent) 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.

124 Short title.

This Act may be cited as the Finance Act 1991.

SCHEDULES

SCHEDULE 1

Section 1.

TABLE OF RATES OF DUTY ON WINE AND MADE-WINE

Description of wine or made-wine

Rates of duty per hectolitre

£

Wine or made-wine of a strength not exceeding 2 per cent.

12.06

Wine or made-wine of a strength exceeding 2 per cent. but not exceeding 3 per cent.

20.09

Wine or made-wine of a strength exceeding 3 per cent. but not exceeding 4 per cent.

28.12

Wine or made-wine of a strength exceeding 4 per cent. but not exceeding 5 per cent.

36.17

Wine or made-wine of a strength exceeding 5 per cent. but not exceeding 5.5 per cent.

44.20

Wine or made-wine of a strength exceeding 5.5 per cent. but not exceeding 15 per cent. and not being sparkling

120.54

Sparkling wine or sparkling made-wine of a strength exceeding 5.5 per cent. but not exceeding 15 per cent.

199.04

Wine or made-wine of a strength exceeding 15 per cent. but not exceeding 18 per cent.

207.89

Wine or made-wine of a strength exceeding 18 per cent. but not exceeding 22 per cent.

239.80

Wine or made-wine of a strength exceeding 22 per cent.

239.80plus £18.96 for every 1 per cent. or part of 1 per cent. in excess of 22 per cent.

SCHEDULE 2 AMENDMENTS RELATING TO BEER DUTY

Section 7.

General amendment of enactments relating to beer

1

Subject to section 7 of this Act and the following provisions of this Schedule—

a

for the words “brewer for sale” or “brewers for sale”, wherever occurring in the Customs and Excise Acts 1979 F187... F221... there shall be substituted respectively the words “registered brewer ” or “registered brewers ”; and

b

for the word “brew”, “brews”, “brewing” or “brewed”, wherever occurring in those Acts in connection with worts or beer, there shall be substituted respectively the word “produce ”, “produces ”, “producing ” or “produced ”.

The Alcoholic Liquor Duties Act 1979 (c.4)

2

In section 1 of the Alcoholic Liquor Duties Act 1979, in subsection (3) (definition of beer)—

a

for the words “on analysis of a sample is found to be” there shall be substituted the word “is ”; and

b

paragraph (b) and the word “or” immediately preceding it shall cease to have effect.

I83

C41

In section 2 of that Act, in subsection (3A) (regulations enabling the strength, weight or volume of spirits, wine or made-wine to be ascertained by reference to information on the label of the container etc) after the word “spirits,” in both places where it occurs there shall be inserted the word “beer, ”.

C42

In subsection (5) of that section (saving for other methods of calculating the strength, weight or volume of wine, made-wine or cider) after the words “volume of” there shall be inserted the word “beer, ”.

3

Subsection (6) of that section (section not to apply to beer) shall cease to have effect.

4

In section 3 of that Act (meaning of, and method of ascertaining, gravity of liquids)—

a

in subsection (3), the words “Subject to subsection (5) below”, and

b

subsection (5) (original gravity for purposes of section 38),

shall cease to have effect.

I95

C51

Section 4(1) of that Act (definitions) shall be amended in accordance with the following provisions of this paragraph.

2

The definitions of “brewer” and “brewer for sale” and of “limited licence to brew beer” shall be omitted.

C53

After the definition of “methylated spirits” there shall be inserted—

“package, in relation to beer, means to put beer into tanks, casks, kegs, cans, bottles or any other receptacles of a kind in which beer is distributed to wholesalers or retailers;

“packager, in relation to beer, means a person carrying on the business of packaging beer;

C54

After the definition of “rectifier” there shall be inserted—

“registered brewer has the meaning given by section 47(1) below;

6

Sections 37, 38 and 39 of that Act (which make provision for the duty on beer brewed in the UK to be charged by reference to worts and gravity and as to the charging and payment of duty on such beer brewed by brewers for sale and by private brewers) shall cease to have effect.

7

Section 40 of that Act (duty on imported beer etc) shall cease to have effect.

8

For section 41 of that Act (exemption from duty of beer brewed for private consumption) there shall be substituted—

41 Exemption from duty of beer produced for private consumption.

The duty on beer produced in the United Kingdom shall not be chargeable on beer produced by a person who produces beer only for his own domestic use.

9

In section 42 of that Act (drawback on exportation, removal to excise warehouse, shipment as stores etc) for subsection (3) (declaration required for beer brewed in the UK) there shall be substituted—

3

In the case of beer produced in the United Kingdom, the person intending to remove, export or ship the beer shall produce to the proper officer a declaration made by the person who paid the duty on the beer, in such form and manner as the Commissioners may direct, stating the strength of the beer and the date on which the duty became payable.

F7610

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

11

In section 44 of that Act (remission or repayment of duty on beer used for purposes of research or experiment) in subsection (1) for the word “brewing” there shall be substituted the words “the production of beer ”.

F7712

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

C613

For section 46 of that Act (remission or repayment of duty on spoilt beer) there shall be substituted—

46 Remission or repayment of duty on spoilt beer.

1

Where it is shown to the satisfaction of the Commissioners that any beer which has been removed from any premises of a registered brewer in respect of which he is registered under section 47 below has become spoilt or otherwise unfit for use and, in the case of beer delivered to another person, has been returned to the registered brewer as so spoilt or unfit, the Commissioners shall, subject to compliance with such conditions as they may by regulations impose, remit or repay any duty charged or paid in respect of the beer.

2

If any person contravenes or fails to comply with any regulation made under subsection (1) above, he shall be liable on summary conviction to a penalty not exceeding level 3 on the standard scale.

C714

For section 49 of that Act (power to regulate manufacture of beer by brewers for sale) there shall be substituted—

49 Beer regulations.

1

The Commissioners may, with a view to managing, securing and collecting the duty on beer produced in, or imported into, the United Kingdom or to the protection of the revenues derived from the duty of excise on beer, make regulations—

a

regulating the production, packaging, keeping and storage of beer produced in the United Kingdom and the packaging, keeping and storage of beer imported into the United Kingdom;

b

regulating the registration of persons and premises under section 41A or 47 above and the revocation or variation of any such registrations;

c

for determining under or in accordance with the regulations when the production of beer begins and when it is completed;

d

for securing and collecting the duty;

e

for determining the duties chargeable, the rates of those duties, the persons liable to pay them and in that connection prescribing the method of charging the duties, the due dates for payment and the method of payment;

f

for charging the duty, in such circumstances as may be prescribed in the regulations, by reference to a strength which the beer might reasonably be expected to have, or the rate of duty in force, at a time other than that at which the beer becomes chargeable;

g

for relieving beer from the duty in such circumstances and to such extent as may be prescribed in the regulations;

h

regulating and, in such circumstances as may be prescribed in the regulations, prohibiting the addition of substances to, the mixing of, or the carrying out of other operations on or in relation to, beer;

j

regulating the transportation of beer in such circumstances as may be prescribed in the regulations.

2

Regulations under this section may make different provision for persons, premises or beer of different classes or descriptions, for different circumstances and for different cases.

3

Any person contravening or failing to comply with any regulation made under this section shall be liable on summary conviction to a penalty not exceeding level 5 on the standard scale, and any article or substance in respect of which the offence was committed shall be liable to forfeiture.

15

1

In section 49A of that Act, in subsection (1) (duty determined in accordance with regulations under section 49(1)(bb) deemed to have been paid for purposes of claims for drawback by brewers for sale)—

a

for the words “brewer for sale” there shall be substituted the words “registered brewer or person registered under section 41A above ”; and

b

for the words “section 49(1)(bb)” there shall be substituted the words “section 49(1)(e) ”.

2

In subsection (2) of that section—

a

for the words “brewer for sale” in both places where they occur there shall be substituted the words “registered brewer or person registered under section 41A above ”;

b

for the words “the brewer” there shall be substituted the word “he ”; and

c

for the words “under section 38 above” there shall be substituted the words “in respect of the excise duty on beer ”.

16

Section 50 of that Act (regulations as respects sugar kept by brewers for sale) shall cease to have effect.

F7817

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

18

Section 53 of that Act (limited licences to brew) shall cease to have effect.

19

Section 71A of that Act (restrictions on adding substances to beer) shall cease to have effect.

20

Section 72 of that Act (offences by wholesaler or retailer of beer) shall cease to have effect.

The Bankruptcy (Scotland) Act 1985 (c.66)

F25821

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

The Insolvency Act 1986 (c.45)

F17721A

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

F17822

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

The Insolvency (Northern Ireland) Order 1989

F18822A

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

F18923

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

The Licensing (Northern Ireland) Order 1990

F7924

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

Annotations:
Amendments (Textual)
F79

S. 24 repealed (20.2.1997) by S.I. 1996/3158(N.I. 22), art. 85(4), Sch. 13

SCHEDULE 3 MODIFICATION OF ENACTMENTS EXTENDED TO NORTHERN IRELAND

Section 10.

Part I THE VEHICLES (EXCISE) ACT 1971

Introduction

F801

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

Excise duty on, and licensing of, mechanically propelled vehicles

F812

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

Exemptions from duty

F823

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

F834

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

5

1

In section 7 (miscellaneous exemptions from duty)—

F84a

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

F85b

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

F842

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

F853

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

F844

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

F845

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

Liability to pay duty and consequences of non-payment

F866

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

F877

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

F888

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

F899

  • . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F9010

  • . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Registration and registration marks, etc.

F9111

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

Miscellaneous

F9212

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

F9313

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

F9414

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

F9515

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

F9616

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

F9717

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

Supplementary

F9818

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

F9919

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

Schedules

F10020

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

F10121

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

F10222

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

F10323

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

F104. . .

Annotations:
Amendments (Textual)
F104

Sch. 3 Pt. II repealed (3.5.1994) by 1994 c. 9, s. 258, Sch. 3, Sch. 26 Pt. I Note(3)

24

In section 11 of the M32Finance Act 1976, for subsection (5) there shall be substituted the following subsection—

5

In its application to Northern Ireland, this section shall have effect as if in subsection (2)—

a

for paragraph (b) there were substituted the following paragraph—

”

the relevant maximum weight or, as the case may be, the relevant maximum train weight of the vehicle;”

and

b

in paragraph (c) for the words “plated weights there were substituted “relevant maximum weight or, as the case may be, such relevant maximum train weight.

SCHEDULE 4 REGISTERED EXCISE DEALERS AND SHIPPERS

Section 11.

Annotations:
Marginal Citations

After Part VIIIA of the M26Customs and Excise Management Act 1979 there shall be inserted—

Part VIIIB REGISTERED EXCISE DEALERS AND SHIPPERS

100G Registered excise dealers and shippers.

1

For the purpose of administering, collecting or protecting the revenues derived from duties of excise, the Commissioners may by regulations under this section (in this Act referred to as “registered excise dealers and shippers regulations)—

a

confer or impose such powers, duties, privileges and liabilities as may be prescribed in the regulations upon any person who is or has been a registered excise dealer and shipper; and

b

impose on persons other than registered excise dealers and shippers, or in respect of any goods of a class or description specified in the regulations, such requirements or restrictions as may by or under the regulations be prescribed with respect to registered excise dealers and shippers or any activities carried on by them.

2

The Commissioners may approve, and enter in a register maintained by them for the purpose, any revenue trader who applies for registration under this section and who appears to them to satisfy such requirements for registration as they may think fit to impose.

3

In the customs and excise Acts “registered excise dealer and shipper means a revenue trader approved and registered by the Commissioners under this section.

4

The Commissioners may approve and register a person under this section for such periods and subject to such conditions or restrictions as they may think fit or as they may by or under the regulations prescribe.

5

The Commissioners may at any time for reasonable cause revoke or vary the terms of their approval or registration of any person under this section.

6

The regulations may make provision for treating revenue traders as approved and registered under this section in cases where they are members of a group of companies (within the meaning of the regulations) which is approved and registered in accordance with the regulations.

100H Registered excise dealers and shippers regulations.

