Finance Act 1973

For the following provisions of the Finance Act 1964 setting out rates of customs and excise duties and of drawback, namely— there shall be substituted the provisions set out in Schedules 1 to 5 to this Act.

In lieu of the duties of customs and excise charged on matches under section 4 of the Finance Act 1951 there shall be charged on matches imported into the United Kingdom a duty of customs, and on matches sent out from the premises of a manufacturer of matches a duty of excise, at the rates shown in Schedule 6 to this Act.

The duties of customs and excise charged on mechanical lighters by section 6 of the Finance Act 1928 shall, instead of being charged at the rates specified in section 8 of the Finance Act 1949 and section 56(3) of the Finance Act 1972, be charged at the rates shown in Schedule 7 to this Act, but no duty shall be chargeable under section 6 of the Act of 1928 on a gas lighter, that is to say a mechanical lighter which is shown to the satisfaction of the Commissioners to be constructed solely for the purpose of igniting gas for domestic use.

The Treasury may by order made before 1st July 1977 make such provision for altering— as may be required to give effect to any Community obligation or any obligation under the Geneva Protocol of 21st December 1972.

An order under the preceding subsection—

An order under subsection (4) of this section shall be made by statutory instrument and may be varied or revoked by a subsequent order; and any such order— In reckoning any such period no account shall be taken of any time during which Parliament is dissolved or prorogued or during which the House of Commons is adjourned for more than four days.

The substitution by or under this section of a rate of drawback for a rate previously in force shall apply only in relation to goods in respect of which duty at the corresponding rate has been paid.

In Schedules 1 to 7 to this Act-

In section 111(1) and section 122 of the Customs and Excise Act 1952 (which provide for remission of duty on spirits in certain cases by reference to the preferential rate) the following paragraphs shall be substituted for paragraphs (a) and (b)—.

This section shall be deemed to have had effect as from 1st April 1973.

The Secretary of State may by regulations make provision for determining, for the purposes of any duty of customs, the origin of any goods in cases where it does not fall to be determined under a Community regulation or any Act or other instrument having the force of law.

Regulations under this section may—

Subject to the provisions of any regulations under this section, where in connection with a duty of customs chargeable on any goods any question arises as to the origin of the goods, the Commissioners may require the importer of the goods to furnish to them, in such form as they may prescribe, proof of any statement made to them as to any fact necessary to determine that question; and if such proof is not furnished to their satisfaction, the question may be determined without regard to that statement.

Regulations under this section shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of the House of Commons.

Where the Commissioners of Customs and Excise are satisfied that purchase tax or a duty to which this section applies was charged on or in respect of goods or on or in respect of parts or ingredients of goods which at the beginning of April 1973 were unused and held by a taxable person for sale in the course of his business, then if— an amount determined or arrived at in accordance with subsection (2) of this section to take account of the tax or duty charged may, in the manner specified in the Notice, be included in the return made by the taxable person under Part I of the Finance Act 1972 for the first prescribed accounting period or, with the sanction of the Commissioners, in such a return made for a later period and shall, if so included, be treated for the purposes of that Part as an amount to be deducted as input tax. In this subsection " sale " includes any supply under a hire-purchase agreement.

The amount that may be so included shall be as follows— and such method may be used in determining that amount, or, if it cannot be determined, in arriving at an appropriate amount to be substituted for it, as the Commissioners may allow.

Where by virtue of this section an amount is treated as input tax to take account of a duty charged, then, if any drawback or repayment falls to be allowed or made in respect of that duty, its amount shall be calculated as if the duty had been charged at the corresponding rate in force on 1st April 1973.

For the purposes of subsections (2)(d), (2)(e) and (3) above, any country's membership of the European Economic Community shall be disregarded.

In relation to duty charged on a gas lighter, the rates in force on 1st April 1973 shall be taken for the purposes of subsections (2)(d), (2)(e) and (3) above to be—

For the purposes of this section goods shall be deemed to be held by a person at the beginning of April 1973 if, and only if, they were— before the end of March 1973 and had not then been supplied by him; and any question whether goods were supplied by or to or were imported by any person before the end of March 1973 shall be determined as, under sections 7 and 47 of the Finance Act 1972, it falls to be determined for the purposes of the charge to value added tax.

