Citation, commencement and effect

1.—(1) This Order may be cited as the Income Tax Act 2007 (Amendment) (No. 2) Order 2007 and shall come into force on 17th July 2007.

(2) This Order has effect—

(a)for income tax purposes, for the tax year 2007-08 and subsequent tax years, and

(b)for corporation tax purposes, for accounting periods ending after 5th April 2007.

Amendments to the Income and Corporation Taxes Act 1988

2.—(1) The Income and Corporation Taxes Act 1988(2) is amended as follows.

(2) In sections 289(9)(d)(3), 291B(10)(4), 293(8AA)(5) and 308(2)(d) for “840” substitute “995 of ITA 2007”.

(3) In section 298(3) for “so much of the definition of “trade” in section 832(1) as relates to adventures or concerns in the nature of trade” substitute “section 989 of ITA 2007 (which defines “trade” as including any venture in the nature of trade)”.

(4) In section 312(1)(6), in the definition of “research and development”, for “837A” substitute “1006 of ITA 2007”.

(5) In section 312(2)(7) for “839” substitute “993 of ITA 2007”.

Amendments to the Finance Act 2002

3.  In the Finance Act 2002(8), in paragraph 12 of Schedule 16 (tax relief certificates), in sub-paragraphs (4) and (5), for “(2)” substitute “(2B)”.

Amendments to the Income Tax Act 2007

4.—(1) The Income Tax Act 2007 is amended as follows.

(2) In section 620(1) (transactions which are transfers: general) for paragraph (c) substitute—

“(c)to the redemption of variable rate securities in any case where there has been a transfer of the securities at any time before redemption, or”.

(3) In paragraph 75(2) of Schedule 2 (transitionals and savings), in the substituted section 294(4), for “qualifying 90% company” substitute “qualifying 90% subsidiary of the relevant company”.

EXPLANATORY NOTE

(This note is not part of the Order)

This Order exercises powers conferred by the Income Tax Act 2007 to make consequential amendments and correct minor errors in the Income and Corporation Taxes Act 1988 (article 2), the Finance Act 2002 (article 3) and the Income Tax Act 2007 itself (article 4).

Authority for the retrospective provision made by this Order is conferred by sections 1028(4) and 1029(4) of the Income Tax Act 2007.

A full regulatory impact assessment has not been produced for this instrument as no impact on the private or voluntary sectors is foreseen.