1

a

regulating the approval and registration of persons as registered excise dealers and shippers and the variation or revocation of any such approval or registration or of any condition or restriction to which such an approval or registration is subject;

b

regulating any activities carried on by or for a registered excise dealer and shipper and, in particular, the importation, exportation, buying, selling, loading, unloading, delivery, movement, holding, deposit, security, treatment or removal of, or the carrying out of operations on, or the effecting of any other transaction relating to, any goods of a class or description subject to a duty of excise;

c

authorising a registered excise dealer and shipper to carry out or arrange for the carrying out of any prescribed activity falling within paragraph (b) above in relation to goods chargeable with a duty of excise which has not been paid, but subject to prescribed conditions or restrictions and to prescribed requirements for the payment of the unpaid duty;

d

exempting registered excise dealers and shippers from compliance with such provisions made by or under the customs and excise Acts as may be prescribed, or applying such provisions in relation to registered excise dealers and shippers with prescribed modifications or adaptations, or applying in relation to registered excise dealers and shippers such substitute provisions as may be prescribed in place of any such provisions;

e

requiring, except as otherwise permitted by the Commissioners, goods which are subject to a duty of excise that has not been paid and which are not consigned to an excise warehouse—

i

to be consigned to a registered excise dealer and shipper; and

ii

to be accompanied by such documents in such form and such manner and containing such particulars as may be prescribed;

f

imposing on a registered excise dealer and shipper liability for the payment of duties of excise chargeable on any goods or, in prescribed cases, imposing joint and several liability for the payment of any such duties on a registered excise dealer and shipper and some other person specified in the regulations who, if not a registered excise dealer and shipper, would have been liable for their payment apart from this paragraph;

g

for securing and collecting any duty of excise for the payment of which a registered excise dealer and shipper is or may be liable;

h

for determining, in relation to goods which are the subject of a transaction involving a registered excise dealer and shipper, the duties of excise chargeable, the rates of those duties and the persons liable to pay them and the time at which and manner in which payment is to be made and, in that connection, prescribing the method of charging the duties;

j

permitting payment of excise duty by a registered excise dealer and shipper to be deferred, subject to compliance with prescribed conditions;

k

for relieving registered excise dealers and shippers from liability to pay excise duty on goods in prescribed circumstances;

l

for cases where a registered excise dealer and shipper acts as agent for some other person (whether a registered excise dealer and shipper or not);

m

requiring registered excise dealers and shippers to keep and make available for inspection such records relating to their activities as such as may be prescribed;

n

for goods in the United Kingdom which are liable to a duty of excise which has not been paid to be subject to forfeiture for any breach of—

i

registered excise dealers and shippers regulations, so far as relating to goods chargeable with a duty of excise which has not been paid, or

ii

any condition or restriction imposed by or under any such regulations so far as so relating.

2

Registered excise dealers and shippers regulations may make different provision for persons or goods of different classes or descriptions, for different circumstances and for different cases.

3

In this section “prescribed means prescribed in registered excise dealers and shippers regulations or prescribed by the Commissioners under any such regulations.

100J Contravention of regulations etc.

If any person contravenes any provision of registered excise dealers and shippers regulations or fails to comply with any condition or restriction which the Commissioners impose upon him under section 100G above or by or under any such regulations, he shall be liable on summary conviction to a penalty of any amount not exceeding level 5 on the standard scale and any goods in respect of which the offence was committed shall be liable to forfeiture.

SCHEDULE 5 PROTECTION OF THE REVENUES DERIVED FROM EXCISE DUTIES

Section 12.

Annotations:
Marginal Citations

After Part IX of the M27Customs and Excise Management Act 1979 there shall be inserted—

Part IXA PROTECTION OF THE REVENUES DERIVED FROM EXCISE DUTIES

118A Duty of revenue traders to keep records.

1

The Commissioners may by regulations require every revenue trader—

a

to keep such records as may be prescribed in the regulations; and

b

to preserve those records for such period not exceeding six years as may be prescribed in the regulations or for such lesser period as the Commissioners may require.

2

Regulations under this section—

a

may make different provision for different cases; and

b

may be framed by reference to such records as may be specified in any notice published by the Commissioners in pursuance of the regulations and not withdrawn by a further notice.

3

Any duty imposed under this section to preserve records may be discharged by the preservation of the information contained therein by such means as the Commissioners may approve.

4

Where any information is preserved in accordance with subsection (3) above, a copy of any document forming part of the records in question shall, subject to the following provisions of this section, be admissible in evidence in any proceedings, whether civil or criminal, to the same extent as the records themselves.

5

The Commissioners may, as a condition of approving under subsection (3) above any means of preserving information contained in any records, impose such reasonable requirements as appear to them necessary for securing that the information will be as readily available to them as if the records themselves had been preserved.

6

A statement contained in a document produced by a computer shall not by virtue of subsection (4) above be admissible in evidence—

a

in civil proceedings in England and Wales, except in accordance with sections 5 and 6 of the Civil Evidence Act 1968;

b

in criminal proceedings in England and Wales, except in accordance with sections 69 and 70 of the Police and Criminal Evidence Act 1984 and Part II of the Criminal Justice Act 1988;

c

in civil proceedings in Scotland, except in accordance with sections 13 and 14 of the Law Reform (Miscellaneous Provisions) (Scotland) Act 1968;

d

in criminal proceedings in Scotland, except in accordance with the said sections 13 and 14, which shall, for the purposes of this section, apply with the necessary modifications to such proceedings;

e

in civil proceedings in Northern Ireland, except in accordance with sections 2 and 3 of the Civil Evidence Act (Northern Ireland) 1971; and

f

in criminal proceedings in Northern Ireland, except in accordance with Article 68 of the Police and Criminal Evidence (Northern Ireland) Order 1989 and Part II of the Criminal Justice (Evidence Etc.) (Northern Ireland) Order 1988.

7

Notwithstanding the preceding provisions of this section, in criminal proceedings the court may, for special cause, require oral evidence to be given of any matter of which evidence could ordinarily be given by means of a certificate under—

a

section 5(4) of the Civil Evidence Act 1968,

b

section 13(4) of the Law Reform (Miscellaneous Provisions) Scotland Act 1968, or

c

section 2(4) of the Civil Evidence Act (Northern Ireland) 1971.

118B Duty of revenue traders and others to furnish information and produce documents.

1

Every revenue trader shall—

a

furnish to the Commissioners, within such time and in such form as they may reasonably require, such information relating to—

i

any goods or services supplied by or to him in the course or furtherance of a business, or

ii

any goods in the importation or exportation of which he is concerned in the course or furtherance of a business,

as they may reasonably specify; and

b

upon demand made by an officer, produce or cause to be produced for inspection by that officer—

i

at the principal place of business of the revenue trader or at such other place as the officer may reasonably require, and

ii

at such time as the officer may reasonably require,

any documents relating to the goods or services or to the supply, importation or exportation.

2

Where, by virtue of subsection (1) above, an officer has power to require the production of any documents from a revenue trader—

a

he shall have the like power to require production of the documents concerned from any other person who appears to the officer to be in possession of them; but

b

if that other person claims a lien on any document produced by him, the production shall be without prejudice to the lien.

3

For the purposes of this section, the documents relating to the supply of goods or services, or the importation or exportation of goods, in the course or furtherance of any business shall be taken to include—

a

any profit and loss account and balance sheet, and

b

any records required to be kept by virtue of section 118A above,

relating to that business.

4

An officer may take copies of, or make extracts from, any document produced under subsection (1) or (2) above.

5

If it appears to an officer to be necessary to do so, he may, at a reasonable time and for a reasonable period, remove any document produced under subsection (1) or (2) above and shall, on request, provide a receipt for any document so removed.

6

Where a lien is claimed on a document produced under subsection (2) above, the removal of the document under subsection (5) above shall not be regarded as breaking the lien.

7

Where a document removed by an officer under subsection (5) above is reasonably required for the proper conduct of a business he shall, as soon as practicable, provide a copy of the document, free of charge, to the person by whom it was produced or caused to be produced.

8

Where any documents removed under the powers conferred by this section are lost or damaged, the Commissioners shall be liable to compensate their owner for any expenses reasonably incurred by him in replacing or repairing the documents.

118C Entry and search of premises and persons.

1

For the purpose of exercising any powers under the customs and excise Acts an officer may at any reasonable time enter premises used in connection with the carrying on of a business.

2

Where an officer has reasonable cause to believe that any premises are used in connection with the supply, importation or exportation of goods of a class or description chargeable with a duty of excise and that any such goods are on those premises, he may at any reasonable time enter and inspect those premises and inspect any goods found on them.

3

If a justice of the peace or, in Scotland, a justice (within the meaning of section 462 of the Criminal Procedure (Scotland) Act 1975) is satisfied on information on oath—

a

that there is reasonable ground for suspecting that a fraud offence which appears to be of a serious nature is being, has been or is about to be committed on any premises, or

b

that evidence of the commission of such an offence is to be found there,

he may issue a warrant in writing authorising, subject to subsections (6) and (7) below, any officer to enter those premises, if necessary by force, at any time within the period of one month beginning with the date of the issue of the warrant and search them.

4

Any officer who enters premises under the authority of a warrant under subsection (3) above may—

a

take with him such other persons as appear to him to be necessary;

b

seize and remove any documents or other things whatsoever found on the premises which he has reasonable cause to believe may be required as evidence for the purposes of proceedings in respect of a fraud offence which appears to him to be of a serious nature; and

c

search or cause to be searched any person found on the premises whom he has reasonable cause to believe to be in possession of any such documents or other things;

but no woman or girl shall be searched by virtue of this subsection except by a woman.

5

In subsections (3) and (4) above “a fraud offence means an offence under any provision of section 167(1), 168 or 170 below.

6

The powers conferred by a warrant under this section shall not be exercisable—

a

by more than such number of officers as may be specified in the warrant; nor

b

outside such times of day as may be so specified; nor

c

if the warrant so provides, otherwise than in the presence of a constable in uniform.

7

An officer seeking to exercise the powers conferred by a warrant under this section or, if there is more than one such officer, that one of them who is in charge of the search shall provide a copy of the warrant endorsed with his name as follows—

a

if the occupier of the premises concerned is present at the time the search is to begin, the copy shall be supplied to the occupier;

b

if at the time the occupier is not present but a person who appears to the officer to be in charge of the premises is present, the copy shall be supplied to that person; and

c

if neither paragraph (a) nor paragraph (b) above applies, the copy shall be left in a prominent place on the premises.

118D Order for access to recorded information, etc.

1

Where, on an application by an officer, a justice of the peace or, in Scotland, a justice (within the meaning of section 462 of the Criminal Procedure (Scotland) Act 1975) is satisfied that there are reasonable grounds for believing—

a

that an offence in connection with a duty of excise is being, has been or is about to be committed, and

b

that any recorded information (including any document of any nature whatsoever) which may be required as evidence for the purpose of any proceedings in respect of such an offence is in the possession of any person,

he may make an order under this section.

2

An order under this section is an order that the person who appears to the justice to be in possession of the recorded information to which the application relates shall—

a

give an officer access to it, and

b

permit an officer to remove and take away any of it which he reasonably considers necessary,

not later than the end of the period of seven days beginning with the date of the order or the end of such longer period as the order may specify.

3

The reference in subsection (2)(a) above to giving an officer access to the recorded information to which the application relates includes a reference to permitting the officer to take copies of it or to make extracts from it.

4

Where the recorded information consists of information contained in a computer, an order under this section shall have effect as an order to produce the information in a form in which it is visible and legible and, if the officer wishes to remove it, in a form in which it can be removed.

5

This section is without prejudice to sections 118B and 118C above.

118E Procedure when documents etc. are removed.

1

An officer who removes anything in the exercise of a power conferred by or under section 118C or 118D above shall, if so requested by a person showing himself—

a

to be the occupier of premises from which it was removed, or

b

to have had custody or control of it immediately before the removal,

provide that person with a record of what he removed.

2

The officer shall provide the record within a reasonable time from the making of the request for it.

3

Subject to subsection (7) below, if a request for permission to be granted access to anything which—

a

has been removed by an officer, and

b

is retained by the Commissioners for the purposes of investigating an offence,

is made to the officer in overall charge of the investigation by a person who had custody or control of the thing immediately before it was so removed or by someone acting on behalf of such a person, the officer shall allow the person who made the request access to it under the supervision of an officer.

4

Subject to subsection (7) below, if a request for a photograph or copy of any such thing is made to the officer in overall charge of the investigation by a person who had custody or control of the thing immediately before it was so removed, or by someone acting on behalf of such a person, the officer shall—

a

allow the person who made the request access to it under the supervision of an officer for the purpose of photographing it or copying it, or

b

photograph or copy it, or cause it to be photographed or copied.

5

Where anything is photographed or copied under subsection (4)(b) above, the photograph or copy shall be supplied to the person who made the request.

6

The photograph or copy shall be supplied within a reasonable time from the making of the request.

7

There is no duty under this section to grant access to, or to supply a photograph or copy of, anything if the officer in overall charge of the investigation for the purposes of which it was removed has reasonable grounds for believing that to do so would prejudice—

a

that investigation;

b

the investigation of an offence other than the offence for the purposes of the investigation of which the thing was removed; or

c

any criminal proceedings which may be brought as a result of—

i

the investigation of which he is in charge; or

ii

any such investigation as is mentioned in paragraph (b) above.

8

Any reference in this section to the officer in overall charge of the investigation is a reference to the person whose name and address are endorsed on the warrant or order concerned as being the officer so in charge.

118F Failure of officer to comply with requirements under section 118E.

1

Where, on an application made as mentioned in subsection (2) below, the appropriate judicial authority is satisfied that a person has failed to comply with a requirement imposed by section 118E above, the authority may order that person to comply with the requirement within such time and in such manner as may be specified in the order.