This section applies to any duty of customs or excise charged on—

This section shall be deemed to have had effect from the beginning of April 1973.

Subject to subsection (2) below, income tax for the year 1972-73 shall be charged, in the case of an individual whose total income exceeded £3,000, at the same higher rates in respect of the excess of that income over £2,000 as were charged for the year 1971-72.

An individual whose total income for the year 1972-73 did not exceed £3,500 shall be entitled to have the surtax chargeable by virtue of subsection (1) above reduced to an amount equal to 40 per cent, of the difference between his total income and £3,000.

In section 7 of the Taxes Act (relief for persons over sixty-five with small incomes)—

Section 16 of the Taxes Act (relief in respect of dependent relative) shall have effect subject to the following modifications :—

A lump sum paid to a person on his retirement from an office or employment shall not be chargeable to income tax under Schedule E if—

This section shall be deemed always to have had effect.

So far as income arising to trustees is income to which this section applies it shall, in addition to being chargeable to income tax at the basic rate, be chargeable at the additional rate.

This section applies to income arising to trustees in any year of assessment so far as it—

This section also applies to sums apportioned to the trustees under paragraph 1 of Schedule 16 to the Finance Act 1972 and treated, under paragraph 5(2) of that Schedule as applied by subsection (4) below, as income received by the trustees.

Sub-paragraphs (2) and (4) to (8) of paragraph 5 of Schedule 16 to the Finance Act 1972 shall, with the omission in sub-paragraph (2)(a) of the words following " the apportionment relates ", the substitution of " income " for " total income " and all other necessary modifications, apply to a sum apportioned to trustees as they apply to sums apportioned to an individual; and paragraph 6 of that Schedule shall apply accordingly.

For the purposes of this section amounts paid or credited to trustees in any year of assessment in respect of dividends or interest payable in respect of shares in or deposits with or loans to a building society with which arrangements under section 343 of the Taxes Act are in force for that year shall be treated as income for that year received by the trustees after deduction of income tax from a corresponding gross amount. In this subsection expressions used in section 343 of the Taxes Act have the same meanings as in that section.

In this section " trustees" does not include personal representatives ; but where personal representatives, on or before the completion of the administration of the estate, pay to trustees any sum representing income which, if personal representatives were trustees within the meaning of this section, would be income to which this section applies, that sum shall be deemed to be paid to the trustees as income and to have borne income tax (at the basic rate). This subsection shall be construed as if it were contained in Part XV of the Taxes Act.

In relation to the year 1973-74 and subsequent years of assessment there shall be substituted in section 451 of the Taxes Act—

A notice given to trustees under section 8 of the Taxes Management Act 1970 may require a return of the income arising to them to include particulars of the manner in which the income has been applied, including particulars as to the exercise of any discretion and of the persons in whose favour it has been exercised.

Where, in any year of assessment, trustees make a payment to any person in the exercise of a discretion exercisable by them or any person other than the trustees, then, if the sum paid is for all the purposes of the Income Tax Acts income of the person to whom it is paid (but would not be his income apart from the payment), the following provisions of this section shall apply with respect to the payment in lieu of section 52 or 53 of the Taxes Act.

The payment shall be treated as a net amount corresponding to a gross amount from which tax has been deducted at a rate equal to the sum of the basic rate and the additional rate in force for the year in which the payment is made; and the sum treated as so deducted shall be treated—

The following amounts, so far as not previously allowed, shall be set against the amount assessable (apart from this subsection) on the trustees in pursuance of subsection (2)(b) above: but tax on any income represented by amounts paid or credited as mentioned in section 16(5) of this Act after the end of the year 1973-74 shall be taken into account under paragraph (a) above only on production of a certificate from the building society concerned specifying those amounts and stating that an amount representing income tax on that income calculated at the basic rate has been or will be accounted for.

In section 55 of the Taxes Act (certificates of deduction) after the words " section 52, 53 or 54 above " there shall be inserted the words " or section 17 of the Finance Act 1973 ".

In this section " trustees" does not include personal representatives within the meaning of section 432(4) of the Taxes Act.

Subsection (2) of this section shall apply if a payment made by trustees falls to be treated as a net amount in accordance with section 17(2) of this Act and the income arising under the trust includes income in respect of which the trustees are entitled to credit for overseas tax under Part XVIII of the Taxes Act (in that subsection referred to as " taxed overseas income ").

If the trustees certify— the person to whom the payment was made may claim that the payment, up to the amount so certified, shall be treated for the purposes of the said Part XVIII as income received by him from that source and so received in the year in which the payment was made.

Section 286 of the Taxes Act (loans to participators) shall not apply to a loan which, or so much of a loan as.— unless the shares or interests are acquired from, or under arrangements made with, a participator in the company who acquired them neither under an approved share incentive scheme nor, without consideration, as the holder of shares acquired under such a scheme.

Where by virtue of paragraph (a) or (b) of subsection (1) above the application of section 286 of the Taxes Act is excluded in relation to an amount lent by a close company and used by a person satisfying the conditions mentioned therein to acquire shares or interests in shares, then if, at a time when the whole or part of his debt to the company or the trustees is outstanding, he— the company shall be regarded, for the purposes of that section, as making to him at that time a loan of an amount equal, subject to subsection (3) below, to so much of the debt as remains outstanding.

Where, in a case falling within paragraph (b) of subsection (2) above, the proceeds mentioned therein are less than the amount of the debt that was outstanding immediately before the disposal, the loan which the company is to be regarded as making to the participator shall be of an amount equal to the proceeds less so much thereof as was applied towards the satisfaction of the debt.

Without prejudice to the proviso to subsection (3) of section 303 of the Taxes Act, paragraph (c) of that subsection shall not apply so as to make an individual an associate of a participator as being entitled to benefit under a trust established for the purpose of an approved share incentive scheme.

In this section " approved share incentive scheme " means a share incentive scheme approved under Schedule 12 to the Finance Act 1972 and expressions used in that Schedule have the same meanings as they have there.

Schedule 16 to the Finance Act 1972 (apportionment of income, etc. of close companies for accounting periods ending after 5th April 1973) shall have effect and, except in so far as any provision of Part I of Schedule 9 to this Act otherwise provides, shall be deemed always to have had effect subject to the amendments in that Part of that Schedule, and the transitional provisions in Part II of that Schedule shall have effect with respect to accounting periods of close companies beginning before 6th April 1973.

Schedule 17 to the Finance Act 1972 (amendments relating to close companies) shall have effect and be deemed always to have had effect as if at the end of paragraph 8 (commencement) there were added the words " but does not affect the operation of any enactment in relation to any previous time ".

Paragraph 19(1) of Schedule 23 to the Finance Act 1972 (for the purposes of making shortfall assessments for 1973-74 under section 289(1) of the Taxes Act, it is to be assumed that section 232(2) of that Act, which charges certain distributions to income tax, is in force) shall have effect and be deemed always to have had effect as if after the words " of that Act" there were inserted the words " as amended by paragraph 27 (b) of Schedule 6 to the Finance Act 1971 " (substitution of " basic rate " for " standard rate ").

The repeal by the Finance Act 1972 of the reference in section 98 of the Taxes Management Act 1970 to section 301 of the Taxes Act shall not be taken to have effect in relation to accounting periods in relation to which the repeal of section 301 does not have effect, that is to say accounting periods ending before 6th April 1973.

Where a person entitled to a tax credit in respect of a distribution to which this section applies is, by reason of any exemption from tax, entitled to recover tax and his holding (together with any associated holding) of any one class of the shares, securities or rights by virtue of which he is entitled to the distribution amounts to not less than 10 per cent, thereof, subsection (3) below shall apply to the income represented by any part of the distribution which is not a part—

For the purposes of this section and of Schedule 10 to this Act the date of acquisition, in relation to any part of a distribution or profits attributable to it, is the date on which the shares, securities or rights by virtue of which a person is entitled to that part were acquired by him.

Where this subsection applies to any income.—

Where, by virtue of this section, an exemption from tax does not apply to any income represented by a distribution or part of a distribution, the person entitled to the income shall be liable to tax or, as the case may be, additional tax, on it at a rate equal to the additional rate in force at the time the distribution is made and shall be assessable to income tax or corporation tax accordingly.

This section applies to any qualifying distribution made after 5th April 1973 but does not apply to an amount which— is treated as a qualifying distribution.