2

An application under subsection (1) above shall be made—

a

in the case of a failure to comply with any of the requirements imposed by subsections (1) and (2) of section 118E above, by the occupier of the premises from which the thing in question was removed or by the person who had custody or control of it immediately before it was so removed, and

b

in any other case, by the person who has such custody or control.

3

In this section “the appropriate judicial authority means—

a

in England and Wales, a magistrates’ court;

b

in Scotland, the sheriff; and

c

in Northern Ireland, a court of summary jurisdiction, as defined in Article 2(2)(a) of the Magistrates’ Courts (Northern Ireland) Order 1981.

4

Any application for an order under this section—

a

in England and Wales, shall be made by way of complaint; or

b

in Northern Ireland, shall be made by way of civil proceedings on complaint.

5

Sections 21 and 42(2) of the Interpretation Act (Northern Ireland) 1954 (rules and orders regulating procedure of courts etc and assignment of business to particular courts) shall apply as if any reference in those provisions to any enactment included a reference to this section.

118G Offences under Part IXA.

If any person fails to comply with any requirement imposed under section 118A(1) or section 118B above, he shall be liable on summary conviction to a penalty of any amount not exceeding level 5 on the standard scale.

SCHEDULE 6 RESTRICTION OF HIGHER RATE RELIEF: BENEFICIAL LOANS ETC

Section 27.

Taxation of beneficial loan arrangements

F1741

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

F1052

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

F1743

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

F2474

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

F1065

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

Applicable rates of capital gains tax

F1076

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

SCHEDULE 7 BASIC LIFE ASSURANCE AND GENERAL ANNUITY BUSINESS

Section 48.

Management expenses

1

In section 76 of the Taxes Act 1988 (expenses of management of insurance companies) in subsection (1)—

a

in paragraphs (ca) F175..., for the words “basic life assurance business” there shall be substituted in each place the words “basic life assurance and general annuity business ”;

b

in paragraph (d), the words “general annuity business” shall cease to have effect.

Annotations:
Amendments (Textual)
F175

Words in Sch. 7 para. 1(a) repealed (with effect for accounting periods beginning on or after 1.1.2003 except those ending before 9.4.2003 in accordance with Sch. 33 para. 8(4), Sch. 43 Pt. 3(12) Note 6 of the amending Act) by Finance Act 2003 (c. 14), Sch. 43 Pt. 3(12)

Interpretation of Chapter I of Part XII

F1082

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

Apportionment of income and gains

F1093

  • . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Computation of trading profit

4

1

In section 436 of that Act (general annuity business and pension business: separate charge on profits) in subsection (1)—

a

the words “general annuity business or” shall cease to have effect, and

F205b

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

2

In subsection (3) of that section—

a

in paragraph (c), the words “or general annuity business”, and

b

in paragraph (e), the words “general annuity business or”,

shall cease to have effect.

3

In subsection (4) of that section, the words “general annuity business or” shall cease to have effect.

4

In section 437 of that Act (general annuity business) subsections (2) to (5) shall cease to have effect.

Deduction for annuities referable to basic life assurance and general annuity business

F2395

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

Transfer of assets between classes of business

F1106

  • . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

United Kingdom branches of overseas life assurance companies

7

1

In section 446 of that Act (computation under section 436 of profits arising to an overseas life assurance company)—

F111a

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

b

subsections (2) and (3),

shall cease to have effect.

F1112

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

3

Subsection (3) of that section (proportion of profits arising from general annuity business for purposes of section 446) shall cease to have effect.

F1114

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

F1115

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

Treatment of tax-free income

8

In section 474 of that Act, in subsection (1)(b) (certain tax-free income to be included in computing profits or loss from pension business and general annuity business) the words “and general annuity business” shall cease to have effect.

Life annuity contracts: taxation of gain on chargeable event

F1869

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

Computation of offshore income gains

F11210

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

Interpretation of sections 85 to 89 of Finance Act 1989

F17611

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

Annotations:
Amendments (Textual)
F176

Sch. 7 para. 11 repealed (with effect for accounting periods beginning on or after 1.1.2003 except those ending before 9.4.2003 in accordance with Sch. 33 para. 8(4), Sch. 43 Pt. 3(12) Note 6 of the amending Act) by Finance Act 2003 (c. 14), Sch. 43 Pt. 3(12)

Miscellaneous receipts

F24012

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

Spreading of relief for acquisition expenses

13

F1831

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

F2062

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

3

In subsection (4) of that section (meaning of “the acquisition of business”) after the word “includes” there shall be inserted “(a) ” and at the end there shall be added the words

and

b

the securing, in an accounting period beginning on or after 1st January 1992, of the payment of increased or additional consideration in respect of an annuity contract already made (whether in an accounting period beginning before, or on or after, that date).

Deemed disposal of unit trusts etc

F11314

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

Exemptions and exclusions from charges by virtue of section 46

F11415

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

Transitional relief for old general annuity contracts

C816

1

F184In the F241application of the I - E rules in relation to an accounting period of an insurance company, an amount equal to the lesser of the following amounts is to be treated (if it is not nil) for the purposes of section 76 of the Finance Act 2012 as a deemed BLAGAB management expense for the accounting period that is to say—

a

A, and

b

A - (R1 - R2 + C -SV - DB),

and if the result of the formula in paragraph (b) above is a negative amount, it shall be taken to be nil.

2

For the purposes of sub-paragraph (1) above—

  • A is the gross amount of any annuities paid in the accounting period so far as referable to old annuity contracts;

  • R1 is the amount of the company’s opening liabilities for the accounting period in respect of old annuity contracts F203but taking that amount as nil if it would otherwise be below nil;

  • R2 is the amount of the company’s closing liabilities for the accounting period in respect of old annuity contracts F203but taking that amount as nil if it would otherwise be below nil;

  • C is the amount of any consideration received in the accounting period in respect of old annuity contracts;

  • SV is the amount of any sums paid in the accounting period by reason of the surrender of rights conferred by old annuity contracts;

  • DB is the amount of any death benefits paid in the accounting period in respect of old annuity contracts.

F1153

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

F1154

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

5

If, in the case of an annuity under a group annuity contract made by an insurance company in an accounting period beginning before 1st January 1992—

a

the company’s liabilities first include an amount in respect of that annuity in an accounting period beginning on or after that date, and

b

the company’s liability in respect of that annuity is referable to its basic life assurance and general annuity business,

the group annuity contract, so far as relating to that annuity, shall be treated for the purposes of this paragraph, other than this sub-paragraph, as if it had been made in an accounting period beginning on or after 1st January 1992 (and were, accordingly, not an old annuity contract).

6

If, in the case of an annuity which is subject to a reinsurance treaty made by the reinsurer in an accounting period beginning before 1st January 1992—

a

the reinsurer’s liabilities first include an amount in respect of that annuity in an accounting period beginning on or after that date, and

b

the reinsurer’s liability in respect of that annuity is referable to its basic life assurance and general annuity business,

the reinsurance treaty, as respects the reinsurer and so far as relating to that annuity, shall be treated for the purposes of this paragraph, other than this sub-paragraph, as if it had been made in an accounting period beginning on or after 1st January 1992 (and were, accordingly, not an old annuity contract).

7

In this paragraph—

  • “general annuity contract means an annuity contract so far as referable to general annuity business;

  • “group annuity contract means a contract between an insurance company and some other person under which the company undertakes to become liable to pay annuities to or in respect of such persons as may subsequently be specified or otherwise ascertained under or in accordance with the contract (whether or not annuities under the contract are also payable to or in respect of persons who are specified or ascertained at the time the contract is made);

  • “old annuity contract means a general annuity contract made by an insurance company in an accounting period beginning before 1st January 1992 F207(including one forming part of the business transferred to another insurance company by an insurance business transfer scheme);

  • “reinsurance treaty means a contract under which one insurance company is obliged to cede, and another (in this paragraph referred to as a “reinsurer) to accept, the whole or part of a risk of a class or description to which the contract relates;

F209...

F2088

Where—

a

business is transferred to an insurance company by an insurance business transfer scheme during an accounting period of the company, and

b

the business transferred consists of or includes old annuity contracts (“the transferred contracts”),

the reference in the definition of R1 in sub-paragraph (2) above to the company's opening liabilities for the accounting period is, in relation to the transferred contracts, a reference to the company's liabilities in respect of the transferred contracts immediately after the transfer.

Transitional provisions for chargeable gains and unrelieved general annuity losses

17

1

An insurance company’s unrelieved general annuity losses shall be relieved under this paragraph by setting them against the relevant part of any chargeable gains arising to the company in accounting periods beginning on or after 1st January 1992.

2

Any relief under this paragraph shall be given as far as possible for the first accounting period of the company beginning on or after 1st January 1992 and, so far as it cannot be so given, for the next accounting period, and so on.

3

For the purposes of this paragraph an insurance company’s “unrelieved general annuity losses are so much of any losses—

a

arising from the company’s general annuity business in an accounting period or year of assessment beginning before 1st January 1992, and

b

computed as mentioned in paragraph (c) of subsection (3) of section 436 of the Taxes Act 1988 as it applied in relation to such accounting periods,

as, by virtue only of an insufficiency of profits, cannot be relieved under that subsection (or any previous enactment which it re-enacts) by setting them off against the profits of such an accounting period or year of assessment.

4

For the purposes of this paragraph the relevant part of the chargeable gains arising to a company in an accounting period F210is so much of the chargeable gains arising to the company in the accounting period as are referable to its basic life assurance and general annuity business.

F2114A

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

F2115

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

Application of this Schedule

18

Paragraphs 1, 3, 4, 5, 6(1) and (2), 7, 8, 10 to 14, 16 and 17 above have effect with respect only to accounting periods beginning on or after 1st January 1992.

F116SCHEDULE 8

Annotations:
Amendments (Textual)
F116

Sch. 8 repealed (22.3.2001 with effect in accordance with s. 87 of the amending Act) by 2001 c. 9, s. 110, Sch. 33 Pt. 2(12)

SCHEDULE 9 FRIENDLY SOCIETIES

Section 50.

Tax exempt life or endowment business

F2381

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

F215F2382

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

Maximum benefits payable to members

F2383

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

Qualifying policies

4

1

In Schedule 15 to that Act (qualifying policies) in paragraph 3, sub-paragraph (1)(c) (contract for policy issued by new society to be made by member over 18) shall be omitted, with the word “and” immediately preceding it.

2

This paragraph shall apply in relation to policies issued in pursuance of contracts made on or after the day on which this Act is passed.

5

1

This paragraph applies to any policy—

a

issued by a friendly society, or branch of a friendly society, in the course of tax exempt life or endowment business (as defined in section 466 of the Taxes Act 1988), and

b

effected by a contract made after 31st August 1987 and before the day on which this Act is passed.

2

Where—

a

the amount payable by way of premium under a policy to which this paragraph applies is increased by virtue of a variation made in the period beginning with the day on which this Act is passed and ending with 31st July 1992, and

b

the variation is not such as to cause a person to become in breach of the limits in section 464 of the Taxes Act 1988,

Schedule 15 to that Act, in its application to the policy, shall have effect, in relation to that variation, with the modifications mentioned in sub-paragraph (3) below.

3

The modifications are the omission of paragraph 4(3)(a) and the insertion at the end of paragraph 18(2) of

and as if for paragraph 3(2)(b) above there were substituted—

”

subject to sub-paragraph (4) below, the premiums payable under the policy shall be premiums of equal or rateable amounts payable at yearly or shorter intervals over the whole of the term of the policy as from the variation, or, where premiums are not payable for any period after the person liable to pay them or whose life is insured has attained a specified age, being an age attained at a time not less than ten years after the beginning of the term of the policy, over the whole of the remainder of the period for which premiums are payable.”

SCHEDULE 10 BUILDING SOCIETIES: QUALIFYING SHARES

Section 51.

Capital gains: exemption

F1171

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

Accrued income scheme: inclusion

F1962

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

Incidental costs of issue

F2183

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

Preferential rights of acquisition

F1184

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

SCHEDULE 11 BUILDING SOCIETIES: MARKETABLE SECURITIES

Section 52.

Deduction of income tax

F1971

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

2

F2321

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

F1982

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

F2333

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

Collection

F1993

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

F2004

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

Information

5

1

In section 18 of the M28Taxes Management Act 1970 (information about interest payments) after subsection (3C) there shall be inserted—

3D

For the purposes of this section, the payment by a building society of a dividend in respect of a share in the society shall be treated as the payment of interest.

2

This paragraph shall have effect as regards a case where the payment is made on or after the day on which this Act is passed.

SCHEDULE 12 SECURITIES: NEW ISSUES

Section 54.

General treatment of extra return

F2011

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

Accrued income scheme

F2022

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

Deep discount securities

F1193

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

Deep gain securities

F1204

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

General

5

This Schedule applies if the new securities are issued on or after 19th March 1991 (whether the old securities are issued before or on or after that day).