Schedule 10 to this Act shall have effect for supplementing this section.

This section has effect where, on or after 6th April 1973, any person (in this section referred to as "the recipient") receives an amount treated as a distribution by virtue of— and in the following provisions of this section a distribution falling within any of paragraphs (a) to (c) above is referred to as a " bonus issue " and " relevant tax credit ", in relation to a bonus issue, means the tax credit to which the recipient of the bonus issue becomes entitled under section 86 of the Finance Act 1972 in respect of the bonus issue.

Subject to subsection (6) below, if the recipient is entitled by reason of— to recover tax in respect of any distribution received by him, no account shall be taken for the purposes of any such exemption or set-off of any bonus issue or relevant tax credit received by him.

Subject to subsection (6) below, where, by virtue of this section, no account is to be taken for the purposes of any exemption from tax of any bonus issue and the relevant tax credit, the person entitled to that issue and that credit shall be liable to tax or, as the case may be, additional tax, on them at a rate equal to the additional rate in force at the time the bonus issue is made and shall be assessable to income tax or corporation tax accordingly.

Subject to subsection (6) below, a bonus issue and the relevant tax credit shall be treated for the purposes of sections 89 and 90 of the Finance Act 1972 and Schedule 23 to that Act as not being franked investment income.

Subject to subsection (6) below—

Nothing in subsections (2) to (5) above shall affect the proportion (if any) of any bonus issue made in respect of any shares or securities which, if it were declared as a dividend, would represent a normal return to the recipient on the consideration provided by him for the relevant shares or securities, that is to say, those in respect of which the bonus issue was made and, if those securities are derived from shares or securities previously acquired by the recipient, the shares or securities which were previously acquired ; nor shall anything in those subsections affect the like proportion of the relevant tax credit relating to that bonus issue.

For the purposes of subsection (6) above.—

Chapters I and II of Part XVII of the Taxes Act (tax avoidance: transactions in securities) shall be amended in accordance with Schedule 11 to this Act.

Except in so far as any provision of that Schedule otherwise provides, Schedule 11 to this Act shall have effect with respect to distributions made after 5th April 1973.

Where a person, after 6th March 1973, acquires the right to receive the amount (with or without interest) stated in a certificate of deposit issued to him or any other person, any profits or gains arising to him from the disposal of that right or, except so far as it is a right to receive interest, from its exercise shall, if not falling to be taken into account as a trading receipt, be treated as annual profits or gains chargeable to tax under Case VI of Schedule D.

Where a person sustains a loss in a transaction which, if a profit had arisen from it, would be chargeable to tax by virtue of subsection (1) above, then, if he is chargeable to tax under Schedule C or D in respect of the interest payable on the amount stated in the certificate concerned, the amount of that interest shall be included in the amounts against which he may claim to set off the amount of his loss under section 176 or, as the case may be, section 179 of the Taxes Act (Case VI losses).

For the purposes of this section profits or gains shall not be treated as falling to be taken into account as a trading receipt by reason only that they are included in the computation required by section 305(2) of the Taxes Act (insurance companies).

In this section " certificate of deposit" has the same meaning as in section 55 of the Finance Act 1968.

Where a security to which this section applies is issued at a discount tax shall not be charged in respect of the discount under Case III of Schedule D; but the discount shall not for that reason be regarded as annual profits or gains chargeable to tax under Case VI of Schedule D.

This section applies to all securities issued by the Treasury after 6th March 1973, except Treasury bills.

The provisions of this section shall have effect on and after 6th March 1973 for the purposes of section 258 and the following sections of Chapter I of Part XI of the Taxes Act (group relief).

Notwithstanding that at any time a company (in this subsection referred to as " the subsidiary company ") is a 75 per cent, subsidiary or a 90 per cent, subsidiary, within the meaning of section 532 of the Taxes Act, of another company (in this subsection referred to as " the parent company ") it shall not be treated at that time as such a subsidiary for the purposes of the enactments relating to group relief unless, additionally, at that time—

Subject to subsection (4) below, for the purposes of the enactments relating to group relief, a member's share in a consortium, in relation to an accounting period of the surrendering company, shall be whichever is the lowest in that period of the following percentages, namely— and if any of those percentages have fluctuated in that accounting period, the average percentage over the period shall be taken for the purposes of this subsection.

In any case where the surrendering company is a subsidiary of a holding company which is owned by a consortium, for references in subsection (3) above to the surrendering company there shall be substituted references to the holding company.

Part I of Schedule 12 to this Act shall have effect for supplementing this section, and the transitional provisions in Part II of that Schedule shall have effect in relation to this section and section 29 below.

In consequence of the provisions of this section and of Part I of Schedule 12 to this Act, section 258 of the Taxes Act shall have effect subject to the following modifications:—

In this section, section 29 below and Schedule 12 to this Act—

If, apart from this section, two companies (in this subsection referred to as " the first company " and " the second company ") would be treated as members of the same group of companies and— then, for the purposes of the enactments relating to group relief, the first company shall be treated on and after 6th March 1973 as not being a member of the same group of companies as the second company.

If a trading company is owned by a consortium or is a 90 per cent, subsidiary of a holding company which is owned by a consortium and— then, for the purposes of the enactments relating to group relief, the trading company shall be treated on and after 6th March 1973 as though it did not (as the surrendering company) fall within any of paragraphs (a) to (c) of subsection (2) of section 258 of the Taxes Act (the cases where group relief is allowed to members of a consortium).

In any case where a trading company is a 90 per cent, subsidiary of a holding company which is owned by a consortium, any reference in subsection (2) above to the trading company, other than a reference in paragraph (b)(iv) thereof, shall be construed as including a reference to the holding company.

In this section " third company " means a company which, apart from any provision made by or under any such arrangements as are specified in paragraph (b) of either subsection (1) or subsection (2) above, is not a member of the same group of companies as the first company, within the meaning of subsection (1) above, or, as the case may be, the trading company or holding company to which subsection (2) above applies.

In subsections (1) and (2) above—

For the purposes of subsections (1) and (2) above a company is a successor of another if it carries on a trade which, in whole or in part, the other company has ceased to carry on and the circumstances are such that—

Subject to the provisions of this section, if— then, in the accounting period specified in paragraph (c) above and in any subsequent accounting period, the first company shall not be entitled to claim relief as mentioned in paragraph (b) above except in computing its profits (if any) arising under the leasing contract.

For the purposes of this section a company is a successor of the first company if the circumstances are such that—

For the purposes of this section losses incurred on a leasing contract and profits arising under such a contract shall be computed as if the performance of the leasing contract were a trade begun to be carried on by the first company, separately from any other trade which it may carry on, at the commencement of the letting under the leasing contract.

In determining whether the first company would be entitled to claim relief as mentioned in subsection (1)(b) above, any losses incurred on the leasing contract shall be treated as incurred in a trade carried on by that company separately from any other trade which it may carry on.

The provisions of subsection (2) below shall apply in relation to a company (in this section referred to as " the partner company ") which is a member of a partnership carrying on a trade if arrangements are in existence (whether as part of the terms of the partnership or otherwise) whereby—

In any case where the provisions of this subsection apply in relation to the partner company—

In subsection (2) above " relevant accounting period of the partnership " means any accounting period of the partnership ending on or after 6th March 1973 in which any such arrangements as are specified in subsection (1) above are in existence or to which any such arrangements apply; but, in relation to any such accounting period which begins before that date, any reference in subsection (2) above to the company's share in the profits or loss of the accounting period or in any such charges on income as are referred to in subsection (2)(a) above shall be construed as a reference to such proportion only of that share as the part of that period beginning on 6th March 1973 bears to the whole of that period.

If a company is a member of a partnership and tax in respect of any profits of the partnership is chargeable under Case VI of Schedule D, this section shall apply in relation to the company's share in the profits or loss of the partnership as if—

For the purposes of this section, subsection (2) of section 155 of the Taxes Act (special rules for partnerships involving companies) shall have effect for determining a company's share in the profits or loss of any accounting period of a partnership as if, in the proviso to subsection (1) of that section, in paragraph (b), the words " or for capital allowances and charges " were omitted.

Subject to subsection (7) below, to the extent that the partner company's share in the loss of any accounting period of the partnership is attributable— the partner company's share shall be available, notwithstanding anything in subsection (2) above, for surrender by way of group relief or for set-off under section 177(2) of the Taxes Act against the company's profits of the corresponding accounting period or periods, as defined in section 155(2) of that Act.