SCHEDULE 13 MANUFACTURED DIVIDENDS AND INTEREST

Section 58.

The new arrangements

1

After Schedule 23 to the Taxes Act 1988 there shall be inserted—

Schedule 23A MANUFACTURED DIVIDENDS AND INTEREST

Section 736A.

Interpretation

1

1

In this Schedule—

  • “approved stock lending arrangement means an arrangement such as is mentioned in subsection (1), (2) or (2A) of section 129 and in relation to which that section and section 149B(9) of the 1979 Act apply;

  • “dividend manufacturer has the meaning given by paragraph 2(1) below;

  • “dividend manufacturing regulations means regulations made by the Treasury under this Schedule;

  • “interest manufacturer has the meaning given by paragraph 3(1) below;

  • “manufactured dividend, “manufactured interest and “manufactured overseas dividend shall be construed respectively in accordance with paragraphs 2, 3 and 4 below, as shall references to the gross amount thereof;

  • “market maker, in relation to any shares, stock or other securities, means a person who—

a

holds himself out at all normal times in compliance with the rules of the Stock Exchange as willing to buy and sell shares, stock or other securities of the kind concerned at a price specified by him, and

b

is recognised as doing so by the Council of the Stock Exchange,

but subject to any regulations under sub-paragraph (2) below;

  • “overseas dividend means any interest, dividend or other annual payment payable in respect of any overseas securities;

  • “overseas dividend manufacturer has the meaning given by paragraph 4(1) below;

  • “overseas securities means—

a

shares, stock or other securities issued by a government or public or local authority of a territory outside the United Kingdom or by any other body of persons not resident in the United Kingdom; and

b

quoted Eurobonds held in a recognised clearing system, within the meaning of section 124;

  • “overseas tax means tax under the law of a territory outside the United Kingdom;

  • “overseas tax credit means any such credit under the law of a territory outside the United Kingdom in respect of overseas tax as corresponds to a tax credit;

  • “prescribed means prescribed in dividend manufacturing regulations;

  • “recognised clearing house means a recognised clearing house within the meaning of the Financial Services Act 1986;

  • “recognised investment exchange means a recognised investment exchange within the meaning of that Act;

  • “securities includes any loan stock or similar security;

  • “transfer includes any sale or other disposal;

  • “unapproved manufactured payment, subject to any regulations under sub-paragraph (2) below, means—

a

any manufactured dividend, manufactured interest or manufactured overseas dividend paid in connection with an unapproved stock lending arrangement, and

b

any manufactured dividend or manufactured interest not falling within paragraph (a) above which is paid in respect of United Kingdom securities or United Kingdom equities by a person other than one who is—

i

a market maker in relation to United Kingdom securities or United Kingdom equities of the kind in question, or

ii

in such circumstances as may be prescribed, a member, of a prescribed class or description, of a prescribed recognised investment exchange, or

iii

in such circumstances as may be prescribed, a prescribed recognised clearing house,and which is so paid otherwise than in connection with an approved stock lending arrangement;

  • “unapproved stock lending arrangement means an arrangement such as is mentioned in subsection (1), (2) or (2A) of section 129, but which, in consequence of regulations under subsection (4) of that section, is not an approved stock lending arrangement;

  • “United Kingdom equities means shares of any company resident in the United Kingdom;

  • “United Kingdom securities means securities of the government of the United Kingdom, of any public or local authority in the United Kingdom or of any company or other body resident in the United Kingdom, but does not include quoted Eurobonds held in a recognised clearing system, within the meaning of section 124, or United Kingdom equities.

2

Dividend manufacturing regulations may amend sub-paragraph (1) above—

a

by changing the definition for the time being of “market maker”; or

b

by changing the definition for the time being of “unapproved manufactured payment”.

Manufactured dividends on United Kingdom equities

2

1

This paragraph applies in any case where, under a contract or other arrangements for the transfer of United Kingdom equities, one of the parties (the “dividend manufacturer) is required to pay to the other ( “the recipient) an amount representative of a dividend on the equities; and in this Schedule the “manufactured dividend means any payment which the dividend manufacturer makes in discharge of that requirement.

2

If, in a case where this paragraph applies, the dividend manufacturer is a company resident in the United Kingdom, then, for all purposes of the Tax Acts, the manufactured dividend shall be treated as if it were a dividend of, and paid by, the dividend manufacturer (and shall accordingly be a distribution of the dividend manufacturer for those purposes).

3

If, in a case where this paragraph applies, the dividend manufacturer is not such a company as is mentioned in sub-paragraph (2) above (so that section 737 applies in relation to the dividend manufacturer) the manufactured dividend shall for all purposes of the Tax Acts be treated in relation to the recipient and all persons claiming title through or under him—

a

as if the manufactured dividend were a dividend on the United Kingdom equities,

b

as if any amount required in consequence of section 737 to be deducted by the dividend manufacturer on account of income tax in respect of the gross amount of the manufactured dividend were required to be accounted for by him as advance corporation tax in respect of the dividend, and

c

as if any certificate of deduction of tax required in consequence of that section to be issued in connection with the manufactured dividend were the tax credit certificate that would have been issued had the manufactured dividend in fact been a dividend on the United Kingdom equities.

4

For the purposes of sub-paragraph (3)(b) above, the gross amount of a manufactured dividend is the aggregate of the amount of the manufactured dividend and the amount of the tax credit that would have been issued in respect thereof had the manufactured dividend in fact been a dividend on the United Kingdom equities.

Manufactured interest on United Kingdom securities

3

1

This paragraph applies in any case where, under a contract or other arrangements for the transfer of United Kingdom securities, one of the parties (the “interest manufacturer) is required to pay to the other ( “the recipient) an amount representative of a periodical payment of interest on the securities; and in this Schedule the “manufactured interest means any payment which the interest manufacturer makes in discharge of that requirement.

2

If, in a case where this paragraph applies, the interest manufacturer is a company resident in the United Kingdom, then, for all purposes of the Tax Acts, the gross amount of the manufactured interest shall be treated as if it were the gross amount of a periodical payment of interest on the securities, but made by the interest manufacturer.

3

If, in a case where this paragraph applies, the interest manufacturer is not such a company as is mentioned in sub-paragraph (2) above (so that section 737 applies in relation to the interest manufacturer) the gross amount of the manufactured interest shall for all purposes of the Tax Acts be treated in relation to the recipient, and all persons claiming title through or under him, as if it were the gross amount of a periodical payment of interest on the securities, but made by the interest manufacturer.

4

For the purposes of this paragraph the gross amount of any manufactured interest is an amount equal to the gross amount of that periodical payment of interest of which the manufactured interest is representative, as mentioned in sub-paragraph (1) above.

Manufactured overseas dividends

4

1

This paragraph applies in any case where, under a contract or other arrangements for the transfer of overseas securities, one of the parties (the “overseas dividend manufacturer) is required to pay to the other ( “the recipient) an amount representative of an overseas dividend on the overseas securities; and in this Schedule the “manufactured overseas dividend means any payment which the overseas dividend manufacturer makes in discharge of that requirement.

2

Subject to sub-paragraph (3) below, where this paragraph applies the gross amount of the manufactured overseas dividend shall be treated for all purposes of the Tax Acts as an annual payment, within section 349, but—

a

the amount which is to be deducted from that gross amount on account of income tax shall be an amount equal to the relevant withholding tax on that gross amount; and

b

in the application of sections 338(4)(a) and 350(4) in relation to manufactured overseas dividends the references to Schedule 16 shall be taken as references to dividend manufacturing regulations;

and paragraph (a) above is without prejudice to any further amount required to be deducted under dividend manufacturing regulations by virtue of sub-paragraph (8) below.

3

If, in a case where this paragraph applies, the overseas dividend manufacturer is not resident in the United Kingdom and the manufactured overseas dividend is paid by him otherwise than in the course of a trade which he carries on through a branch or agency in the United Kingdom, sub-paragraph (2) above shall not apply; but if the manufactured overseas dividend is received by a person resident in the United Kingdom (the “United Kingdom recipient), then unless the United Kingdom recipient shows either—

a

that the overseas dividend manufacturer was entitled to payment of the overseas dividend as the registered holder of the overseas securities, or

b

that the overseas dividend manufacturer was entitled to payment of the overseas dividend directly or indirectly from a person from whom he acquired the overseas securities, or to whom he transferred them, and who was so entitled to the payment,

the United Kingdom recipient shall account for and pay an amount of tax in respect of the manufactured overseas dividend equal to that which the overseas dividend manufacturer would have been required to account for and pay had he been resident in the United Kingdom; and any reference in this Schedule to an amount deducted under sub-paragraph (2) above includes a reference to an amount of tax accounted for and paid under this sub-paragraph.

4

Where a manufactured overseas dividend is paid after deduction of the amount required by sub-paragraph (2) above, or where the amount of tax required under sub-paragraph (3) above in respect of such a dividend has been accounted for and paid, then for all purposes of the Tax Acts as they apply in relation to persons resident in the United Kingdom or to persons not so resident but carrying on business through a branch or agency in the United Kingdom—

a

the manufactured overseas dividend shall be treated in relation to the recipient, and all persons claiming title through or under him, as if it were an overseas dividend of an amount equal to the gross amount of the manufactured overseas dividend, but paid after the withholding therefrom, on account of overseas tax, of the amount deducted under sub-paragraph (2) above; and

b

the amount so deducted shall accordingly be treated in relation to the recipient, and all persons claiming title through or under him, as an amount so withheld instead of as an amount on account of income tax.

5

For the purposes of this paragraph—

a

“relevant withholding tax, in relation to the gross amount of a manufactured overseas dividend, means an amount of tax representative of—

i

the amount (if any) that would have been deducted by way of overseas tax from an overseas dividend on the overseas securities of the same gross amount as the manufactured overseas dividend; and

ii

the amount of the overseas tax credit (if any) in respect of such an overseas dividend;

b

the gross amount of a manufactured overseas dividend is an amount equal to the gross amount of that overseas dividend of which the manufactured overseas dividend is representative, as mentioned in sub-paragraph (1) above; and

c

the gross amount of an overseas dividend is an amount equal to the aggregate of—

i

so much of the overseas dividend as remains after the deduction of the overseas tax (if any) chargeable on it;

ii

the amount of the overseas tax (if any) so deducted; and

iii

the amount of the overseas tax credit (if any) in respect of the overseas dividend.

6

Dividend manufacturing regulations may make provision with respect to the rates of relevant withholding tax which are to apply in relation to manufactured overseas dividends in relation to different overseas territories, but in prescribing those rates the Treasury shall have regard to—

a

the rates at which overseas tax would have fallen to be deducted, and

b

the rates of overseas tax credits,

in overseas territories, or in the particular overseas territory, in respect of payments of overseas dividends on overseas securities.

7

Dividend manufacturing regulations may make provision for a person who, in any chargeable period, is an overseas dividend manufacturer to be entitled in prescribed circumstances to set off against each other, in accordance with the regulations—

a

overseas tax in respect of any overseas dividends, or amounts deducted under sub-paragraph (2) above from any manufactured overseas dividends, received by him in that chargeable period, and

b

the sums due from him on account of the amounts deducted by him under sub-paragraph (2) above from the manufactured overseas dividends paid by him in that chargeable period,

and account to the Board for, or as the case may be, claim credit in respect of, the balance.

8

Dividend manufacturing regulations may also make provision for cases where a manufactured overseas dividend is paid or otherwise dealt with in circumstances such that, had it been an overseas dividend in respect of the overseas securities, it would have been—

a

a relevant foreign dividend, within the meaning of section 123,

b

a foreign dividend, within the meaning of that section,

c

interest on a quoted Eurobond held in a recognised clearing system, within the meaning of section 124, or

d

an overseas public revenue dividend, within the meaning of Part III,

and, notwithstanding anything in sub-paragraph (2) or (3) above, any such regulations may provide for deductions of an amount determined by reference to the gross amount of the manufactured overseas dividend to be made from the manufactured overseas dividend on account of income tax similar to the deductions that would, in the case of an overseas dividend, be made under subsection (2) or (3) of section 123 or under Part III, as the case may be, and for Parts III and IV of Schedule 3 to apply with prescribed modifications in relation thereto.

Dividends and interest passing through the market

5

1

Sub-paragraph (2) below applies in any case where, under a contract or other arrangements for the transfer of securities, a party ( “the payment manufacturer) who satisfies the following condition, that is to say, that he is entitled either—

a

to a dividend or a periodical payment of interest as the registered holder of the securities, or

b

to payment, whether directly or indirectly, of any such dividend or interest from a person from whom he acquired the securities or to whom he transferred them,

is required to pay to the other party ( “the recipient) an amount representative of that dividend or interest; and in this paragraph the “manufactured payment means any payment which the payment manufacturer makes in discharge of that requirement.

2

Where this sub-paragraph applies—

a

paragraphs 2, 3 and 4 above and section 737 shall not apply in relation to the manufactured payment,

b

the dividend or interest shall be treated for all purposes of the Tax Acts as the income of the recipient and not as the income of the payment manufacturer, and

c

the manufactured payment shall not be regarded as the income of the recipient,

but this sub-paragraph is subject to sub-paragraphs (3) and (4) below.

3

In any case where—

a

any dividend or interest would, apart from the application or, as the case may be, the subsequent application of this sub-paragraph, be treated by virtue of any provision of this paragraph as the income of a person (the “subsequent manufacturer) who is a party to a further contract or other arrangements for the transfer of securities, and

b

under that contract or those arrangements, the subsequent manufacturer is required to pay to the other party (the “subsequent recipient) an amount representative of the dividend or interest (the “subsequent manufactured payment),

sub-paragraph (4) below shall apply instead of sub-paragraph (2) above (and, on any second or subsequent application of this sub-paragraph, instead of sub-paragraph (4) below as it last applied).

4

Where this sub-paragraph applies—

a

paragraphs 2, 3 and 4 above and section 737 shall not apply in relation to the manufactured payment or any subsequent manufactured payment;

b

the dividend or interest shall be treated for all purposes of the Tax Acts as the income of the subsequent recipient (or, on a second or subsequent application of sub-paragraph (3) above, the last of them) and not as the income of any other person; and

c

neither the manufactured payment nor any subsequent manufactured payment shall be regarded as the income of the recipient or of any subsequent recipient;

but this sub-paragraph is subject to any subsequent application of sub-paragraph (3) above.

5

Notwithstanding anything in sub-paragraphs (1) to (4) above, in any case where—

a

the dividend or interest is an overseas dividend,

b

the payment manufacturer or a subsequent manufacturer is resident in the United Kingdom but the recipient or a subsequent recipient is not so resident, and

c

the rates of overseas tax or overseas tax credit applicable to the overseas dividend in relation to the payment manufacturer or subsequent manufacturer falling within paragraph (b) above are different from what they would have been in relation to the recipient or subsequent recipient falling within that paragraph, had the overseas dividend been paid directly to him,

dividend manufacturing regulations may, in such cases as may be prescribed, make provision for tax to be charged on, or for credit in respect of tax to be given to, such one of the manufacturers falling within paragraph (b) above as may be determined in accordance with the regulations, at such rates as may be so determined.

6

Any reference in this paragraph to securities is a reference to United Kingdom equities, United Kingdom securities or overseas securities.

Unapproved manufactured payments

6

1

This paragraph applies where a person makes an unapproved manufactured payment.

2

Where the unapproved manufactured payment is a manufactured dividend paid by a company, any advance corporation tax paid by the company in respect of the manufactured dividend—

a

shall not be set against any liability of the company to corporation tax as mentioned in section 239;

b

shall not be surrendered under, or otherwise treated as mentioned in, section 240; and

c

shall not be utilised in any other way for the purposes of the Tax Acts;

and no franked investment income of a company shall be used to frank (within the meaning of section 241(5)) the manufactured dividend.

3

Where the unapproved manufactured payment is manufactured interest paid by a company—

a

relief shall not be given to the company under any provision of the Tax Acts in respect of any amount which the company is required to deduct from the payment on account of income tax; and

b

the company shall not be entitled under paragraph 5(1) of Schedule 16 to claim to set income tax borne by deduction from payments received by it against the income tax which it is liable to pay in respect of the payment of manufactured interest.

4

Where the unapproved manufactured payment is a manufactured overseas dividend—

a

relief shall not be given to any person under any provision of the Tax Acts in respect of any amount which he is required to deduct from the payment on account of income tax; and

b

a person shall not be entitled under or by virtue of this Schedule to set—

i

overseas tax in respect of overseas dividends received by him, or

ii

an amount deducted under paragraph 4(2) above in respect of manufactured overseas dividends received by him,

against any income tax which he is liable to pay in respect of the payment of the manufactured overseas dividend.

5

If it appears to an inspector that, notwithstanding the foregoing provisions of this paragraph, franked investment income of a company has been used to frank a manufactured dividend which is an unapproved manufactured payment, he may make an assessment on the dividend manufacturer under sub-paragraph (3) of paragraph 3 of Schedule 13 and that sub-paragraph shall accordingly apply in relation to the amount of advance corporation tax in question.

6

If it appears to an inspector that, notwithstanding the foregoing provisions of this paragraph, income tax on income received by an interest manufacturer has been set against an amount deducted by the interest manufacturer on account of income tax on a payment of manufactured interest which is an unapproved manufactured payment, the inspector may make an assessment on the interest manufacturer under paragraph 4 of Schedule 16 and that paragraph shall accordingly apply in relation to the amount of income tax in question.

7

In this paragraph “relief means relief by way of—

a

deduction in computing profits or gains; or

b

deduction or set off against income or total profits.

Irregular manufactured payments

7

1

Except where paragraph 5(2) or (4) above applies, in any case where (apart from this paragraph)—

a

an amount paid by way of manufactured dividend would exceed the amount of the dividend of which it is representative, or

b

the aggregate of—

i

an amount paid by way of manufactured interest or manufactured overseas dividend, and

ii

the tax required to be accounted for in connection with the making of that payment,

would exceed the gross amount (as determined in accordance with paragraph 3 or 4 above) of the interest or overseas dividend of which it is representative, as the case may be,

the payment shall, to the extent of an amount equal to the excess, not be regarded for the purposes of this Schedule as made in discharge of the requirement referred to in paragraph 2(1), 3(1) or 4(1) above, as the case may be, but shall instead to that extent be taken for all purposes of the Tax Acts to constitute a separate fee for entering into the contract or other arrangements under which it was made, notwithstanding anything in paragraphs 2 to 4 above.

2

Dividend manufacturing regulations may make provision in such circumstances and for such purposes of the Tax Acts as may be prescribed for such a fee as is mentioned in sub-paragraph (1) above to be treated as paid in any case that would fall within that sub-paragraph, apart from paragraph 5 above; and, without prejudice to the generality of the foregoing, any such regulations may in particular provide—

a

for the amount of the fee to be determined in accordance with the regulations, and

b

for such of the persons mentioned in that paragraph as may be prescribed to be treated as paying or, as the case may be, as receiving the fee,

and it is immaterial for the purposes of paragraph (b) above whether or not the person prescribed would, apart from paragraph 5 above, have been regarded by virtue of sub-paragraph (1) above as paying or receiving a fee, or as paying it to, or receiving it from, any other person prescribed under paragraph (b) above.

3

For the purpose of giving relief under any provision of the Tax Acts in a case falling within paragraph 3(1) or 4(1) above where (apart from this paragraph) the aggregate referred to in sub-paragraph (1)(b) above would be less than the gross amount there mentioned—

a

the gross amount of the manufactured interest or manufactured overseas dividend shall be taken to be an amount equal to the aggregate referred to in sub-paragraph (1)(b) above, except where paragraph 6 above applies, and

b

where paragraph 6 above applies, the gross amount of the manufactured interest or manufactured overseas dividend shall be taken to be only the amount referred to in sub-paragraph (1)(b)(i) above,

notwithstanding anything in paragraph 3, 4 or 6 above.

4

In this paragraph “relief means relief by way of—

a

deduction in computing profits or gains; or

b

deduction or set off against income or total profits.

Dividend manufacturing regulations: general

8

1

Dividend manufacturing regulations may make provision for—

a

such manufactured dividends, manufactured interest or manufactured overseas dividends as may be prescribed, or

b

such dividend manufacturers, interest manufacturers or overseas dividend manufacturers as may be prescribed,

to be treated in prescribed circumstances otherwise than as mentioned in paragraph 2, 3 or 4 above for the purposes of such provisions of the Tax Acts as may be prescribed.

2

Dividend manufacturing regulations may make provision with respect to—

a

the accounts and other records which are to be kept,

b

the vouchers which are to be issued or produced,

c

the returns which are to be made,

d

the manner in which amounts required to be deducted or accounted for under or by virtue of this Schedule on account of tax are to be accounted for and paid,

by dividend manufacturers, interest manufacturers or overseas dividend manufacturers in connection with the manufacturing of dividends, interest or overseas dividends.

3

Dividend manufacturing regulations may—

a

make provision for prescribed provisions of the Management Act to apply in relation to manufactured dividends, manufactured interest or manufactured overseas dividends with such modifications, specified in the regulations, as the Treasury think fit;

b

make such further provision with respect to the administration, assessment, collection and recovery of amounts required to be deducted or accounted for under or by virtue of this Schedule on account of tax as the Treasury think fit.

4

Dividend manufacturing regulations may make different provision for different cases.

Power to obtain information in connection with dealings in securities

F1212

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

Manufactured dividends etc: amendments of section 737

F1223

  • . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Consequential provisions

F1234

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

F124SCHEDULE 14

Annotations:
Amendments (Textual)
F124

Sch. 14 repealed (22.3.2001 with effect as mentioned in s. 579(1) of the amending Act) by 2001 c. 2, s. 580, Sch. 4

Part I INDUSTRIAL BUILDINGS AND STRUCTURES

Buildings and structures in enterprise zones

1

In section 1 of the M31Capital Allowances Act 1990 (enterprise zones) after subsection (1) there shall be inserted—

1A

Where the person entitled to the relevant interest in relation to any capital expenditure incurred as mentioned in paragraphs (a) and (b) of subsection (1) above incurs an additional VAT liability in respect of any of that capital expenditure at a time when—

a

the building or structure is, or is to be, an industrial building or structure occupied as mentioned in paragraph (a) of that subsection, and

b

the site of the building or structure is in an enterprise zone and not more than 10 years have elapsed since the site was first included in the zone,

that liability shall be regarded for the purposes of this Act as capital expenditure incurred on the construction of the building or structure and, subject to the following provisions of this Act, an allowance shall accordingly be made to him under that subsection for the chargeable period related to the incurring of that liability.

Transitional relief for regional projects

2

1

In section 2 of that Act, in subsection (1) (which applies section 1, with modifications, in relation to certain regional projects) after paragraph (a) there shall be inserted—

aa

in subsection (1A)—

i

for the words “paragraphs (a) and (b) there shall be substituted the words “paragraph (a); and

ii

paragraph (b) shall be omitted; and

2

After subsection (3) of that section there shall be inserted—

3A

This section also applies to any additional VAT liability incurred in respect of expenditure certified under subsection (2) or (3) above.

Writing-down allowances

3

1

In section 3 of that Act (writing-down allowances in respect of industrial buildings and structures) after subsection (2) there shall be inserted—

2A

Where the person entitled to the relevant interest in relation to any capital expenditure incurred on the construction of a building or structure incurs an additional VAT liability in respect of any of that capital expenditure, then—

a

that liability shall be regarded for the purposes of this Act as capital expenditure incurred by him on the construction of the building or structure, and

b

the residue (as defined in section 8(1)) of the expenditure incurred on the construction of the building shall accordingly be deemed for the purposes of this Part to be increased as at the time at which the liability is incurred by an amount equal to the liability.

2B

Where an additional VAT liability is incurred as mentioned in subsection (2A) above, then (subject to any further adjustment under this subsection on any later such event or under subsection (2C) or (3) below) the writing-down allowance for any chargeable period, if that chargeable period or its basis period ends after the time at which the liability is incurred, shall be the residue of the capital expenditure immediately after the incurring of the liability, reduced in the proportion (if it is less than one) which the length of the chargeable period bears to the part unexpired, at the date of the incurring of the liability, of the period of 25 years beginning with the time when the building or structure was first used.

2C

In any case where—

a

an additional VAT rebate in respect of any capital expenditure incurred on the construction of a building or structure is made to the person entitled to the relevant interest in relation to that expenditure, and

b

the residue of that expenditure immediately before the making of the rebate is not less than the amount of the rebate,

then (subject to any further adjustment under this subsection on any later such event or under subsection (2B) above or (3) below) the writing-down allowance for any chargeable period, if that chargeable period or its basis period ends after the time at which the rebate is made, shall be the residue of that expenditure immediately after the making of the rebate, reduced in the proportion (if it is less than one) which the length of the chargeable period bears to the part unexpired, at the date of the making of the rebate, of the period of 25 years beginning with the time when the building or structure was first used.

2

In subsection (3) of that section (sale of relevant interest: recalculation of future writing-down allowances) after the words “on a later sale there shall be inserted the words “or under subsection (2B) or (2C) above ”.

Balancing allowances and balancing charges

4

1

In section 4 of that Act, in subsection (1) (events which give rise to balancing allowances and balancing charges), after paragraph (d) there shall be inserted the words

or

e

an additional VAT rebate in respect of any of the capital expenditure is made to the person entitled to the relevant interest,

2

In subsection (2) of that section (no balancing allowance or charge on second or subsequent events when the building or structure is not an industrial building or structure) after the words “and where two or more events there shall be inserted the words “falling within paragraphs (a) to (d) of subsection (1) above ”.