Subsection (6) above shall not apply unless—

For the purposes of subsection (6) above, the partner company's share in the loss of any accounting period of the partnership shall be treated as attributable to an allowance falling within any of paragraphs (a) to (d) of that subsection to the extent that it would not have been available for surrender by way of group relief or for set-off as mentioned in that subsection if no such allowance had been available to the partnership in respect of the expenditure concerned.

In this section " group relief " has the same meaning as in section 258 of the Taxes Act and any question whether one person is connected with another shall be determined in accordance with section 533 of that Act.

In this section " relevant arrangements ", in relation to a claim (including a return which is treated as a claim) falling within any of paragraphs (a) to (d) of subsection (1) above, means such arrangements as are referred to in that enactment which is specified in the corresponding paragraph below, that is to say.—

In a case falling within paragraph (a) of subsection (1) above, a notice under that subsection may be served on the surrendering company, within the meaning of section 258 of the Taxes Act, instead of or as well as on the company claiming relief.

In a case falling within paragraph (c) of subsection (1) above, a notice under that subsection may be served on the partners instead of or as well as on the company alone, and accordingly may require them, instead of or as well as the company, to furnish the declaration, information or declaration and information concerned.

In section 98 of the Taxes Management Act 1970 (penalty for failure to furnish information) there shall be added in the first column of the Table the words " Section 32 of the Finance Act 1973 ".

In this section, sections 29 to 31 above, paragraph 5(3) of Schedule 12 to this Act, and section 92(9) of the Finance Act 1972 " arrangements " means arrangements of any kind, whether in writing or not.

An election for the herd basis made under paragraph 2 of Schedule 6 to the Taxes Act after the passing of this Act and before 6th April 1976 shall be valid notwithstanding that it is not made within the time required by paragraph 2(3) or 6(2) of that Schedule.

An election which is valid by virtue only of this section shall have effect only for the chargeable period in which it is made and subsequent chargeable periods.

If the British Overseas Airways Corporation or the British European Airways Corporation ceases to carry on a trade and, on the Corporation ceasing to carry on that trade, the British Airways Board begins to carry it on, section 252 of the Taxes Act (company reconstructions without change of ownership) shall apply in relation to the Corporation and the Board (as " the predecessor " and " the successor " for the purposes of that section) with the omission of paragraph (a) of subsection (1) (provisions applicable to common ownership of a trade).

In section 59(1) of the Civil Aviation Act 1971 (application of group income and group relief provisions to the Corporations and the British Airways Board) after the words " shall be treated ", in the second place where they occur, there shall be inserted the words " notwithstanding anything in section 28 of the Finance Act 1973 ".

The territorial sea of the United Kingdom shall for all purposes of income tax, capital gains tax and corporation tax (including the following provisions of this section) be deemed to be part of the United Kingdom.

In this section and in Schedule 15 to this Act—

Any profits or gains from exploration or exploitation activities carried on in a designated area or from exploration or exploitation rights shall be treated for the purposes of income tax or corporation tax as profits or gains from activities or property in the United Kingdom ; and any gains accruing on the disposal of such rights shall be treated for the purposes of Part III of the Finance Act 1965 as gains accruing on the disposal of assets situated in the United Kingdom.

Any profits or gains arising to any person not resident in the United Kingdom from exploration or exploitation activities carried on in the United Kingdom or in a designated area or from exploration or exploitation rights, and any gains accruing to such a person on the disposal of such rights shall, for the purposes of corporation tax or capital gains tax, be treated as profits or gains of a trade, or gains accruing on the disposal of assets used for the purposes of a trade, carried on by that person in the United Kingdom through a branch or agency.

In relation to exploration or exploitation rights disposed of by a company resident in a territory outside the United Kingdom to a company resident in the same territory or in the United Kingdom, sections 273 to 275 and 278 to 279 of the Taxes Act (transfer within group and company ceasing to be member of group) shall apply as if in section 272 of that Act (definition of " group " etc.) subsections (1)(a) and (2) were omitted.

Any emoluments from an office or employment in respect of duties performed in a designated area in connection with exploration or exploitation activities shall be treated for the purposes of income tax as emoluments in respect of duties performed in the United Kingdom.