3

After that subsection there shall be inserted—

2A

No balancing allowance shall be made by reason of an event falling within paragraph (e) of subsection (1) above; and no balancing charge shall be made by reason of such an event unless—

a

the amount of the additional VAT rebate exceeds the residue of expenditure immediately before the making of that rebate, or

b

there is no such residue,

and in any such case a balancing charge shall be made on an amount equal to that by which the rebate exceeds the residue of expenditure immediately before the making of the rebate or, where there is no such residue, to the amount of the rebate.

4

In subsection (9) of that section, in the definition of “the capital expenditure there shall be added at the end of paragraph (a) the words “ reduced by an amount equal to that of any balancing charge made in relation to that expenditure on the occurrence of an event falling within subsection (1)(e) above; ”.

5

At the end of subsection (10) of that section (balancing charge not to exceed allowances made) there shall be added the words “reduced by the amounts (if any) on which balancing charges in respect of the expenditure have been made on him for any such chargeable periods ”.

Writing off of expenditure and meaning of “residue of expenditure

5

1

In section 8 of that Act, for subsection (2) (initial allowances to be treated as written off when building or structure first used) there shall be substituted—

2

Where an initial allowance is made in respect of any of the expenditure, then—

a

if that allowance is made in respect of an additional VAT liability incurred after the building or structure is first used, the amount of that allowance shall be treated as written off as at the time at which the liability is incurred; and

b

in any other case, the amount of the allowance shall be treated as written off as at the time when the building or structure is first used.

2

After subsection (12) of that section there shall be inserted—

12A

Where an additional VAT rebate is made in respect of any of the expenditure, there shall be treated as written off as at the time at which the rebate is made an amount equal to the rebate.

3

In subsection (13) (application of subsections (1) to (12) to the Crown) for “(12) there shall be substituted “(12A) ”.

Part II MACHINERY AND PLANT

Transitional relief for regional projects

6

1

In section 22 of that Act (first-year allowances: transitional relief for regional projects) after subsection (1) there shall be inserted—

1A

Subsection (1B) below applies in any case where a person—

a

has at any time incurred, as mentioned in paragraphs (a) and (b) of subsection (1) above, capital expenditure to which this section applies, and

b

subsequently incurs an additional VAT liability in respect of that capital expenditure at a time when the machinery or plant is provided wholly and exclusively for the purposes of the trade.

1B

Where this subsection applies, then, for the purposes of this Act—

a

the additional VAT liability shall be regarded as capital expenditure incurred by the person on the provision of the machinery or plant wholly and exclusively for the purposes of the trade, and

b

that capital expenditure shall be regarded as expenditure in consequence of the incurring of which the machinery or plant belongs, or has belonged, to him at some time during the chargeable period related to the incurring of the capital expenditure,

and, subject to the following provisions of this Act, a first-year allowance shall accordingly be made to him under subsection (1) above for the chargeable period related to the incurring of that liability.

2

After subsection (3) of that section there shall be inserted—

3A

This section also applies to any additional VAT liability incurred in respect of expenditure certified under subsection (2) or (3) above.

Writing-down allowances and balancing adjustments

7

1

In section 24 of that Act, after subsection (1) (expenditure on machinery or plant qualifying for writing-down allowances) there shall be inserted—

1A

If, in a case where the circumstances are as mentioned in paragraphs (a) and (b) of subsection (1) above, the person there mentioned incurs an additional VAT liability in respect of the capital expenditure at a time when the machinery or plant is provided wholly and exclusively for the purposes of the trade, then, for the purposes of this Act—

a

that liability shall be regarded as capital expenditure incurred by him on the provision of the machinery or plant wholly and exclusively for the purposes of the trade, and

b

that capital expenditure shall be regarded as expenditure in consequence of the incurring of which the machinery or plant belongs, or has belonged, to him,

and, subject to the following provisions of this Act, subsection (1) above shall have effect accordingly in relation to the capital expenditure constituted by that liability.

2

At the beginning of subsection (6) of that section (disposal value) there shall be inserted the words “Subject to subsection (7) below, ” and after that subsection there shall be inserted—

7

This subsection applies to all machinery and plant—

a

on the provision of which for the purposes of the trade a person has incurred capital expenditure;

b

which belongs to him at some time in a chargeable period or its basis period; and

c

in respect of which the following event occurs, namely, the making of an additional VAT rebate to him in that chargeable period or its basis period in respect of the capital expenditure incurred by him on the provision of the machinery or plant;

and where this subsection applies to any machinery or plant the amount that is to be brought into account by virtue of subsection (6) above by that person for the chargeable period related to the making of the rebate shall be increased by the addition of (or, if there would not otherwise be a disposal value for that chargeable period, shall be) the disposal value of the machinery or plant in respect of which that rebate is made.

8

Except in subsection (7) above, any reference in this Act to subsection (6) above (but not a reference to any specific provision of it) shall be taken to include a reference to subsection (7) above.

The disposal value

8

1

In section 26 of that Act (which defines the disposal value by reference to the event giving rise to it) in subsection (1), after paragraph (e) there shall be inserted—

ee

if that event is the making of an additional VAT rebate in respect of capital expenditure incurred on the provision of the machinery or plant, equals the amount of that rebate; and

2

At the end of subsection (2) of that section (disposal value not to exceed expenditure on the provision of the machinery or plant for the purposes of the trade) there shall be added the words—

reduced by the aggregate amount of any additional VAT rebates made to him in respect of any of that capital expenditure.

2A

If the event by reason of which a disposal value is to be brought into account is the making of an additional VAT rebate to a person, subsection (2) above shall have effect as if the capital expenditure referred to in that subsection were reduced (or further reduced) by the amount of any disposal value brought into account by that person in respect of the machinery or plant by reason of any earlier event (other than the making of an additional VAT rebate).

3

At the end of that section there shall be added—

4

Where an additional VAT rebate has been made to any of the persons mentioned in subsection (3) above in respect of the capital expenditure incurred by him as there mentioned, that capital expenditure shall, in his case, be treated as reduced by the amount of the rebate, but no further reduction shall be made under subsection (2) above.

Short-life assets

9

1

In section 37 of that Act, after subsection (4) (allowances for the notional trade to be given for the corresponding period of the actual trade) there shall be inserted—

4A

In any case where—

a

a balancing allowance that would, on the assumptions in subsection (3) above, fall to be made to the trader for a chargeable period in the case of the notional trade has, by virtue of subsection (4) above, been made to him for a chargeable period in the case of the actual trade,

b

after the chargeable period of the notional trade related to its permanent discontinuance for the purposes of sections 24, 25 and 26, he incurs an additional VAT liability in respect of the capital expenditure incurred on the provision of the machinery or plant, and

c

that liability was not brought into account in determining the amount of the balancing allowance,

a further balancing allowance, of an amount equal to the liability, shall be made to him for the chargeable period of the actual trade related to the incurring of the liability (and the liability shall not be brought into account for any chargeable period in the case of the notional trade).

2

In subsection (5) of that section (no disposal value brought into account before fourth anniversary) after the word “If there shall be inserted the words “disregarding section 24(7) ”.

Fixtures

F16810. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Further restrictions on allowances

11

1

In section 75 of that Act (connected persons etc) in subsection (1) (provision by purchase of machinery or plant)—

a

after the words “in respect of the expenditure there shall be inserted the words “or any additional VAT liability incurred in respect of it ”; and

b

for the words “so much (if any) of the expenditure there shall be substituted the words “so much (if any) of the aggregate of the expenditure and any such additional VAT liability ”.

2

In subsection (2) of that section (contracts under which a person will or may become the owner of machinery or plant)—

a

after the words “so far as relating to that machinery or plant there shall be inserted the words “or in respect of any additional VAT liability incurred by him in respect of any such expenditure ”; and

b

for the words “so much (if any) of the expenditure there shall be substituted the words “so much (if any) of the aggregate of the expenditure and any such additional VAT liability ”.

3

In subsection (3) of that section (assignment of benefit of such contracts)—

a

after the words “consideration for the assignment there shall be inserted the words “or in respect of any additional VAT liability incurred by him in respect of any such expenditure ”; and

b

for the words “so much (if any) of the assignee’s expenditure there shall be substituted the words “so much (if any) of the aggregate of the assignee’s expenditure and any such additional VAT liability ”.

4

In section 76 of that Act (extension of section 75) after subsection (2) (provision for open market value etc to be brought into account where there is no disposal value) there shall be inserted—

2A

In any case where—

a

section 75(1) has effect with the modification specified in paragraph (a) of subsection (2) above, but

b

the open market value of the machinery or plant in question is determined for the purposes of those provisions inclusive of value added tax,

section 75(1) as so modified shall have effect with the omission of the words “the aggregate of and “and any such additional VAT liability.

2B

For the purposes of paragraphs (b) and (c) of subsection (2) above—

a

any additional VAT liability incurred by the seller or, as the case may be, any person connected with him in respect of capital expenditure incurred on the provision of the machinery or plant shall be regarded as capital expenditure incurred on the provision of the machinery or plant, and

b

any additional VAT rebate made to the seller or, as the case may be, any person connected with him in respect of any such expenditure shall be regarded as reducing the amount of capital expenditure so incurred by him,

to the extent that the liability or rebate in question would not, apart from this subsection, fall to be so regarded.

5

In subsection (4) of that section (application of subsections (2) and (3) in relation to section 75(2) and (3)) for the words “Subsections (2) and (3) there shall be substituted the words “Subsections (2), (2A), (2B) and (3) ”.

Part III SCIENTIFIC RESEARCH

Deduction for additional VAT liability on capital expenditure

12

1

In section 137 of that Act (deductions for capital expenditure on scientific research) after subsection (1) there shall be inserted—

1A

Where a person—

a

has incurred allowable scientific research expenditure of a capital nature as mentioned in paragraph (a) or (b) of subsection (1) above, and

b

incurs an additional VAT liability in respect of that expenditure at any time before the relevant event (as defined in section 138(1)) occurs in relation to the asset in question,

that liability shall, subject to the following provisions of this section, be regarded for the purposes of this Act as expenditure of a capital nature incurred on the scientific research.

2

In subsection (3) of that section (relief where scientific building contains a dwelling to which not more than one quarter of the cost is referable) after the words “consists of a dwelling and there shall be inserted the words “,disregarding any additional VAT liability or rebate, ”.

Charge in respect of additional VAT rebate on capital expenditure

13

1

In section 138 of that Act, after subsection (2) (charge where asset ceases to belong to trader) there shall be inserted—

2A

Where one or more additional VAT rebates have been made in respect of the expenditure at any time before the relevant event, the amount of the allowance and the amount of the expenditure shall each be treated for the purposes of subsection (2)(a) and (b) above as reduced by the aggregate amount of such of those rebates as fell, or fall, to be treated as trading receipts under subsection (3A) below.

2

After subsection (3) of that section there shall be inserted—

3A

In any case where—

a

a person carrying on a trade has incurred allowable scientific research expenditure of a capital nature as mentioned in paragraph (a) or (b) of section 137(1), and

b

an additional VAT rebate in respect of that expenditure is made to him at any time before the relevant event occurs in relation to the asset in question,

then, unless that rebate falls to be brought into account for the purpose of making allowances and charges under Part I or Part II, an amount equal to the rebate shall be treated as a trading receipt of the trade accruing for the chargeable period related to the making of the rebate or, if the rebate is made on or after the date on which the trade is permanently discontinued, accruing immediately before the discontinuance.

3

At the end of that section there shall be added—

8

For the purposes of subsections (2) and (3) above, any question arising whether the relevant event occurred in or after, or (as the case may be) before, the chargeable period for which an allowance is given in respect of the expenditure there mentioned shall be determined without reference to the making of any allowance by virtue of section 137(1A); but this subsection is without prejudice to any question as to the amount of the expenditure or of the allowance for the purposes of those subsections.

Part IV SUPPLEMENTARY PROVISIONS

General provisions about additional VAT liabilities and rebates

14

In section 159 of that Act, in subsection (2) (time when capital expenditure is incurred) after the words “capital expenditure there shall be inserted the words “(other than that constituted by an additional VAT liability) ” and after that section there shall be inserted—

159A Additional VAT liabilities and rebates.

1

Subject to subsections (3) and (4) below, any additional VAT liability or rebate arising is to be regarded for the purposes of this Act as incurred or made on the last day of the relevant VAT interval.

2

For the purposes of subsection (1) above “the relevant VAT interval, in relation to an additional VAT liability or rebate, means that one of the periods of which, under the VAT capital items legislation, the VAT period of adjustment applicable to the asset in question consists, in which occurred the increase or decrease in use which gave rise to the liability or rebate.

3

An additional VAT liability or rebate shall, for the purpose only of determining the chargeable period—

a

for which an allowance or charge under this Act may be made in respect of that liability or rebate, or

b

in which the amount of that liability or rebate is to be brought into account in connection with the making of such allowances or charges,

be regarded as incurred or made at a time determined in accordance with subsection (4) below and, except for that purpose, any such liability or rebate shall not be treated as incurred or made otherwise than on the day on which it is to be regarded as incurred or made by virtue of subsection (1) above.

4

For the purpose of determining the chargeable period referred to in subsection (3) above—

a

where a return for the purposes of value added tax is made to the Commissioners of Customs and Excise in which the liability or rebate is accounted for, the liability or rebate shall be regarded as incurred or made in the chargeable period or its basis period which includes the last day of the period to which that return relates; but

b

if, before any such return is made, those Commissioners assess the liability or rebate as due or repayable, then, notwithstanding paragraph (a) above, the liability or rebate shall be regarded as incurred or made on the day on which that assessment is made; and

c

if the additional VAT liability or rebate has not been accounted for on a return for the purposes of value added tax to those Commissioners, or assessed by them for those purposes, before the trade in question has been permanently discontinued or treated by any provision of the Tax Acts as permanently discontinued, then, notwithstanding paragraphs (a) and (b) above, the liability or rebate shall be regarded as incurred or made on the last day of the chargeable period related to the discontinuance.

5

Where, disregarding any additional VAT liability or rebate, any allowance or charge falling to be made under this Act in respect of any capital expenditure falls, under any provision of this Act, to be determined by reference to—

a

a proportion only of that expenditure, or

b

a proportion only of what that allowance or charge would have been apart from that provision,

then, to the extent that so much of any allowance or charge as falls to be so made in respect of any additional VAT liability or rebate in respect of that expenditure would not (apart from this subsection) fall to be determined by reference to that proportion of the liability or rebate or, as the case may be, of what that portion of the allowance or charge would otherwise have been, it shall be so determined.

6

In this Act—

  • “additional VAT liability, in relation to any capital expenditure (or any expenditure of a capital nature), means an amount which a person becomes liable to pay by way of adjustment under any VAT capital items legislation in respect of input tax on an asset on the construction or provision of which the expenditure in question was incurred in whole or in part;

  • “additional VAT rebate, in relation to any capital expenditure (or any expenditure of a capital nature), means an amount which a person becomes entitled to deduct by way of adjustment under any VAT capital items legislation in respect of input tax on an asset on the construction or provision of which the expenditure in question was incurred in whole or in part;

  • “VAT capital items legislation means any provisions of any Act or instrument (whenever passed or made) which provide, in relation to value added tax—

a

for the proportion of input tax on an asset of a specified description which may be deducted by a person from his output tax to be adjusted from time to time in consequence of any increase or decrease in the extent to which the asset is used by him for the making of taxable supplies, or taxable supplies of a specified class or description, over a specified period (a “VAT period of adjustment) applicable to the asset, or

b

otherwise for the purpose of giving effect to Article 20(2) to (4) of the Sixth Directive of the Council of the European Communities on Value Added Tax, dated 17th May 1977,

and for this purpose “taxable supply has the same meaning as it has in the Value Added Tax Act 1983 by virtue of section 2(2) of that Act;

“VAT period of adjustment has the meaning given in the definition of VAT capital items legislation.

7

In this section—

a

“input tax and “output tax have the meaning given by section 14 of the Value Added Tax Act 1983; and

b

in the application of subsection (4)(c) above for the purposes of Part II, the reference to the trade in question shall be construed in accordance with section 27 as that section would apply if this section were included in that Part.

SCHEDULE 15 RELIEF FOR COMPANY TRADING LOSSES

Section 73.

The Taxes Management Act 1970 (c. 9)

1

1

In section 86 of the Taxes Management Act 1970 (interest on overdue tax) after subsection (2) there shall be inserted—

2A

In any case where—

a

on a claim under section 393A(1) of the principal Act, the whole or any part of a loss incurred in an accounting period (the “later period) is set off for the purposes of corporation tax against profits of a preceding accounting period (the “earlier period),

b

the earlier period does not fall wholly within the period of twelve months immediately preceding the later period, and

c

if the claim had not been made, an amount of corporation tax assessed for the earlier period would carry interest in accordance with this section,

then, in determining the amount of interest payable under this section on corporation tax unpaid for the earlier period, no account shall be taken of any reduction in the amount of that tax which results from the claim, except so far as concerns interest for any time after the day following the expiry of the period of nine months from the end of the later period.

2

The subsection (2A) inserted by sub-paragraph (1) above shall be omitted where the accounting period referred to in that subsection as the earlier period ends after the appointed day for the purposes of section 86 of the M29Finance (No.2) Act 1987 so far as relating to the omission of section 86(2)(d) of the Taxes Management Act 1970.

F1252

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

The Income and Corporation Taxes Act 1988 (c. 1)

F2193

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

F2344

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

F1265

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

F1276

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

F2357

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

F2358

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

F1289

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

Annotations:
Amendments (Textual)
F128

Sch. 15 para. 9 repealed (27.7.1993 with effect in relation to accounting periods ending after the day appointed for the purposes of s. 10 of the Income and Corporation Taxes Act 1988) by 1993 c. 34, s. 213, Sch. 23 Pt.III.

F22310

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

F22311

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

F22312

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

F12913

  • . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F23614

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

F24215

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

F21216

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

F23717

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

F13018

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

F22419

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

F22420

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

F22421

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

22

In section 825 of that Act, in subsection (4) (restrictions on repayment supplement) after paragraph (b) there shall be added the words

and

c

a repayment of corporation tax or income tax falling to be made as a result of a claim under section 393A(1) to have the whole or any part of a loss incurred in an accounting period set off against profits of an earlier accounting period ( “the earlier period)—

i

shall, in a case where the earlier period falls wholly within the period of twelve months immediately preceding the accounting period in which the loss was incurred, be treated as a repayment of tax paid for the earlier period; and

ii

in any other case, shall be treated as a repayment of tax paid for the accounting period in which the loss is incurred; and

d

a payment of the whole or part of a tax credit falling to be made as a result of a claim under section 242, to the extent that a surplus of franked investment income for an accounting period (the “earlier period) is treated as there mentioned for the purpose of setting a loss incurred in a later accounting period against total profits under section 393A(1)—

i

shall, in a case where the earlier period falls wholly within the period of twelve months immediately preceding the accounting period in which the loss is incurred, be treated as a payment in respect of franked investment income received in the earlier period; and

ii

in any other case, shall be treated as a payment in respect of franked investment income received in the accounting period in which the loss is incurred.

23

In section 826 of that Act (interest on tax overpaid) after subsection (7) there shall be inserted—

7A

In any case where—

a

a company carrying on a trade incurs a loss in the trade in an accounting period ( “the later period),

b

as a result of a claim under section 393A(1), the whole or any part of that loss is set off for the purposes of corporation tax against profits (of whatever description) of an earlier accounting period ( “the earlier period) which does not fall wholly within the period of twelve months immediately preceding the later period, and

c

a repayment falls to be made of corporation tax paid for the earlier period or of income tax in respect of a payment received by the company in that accounting period,

then, in determining the amount of interest (if any) payable under this section on the repayment referred to in paragraph (c) above, no account shall be taken of any increase in the amount of that repayment as a result of the claim under section 393A(1), except so far as concerns interest for any time after the date on which any corporation tax for the later period became (or, as the case may be, would have become) due and payable, as mentioned in subsection (2) above.

7B

In any case where—

a

a company carrying on a trade incurs a loss in the trade in an accounting period ( “the later period),

b

as a result of a claim under section 242, the whole or any part of a surplus of franked investment income for an earlier accounting period (the “earlier period) which does not fall wholly within the period of twelve months immediately preceding the later period is treated as there mentioned for the purpose of setting the loss against total profits under section 393A(1), and

c

a payment falls to be made of the whole or part of a tax credit comprised in franked investment income received by the company in the earlier period,

then, in determining the amount of interest (if any) payable under this section on the payment referred to in paragraph (c) above, no account shall be taken of any increase in the amount of that payment as a result of the claim under section 242 (to the extent that that section relates to section 393A(1)), except so far as concerns interest for any time after the date on which any corporation tax for the later period became (or, as the case may be, would have become) due and payable, as mentioned in subsection (2) above.

24

In section 843 of that Act (commencement) in subsection (4) (exceptions in the case of certain provisions which include section 394) “394” shall be omitted.

25

In Schedule 5 to that Act (treatment of farm animals etc for purposes of Case I of Schedule D) in paragraph 2(3)(a) (election for herd basis to be valid only if made not later than two years after end of the first chargeable period in which relief under section 393(2) given etc) after “393(2)” there shall be inserted “or 393A(1) ”.

F13126

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

27

1

In Schedule 30 to that Act (transitional provisions and savings) in paragraph 2 (duration of leases) in sub-paragraph (2)(a) (section 38 deemed to have effect as from passing of M30Finance Act 1963 in respect of relief under section 385 or 393) after “393” there shall be inserted the words “or 393A(1) ”.

2

In paragraph 3 of that Schedule (duration of leases) in sub-paragraph (1)(b) (sections 24 and 38 to have effect subject to modifications except to extent that section 38 relates to relief under section 385 or 393) after “393” there shall be inserted the words “or 393A(1) ”.

The Capital Allowances Act 1990 (c. 1)

F13228

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

F150SCHEDULE 16

Annotations:
Amendments (Textual)
F150

Sch. 16 repealed (6.3.1992 with effect as mentioned in s. 289(1)(2) of the repealing Act) by Taxation of Chargeable Gains Act 1992 (c. 12), ss. 289, 290, Sch.12 (with s. 201(3), Sch. 11 paras. 20, 22, 26(2), 27)

Conditions for the charge

F1331

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

The charge

F1342

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

Construction of paragraph 1(1)(e)

3 F135

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

Test whether settlor has interest

F1364

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

Exceptions to charge

5 F137

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

F1386

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

F1397

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

Right of recovery

F1408

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

Meaning of “settlor”

F1419

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

Meaning of “originating”

F14210

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

Qualifying settlements, and commencement

F14311

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

Information

F14412

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

F14513

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

F14614

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

F14715

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

F14816

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

F14917

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

F160SCHEDULE 17

Annotations:
Amendments (Textual)
F160

Sch. 17 repealed (6.3.1992 with effect as mentioned in s. 289(1)(2) of the repealing Act) by Taxation of Chargeable Gains Act 1992 (c. 12), ss. 289, 290, Sch. 12 (with s. 201(3), Sch. 11 paras. 20, 22, 26(2), 27)

Introduction

F1511

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

Qualifying amounts

F1522

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

Matching capital payments

F1533

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

Increased tax: the main rule

F1544

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

More than one qualifying amount

F1555

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

Payment partly ignored

F1566

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

Parts of amounts matched

F1577

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

Transfers between settlements

F1588

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

Matching after transfer

F1599

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

F167SCHEDULE 18

Annotations:
Amendments (Textual)
F167

Sch. 18 repealed (6.3.1992 with effect as mentioned in s. 289(1)(2) of the repealing Act) by Taxation of Chargeable Gains Act 1992 (c. 12), ss. 289, 290, Sch. 12 (with s. 201(3), Sch. 11 paras. 20, 22, 26(2), 27)

Computation rules

F1611

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

Dual-resident settlements

F1622

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

F1633

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

Payments by and to companies

F1644

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

Beneficiaries

F1655

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

Other amendments

F1666

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

I11SCHEDULE 19 REPEALS

Section 123.

Annotations:
Commencement Information
I11

Sch. 19 partly in force at 1.12.1988 due to commencement of Part VI

Part I BETTING AND GAMING DUTIES

Chapter

Short title

Extent of repeal

1981 c. 63.

The Betting and Gaming Duties Act 1981.

In section 14(1)(b), the words “payable after the end of that period and””.

In Schedule 2, in paragraph 5, in sub-paragraph (1), the words “of the duty”” and, in sub-paragraph (2), the word “duty”” and, in paragraph 6(1), “(3)(c)””.

Part II BEER DUTY

Chapter

Short title

Extent of repeal

1979 c. 4.

The Alcoholic Liquor Duties Act 1979.

In section 1(3), paragraph (b) and the word “or”” immediately preceding it.

Section 2(6).

In section 3, in subsection (3), the words “Subject to subsection (5) below””, and subsection (5).

In section 4(1), the definitions of “brewer”” and “brewer for sale”” and of “limited licence to brew beer””.

Sections 37 to 40.

Section 45(2).

Section 50.

Section 53.

Sections 71A and 72.

1982 c. 39.

The Finance Act 1982.

Section 9(3) and (4).

1985 c. 54.

The Finance Act 1985.

In Schedule 3, paragraphs 3 and 4.

1986 c. 41.

The Finance Act 1986.

Section 4(1).

In section 8(2)(a), the words “47(3), 48(2)””.

1988 c. 39.

The Finance Act 1988.

In Schedule 1, in Part II, paragraphs 1(2), 2(2), 3 and 11.