This section shall have effect for the purposes of income tax and capital gains tax for the year 1973-74 and subsequent years of assessment and for the purposes of corporation tax for the financial year 1973 and subsequent years.

Schedule 15 to this Act shall have effect for supplementing this section.

Section 516(2) of the Taxes Act shall have effect with respect to any accounting period ending after the commencement of this Act as if the following were inserted at the end of paragraph (b):and.

Where an overseas life insurance company receives a qualifying distribution made after 5th April 1973 by a company resident in the United Kingdom and relief in respect of the distribution is not available or is not claimed under arrangements specified in an Order in Council made under section 497 of the Taxes Act, the overseas life insurance company shall be deemed for the purposes of sections 312, 314, 316, 318 and 319 of the Taxes Act and Schedule 18 to the Finance Act 1972 to be entitled to such a tax credit in respect of the distribution as it would be entitled to under section 86 of the Finance Act 1972 if it were resident in the United Kingdom; and accordingly the distribution shall be treated for the purposes of those provisions as representing income equal to the aggregate of the amount or value of the distribution and the amount of that credit.

Where under subsection (2) above an overseas life insurance company is deemed to be entitled to a tax credit in respect of a distribution, it may claim to have the income represented by the distribution set, subject to subsection (4) below, against its profits chargeable to tax under section 312 or against its income chargeable to tax in accordance with section 316 of the Taxes Act or partly against the one and partly against the other; but to the extent that any income is so set the tax credit included in it shall not be payable and shall not be set against corporation tax under paragraph 6 of Schedule 18 to the Finance Act 1972.

The amounts that an overseas life insurance company may by virtue of this section set against profits or income of any description shall not exceed the amount of the profits or income of that description and shall be further limited as follows:—

Where by virtue of a set-off under this section income or profits of any description are reduced by any amount, that amount shall be left out of account in determining the amount of income tax which is available for set-off against corporation tax under section 246(3) of the Taxes Act.

A claim under this section in respect of a distribution shall not prevent the making of a subsequent claim for relief in respect of that distribution under arrangements specified in an Order in Council made under section 497 of the Taxes Act; but where such a subsequent claim is made the claim under this section shall be deemed never to have been made, and no adjustment (whether by additional assessments or otherwise) to which the subsequent claim gives rise shall be out of time if it is made within twelve months after the making of the subsequent claim.

Section 323 of the Taxes Act (interpretation) shall apply for the purposes of this section.

The Agreement set out in Schedule 17 to this Act, that is to say, the Agreement made on 2nd May 1973 between the Governments of the United Kingdom and of the Republic of Ireland relating to the first of the Agreements set out in Schedule 12 to the Taxes Act as amended by the second of those Agreements, is hereby confirmed, and, subject to the necessary steps being taken to give it the force of law in the Republic of Ireland, shall have effect accordingly.

Where, under Article 2 of the Agreement of 2nd May 1973, the exemption from Republic of Ireland income tax to which a company resident in the United Kingdom is entitled in respect of a dividend (as defined in that Article) is limited, the tax to which it is liable by virtue of that Article shall, on a claim made for the purpose to the Board, be allowed (subject to subsection (3) below) as a credit against the corporation tax attributable to that dividend.

The aggregate of the amounts of credit allowed— in respect of any dividend to which a company is entitled shall not exceed the amount of corporation tax attributable to that dividend.

Where a company, under subsection (2) above, claims a credit for Republic of Ireland income tax then, notwithstanding section 516 of the Taxes Act, no deduction shall be made for that tax in computing the company's income for the purposes of corporation tax.

Subsections (4) to (6) of section 100 of the Finance Act 1972 shall apply, with the necessary modifications, for determining for the purposes of this section the corporation tax attributable to any dividend.

The provisions of this section shall have effect for determining the principal value, for the purposes of estate duty, of any qualifying investments which—

Subject to the following provisions of this section, in determining the estate duty chargeable on the death in question, the principal value of the investments to which the claim relates shall be treated as reduced by an amount equal to the loss on sale.