1989 c. 26.

The Finance Act 1989.

Section 3.

These repeals have effect in accordance with section 7 of this Act.

Part III VEHICLES EXCISE DUTY: GENRAL

Chapter

Short title

Extent of repeal

1971 c. 10.

The Vehicles (Excise) Act 1971.

In section 4(1)(ka), the words “(other than mowing machines)””.

Section 7(4).

Section 38(4).

Schedule 6.

1972 c. 10 (N.I.).

The Vehicles (Excise) Act (Northern Ireland) 1972.

In section 4(1)(ka), the words “(other than mowing machines)””.

Section 7(4).

Section 35(4).

Schedule 7.

1982 c. 39.

The Finance Act 1982.

Section 5(6).

Section 6(7).

1985 c. 54.

The Finance Act 1985.

In Schedule 2, in Part I, paragraph 1.

1

The repeals in section 4 of each of the Vehicles (Excise) Act 1971 ( “the 1971 Act) and the Vehicles (Excise) Act (Northern Ireland) 1972 ( “the 1972 Act) are deemed to have come into force on 20th March 1991.

2

The repeals of section 7(4) of each of the 1971 Act and the 1972 Act come into force on 1st October 1991.

3

The repeals of section 38(4) of, and Schedule 6 to, the 1971 Act, section 35(4) of, and Schedule 7 to, the 1972 Act and sections 5(6) and 6(7) of the Finance Act 1982, so far as relating to the application of those provisions for the purpose of section 4(1)(g) of either the 1971 Act or the 1972 Act, are deemed to have come into force on 20th March 1991.

4

The repeal in Schedule 2 to the Finance Act 1985, and the repeals mentioned in note 3 above so far as relating to the application of the repealed provisions for the purpose of any provision of the 1971 Act or the 1972 Act other than section 4(1)(g), have effect in relation to licences taken out after 20th March 1991.

I10Part IV VEHICLE EXCISE DUTY: NORTHERN IRELAND

Annotations:
Commencement Information
I10

Sch. 19 Pt. IV: s. 10 wholly in force (1.10.1991) see s.10(3) and S.I. 1991/2021, art.2

Chapter

Short title

Extent of repeal

Acts of the Parliament of the United Kingdom

1971 c. 10.

The Vehicles (Excise) Act 1971.

Section 7(5).

1974 c. 39.

The Consumer Credit Act 1974.

In Schedule 4, paragraph 50.

1975 c. 7.

The Finance Act 1975.

Section 58.

1975 c. 45.

The Finance (No. 2) Act 1975.

Section 6.

1977 c. 36.

The Finance Act 1977.

Section 6.

1978 c. 42.

The Finance Act 1978.

Section 9.

1979 c. 5.

The Hydrocarbon Oil Duties Act 1979.

In Schedule 1, paragraph 5.

1980 c. 48.

The Finance Act 1980.

Section 5.

1981 c. 35.

The Finance Act 1981.

Section 8.

1982 c. 39.

The Finance Act 1982.

Sections 6 and 7(2) and (4).

Schedule 4 and, in Schedule 5, Part B.

1983 c. 28.

The Finance Act 1983.

Section 4(6) and (7).

In Schedule 3, paragraphs 7 and 12.

1984 c. 43.

The Finance Act 1984.

Section 5(4).

1986 c. 41.

The Finance Act 1986.

Section 3(5).

In Schedule 2, Part II.

1987 c. 16.

The Finance Act 1987.

Section 2(4).

In Schedule 1, paragraphs 6, 9, 11, 13, 15, 17, 19 and 21.

1988 c. 39.

The Finance Act 1988.

Section 4(5).

In Schedule 2, paragraph 6.

1989 c. 26.

The Finance Act 1989.

Section 14(2), (4) and (6).

1990 c. 29.

The Finance Act 1990.

Section 5(4) and (6).

In Schedule 2, Part III.

Act of the Parliament of Northern Ireland

1972 c. 10 (N.I.).

The Vehicles (Excise) Act (Northern Ireland) 1972.

The whole Act.

Orders in Council

S.I. 1972/1100 (N.I. 11).

The Finance (Northern Ireland) Order 1972.

Article 1(4).

Part IV.

S.I. 1980/704 (N.I. 6).

The Criminal Justice (Northern Ireland) Order 1980.

In Schedule 1, paragraphs 62 and 63.

S.I. 1981/154 (N.I. 1).

The Road Traffic (Northern Ireland) Order 1981.

In Schedule 7, paragraphs 14 and 15.

S.I. 1981/1675 (N.I. 26).

The Magistrates’ Courts (Northern Ireland) Order 1981.

In Schedule 6, paragraphs 126 and 127.

These repeals have effect in accordance with section 10 of this Act.

Part V INCOME TAX AND CORPORATION TAX

Chapter

Short title

Extent of repeal

1970 c. 9.

The Taxes Management Act 1970.

Section 78(4).

Section 86(2A).

1985 c. 54.

The Finance Act 1985.

In section 68(7A), the word “and”” at the end of paragraph (f).

1988 c. 1.

The Income and Corporation Taxes Act 1988.

In section 76(1)(d), the words “general annuity business””.

In section 114(3), paragraph (c) and the word “and”” immediately preceding it.

In section 243, in subsection (1), the words “or 394”” and subsections (5) and (6)(b).

Section 339A.

In section 343, in subsection (3), the words from the beginning to “subsection (6) below; and””, subsection (6) and, in subsection (7), the words from “then no relief”” to “subject to th at””.

Section 349(3)(e).

Section 354(3).

In section 367(1), the definition of the expression “large carav a n””.

In section 393, subsections (2) to (6) and, in subsection (11), the words from “and a claim under subsection (2)”” onwards.

Section 394.

Section 432A(2)(b) and (d).

In section 436, in subsection (1), the words “general annuity business or””, in subsection (3), in paragraph (c), the words “or general annuity business”” and, in paragraph (e), the words “general annuity business or””, and in subsection (4), the words “general annuity business or””.

Section 437(2) to (5).

In section 446, in subsection (1), the words “and general annuity business”” and subsections (2) and (3).

In section 447, subsection (3) and, in subsection (4), the words “or 446””.

Section 448(3)(a).

In section 465(3) the words “and (c)””.

In section 474(1)(b), the words “and general annuity business””.

Section 518(6).

In section 590, subsections (5) and (6).

Section 726.

In section 737, in subsection (2), the words “otherwise than by virtue of section 476(5)(a)””, and subsection (4).

Section 738(2).

In section 843(4), the words “394””.

In Schedule 5, in paragraph 2(3)(a), the word “or”” immediately following the words “section 380””.

In Schedule 7, paragraphs 3(2) and (3) and 6.

In Schedule 15, paragraph 3(1)(c) and the word “and”” immediately preceding it.

In Schedule 28, paragraph 3(4)(a).

In Schedule 29, in the Table in paragraph 32, the entry relating to section 78(4) of the Taxes Management Act 1970.

In Schedule 30, in paragraph 2(2)(a), the word “or”” where first occurring and, in paragraph 3(1)(b), the word “or””.

1988 c. 39.

The Finance Act 1988.

In Schedule 8, in paragraph 1(3), the word “and”” at the end of paragraph (g).

1989 c. 26.

The Finance Act 1989.

Section 62(2).

Section 63.

Sectio n 87(3).

1990 c. 1.

The Capital Allowances Act 1990.

In section 2(1), the word “and”” at the end of paragraph (a).

In section 3(3), the words “(as defined in section 8(1))””.

In section 26(1), the word “and”” at the end of paragraph (e).

In Schedule 1, paragraph 8(16).

1990 c. 29.

The Finance Act 1990.

Section 25(2)(h).

In section 27, subsections (1) and (3).

Section 61.

In Schedule 6, paragraph 6.

In Schedule 7, paragraph 8.

In Schedule 14, paragraph 7.

1

The repeal of section 78(4) of the Taxes Management Act 1970 and the repeal in Schedule 29 to the Income and Corporation Taxes Act 1988 have effect in accordance with section 81 of this Act.

2

The repeal in section 86 of the Taxes Management Act 1970 has effect in accordance with paragraph 1(2) of Schedule 15 to this Act.

3

The repeals in sections 76, 432A, 436, 437, 446, 447, 448 and 474 of, and Schedule 28 to, the Income and Corporation Taxes Act 1988 and in Schedules 6 and 7 to the Finance Act 1990 have effect for accounting periods beginning on or after 1st January 1992.

4

The following repeals have effect in relation to losses incurred in accounting periods ending on or after 1st April 1991—

a

the repeals in sections 114, 243, 343, 393, 518 and 843 of, the repeals in Schedules 5 and 30 to, and the repeal of section 394 of, the Income and Corporation Taxes Act 1988;

b

the repeal in Schedule 1 to the Capital Allowances Act 1990;

c

the repeal of section 61 of, and the repeal in Schedule 14 to, the Finance Act 1990.

5

The repeals of section 339A of the Income and Corporation Taxes Act 1988 and section 27(1) and (3) of the Finance Act 1990 have effect in relation to accounting periods beginning on or after 19th March 1991.

6

The following repeals have effect for the year 1991-92 and subsequent years of assessment—

a

the repeals of sections 354(3) and 726 of the Income and Corporation Taxes Act 1988;

b

the repeals in sections 367(1) and 737(2) of, and in Schedule 7 to, that Act;

c

the repeal of section 63 of the Finance Act 1989.

7

The repeals in section 465 of, and Schedule 15 to, the Income and Corporation Taxes Act 1988 apply in relation to policies issued in pursuance of contracts made on or after the day on which this Act is passed.

8

The repeal of section 590(5) and (6) of the Income and Corporation Taxes Act 1988 has effect in accordance with section 36 of this Act.

9

The repeals of sections 737(4) and 738(2) of the Income and Corporation Taxes Act 1988 have effect in accordance with section 58 of this Act.

10

The repeal of section 62(2) of the Finance Act 1989 has effect in accordance with section 40 of this Act.

11

The repeals in sections 2(1), 3(3) and 26(1) of the Capital Allowances Act 1990 have effect in relation to any chargeable period or its basis period ending on or after 6th April 1990.

12

The repeal of section 25(2)(h) of the Finance Act 1990 has effect in relation to gifts made on or after 19th March 1991.

Part VI CAPITAL GAINS

Chapter

Short title

Extent of repeal

1970 c. 10.

The Income and Corporation Taxes Act 1970.

In section 342, the words “or Housing for Wales””, in each place where they occur.

In section 342A, the words “or Housing for Wales””, in each place where they occur.

1979 c. 14.

The Capital Gains Tax Act 1979.

Section 126C.

1980 c. 48.

The Finance Act 1980.

Section 80(2).

1981 c. 35.

The Finance Act 1981.

Section 88(2) to (6).

1984 c. 43.

The Finance Act 1984.

Section 63(3).

In section 64(2)(b), the words from “as defined”” to “1973””.

1986 c. 41.

The Finance Act 1986.

Section 58(5).

1988 c. 39.

The Finance Act 1988.

In Schedule 9, in paragraph 3(2)(e), the words from “(postponement”” to “asset)””.

1988 c. 50.

The Housing Act 1988.

In Schedule 17, in Part II, paragraph 93.

1989 c. 26.

The Finance Act 1989.

In Schedule 14, in paragraph 6(5)(c), the words “and (5)””.

1990 c. 29.

The Finance Act 1990.

Section 70(5).

1

The repeals in sections 342 and 342A of the Income and Corporation Taxes Act 1970 and Schedule 17 to the Housing Act 1988 are deemed to have come into force on 1st December 1988.

2

The repeals of section 80(2) of the Finance Act 1980 and section 63(3) of the Finance Act 1984 have effect in relation to disposals on or after 19th March 1991.

3

The repeal in section 64 of the Finance Act 1984 has effect in accordance with section 98 of this Act.

4

The remaining repeals (other than the repeal in Schedule 9 to the Finance Act 1988) have effect in accordance with section 92 of this Act.

Part VII STAMP DUTY

Chapter

Short title

Extent of repeal

9 Geo. 4 c. 80.

The Bankers’ Composition (Ireland) Act 1828.

The whole Act.

54 & 55 Vict. c. 39.

The Stamp Act 1891.

Sections 29, 30 and 31.

In Schedule 1 the heading “bank note””.

1952 c. 13 (N.I.).

The Finance Act (Northern Ireland) 1952.

Sections 4 and 5.

1970 c. 21 (N.I.).

The Finance Act (Northern Ireland) 1970.

Section 7.

In Schedule 2, paragraphs 5 and 18.

1972 c. 41.

The Finance Act 1972.

Section 134(5).

These repeals have effect in accordance with section 115 of this Act.

Part VIII TRADING FUNDS

Chapter

Short title

Extent of repeal

1973 c. 63.

The Government Trading Funds Act 1973.

In section 2(1)(b) and (2), the words “at values or amounts determined by him in accordance with Treasury directions””.