Subject to subsection (5) below, if a claim is made under this section and, at any time during the period beginning on the date of the death in question and ending two months after the date of the last sale falling within subsection (1)(c) above of any qualifying investments to which the claim relates, the person making the claim purchases any qualifying investments in the same capacity as that in which he makes the claim, the loss on sale of the investments to which the claim relates shall be treated for the purposes of subsection (3) above as reduced by the proportion which the aggregate of the purchase prices of all the qualifying investments so purchased bears to the aggregate of the values referred to in subsection (2)(b) above (or, if the aggregate of those purchase prices equals or exceeds the aggregate of those values, the loss on sale shall be extinguished).

If a claim is made under this section by any person in a capacity other than that of an executor or trustee—

In this section— and any reference to the investments to which a claim relates is a reference to all the qualifying investments which, on the making of the claim, are taken into account under subsection (2) above in determining the loss on sale.

Schedule 18 to this Act shall have effect for supplementing this section and any expression to which a meaning is assigned by subsection (2) or subsection (6) above has the same meaning in that Schedule as in this section.

For the purposes of subsection (5) above and Schedule 18 to this Act, two investments, not being investments in an authorised unit trust, shall not be treated as of the same description if they are separately quoted on a recognised stock exchange, and an investment in one authorised unit trust shall not be treated as of the same description as an investment in another authorised unit trust.

If at the time, or as a result, of the occurrence after 31st July 1973 of any of the transactions relating to a capital company which are specified in Part I of Schedule 19 to this Act (in this section referred to as " chargeable transactions ")— then, subject to subsection (2) below, there shall be delivered to the Commissioners, within one month of the transaction, a statement in such form and containing such particulars with respect to the transaction as the Commissioners may prescribe.

The obligation to deliver a statement to the Commissioners under subsection (1) above shall not apply in relation to a chargeable transaction falling within sub-paragraph (a) or sub-paragraph (b) of paragraph 1 of Schedule 19 to this Act if the transaction consists of or includes—

In any case where, by virtue of subsection (2)(a) above, there is no obligation to deliver to the Commissioners a statement under subsection (1) above with respect to a chargeable transaction, a statement with respect thereto shall be delivered to the registrar of companies, in addition to the memorandum and articles to be delivered under section 12 of the Companies Act 1948, and—

If, by virtue of subsection (2) above, there is no obligation to deliver to the Commissioners a statement under subsection (1) above with respect to a chargeable transaction, then— shall contain the like particulars with respect to the transaction as would be required to be contained in a statement under subsection (1) above if the obligation under that subsection did apply.

Subject to subsection (6) below, where a chargeable transaction occurs, the relevant document shall be charged with ad valorem stamp duty of £1 for every £100 or part of £100 of the amount determined in relation to that document under Part II of Schedule 19 to this Act.

If the relevant document relates to a chargeable transaction which, by virtue of Part III of Schedule 19 to this Act, is an exempt transaction for the purposes of this section then, except as provided in that Part, stamp duty shall not be chargeable on the document under subsection (5) above, but the document shall not be treated as duly stamped unless it is stamped, in accordance with section 12 of the Stamp Act 1891, with a particular stamp denoting either that it is not chargeable with any duty or that it is duly stamped.

If a chargeable transaction occurs and the stamp duty (if any) chargeable in accordance with this section on the relevant document is not paid within one month from the date of the transaction.—

The supplementary provisions in Part IV of Schedule 19 to this Act shall have effect in relation to chargeable transactions and, in consequence of the provisions of this section, the amendments in Part V of that Schedule shall have effect.

In this section and in Schedule 19 to this Act—

For the purposes of section 47 above and Schedule 19 to this Act, the expression " capital company " means—

For the avoidance of doubt, it is hereby declared that a unit trust (whether an authorised unit trust or not) is not, by virtue of paragraph (d) of subsection (1) above, a capital company for the purposes specified in that subsection.

On and after 1st August 1973 no stamp duty shall be chargeable on any statement under— unless the obligation to deliver the statement arose before that date, or the period within which it is required to be delivered or sent began on or before that date.

No stamp duty shall be chargeable under section 8 of the Finance Act 1899 on any statement of an amount proposed to be secured by an issue of loan capital unless the obligation to deliver the statement arose before 1st January 1973; and in any case where duty has been paid under that section in respect of any statement on which, by virtue of this subsection, duty was not chargeable, the corporation, company or body of persons by whom the duty was paid shall be entitled, on making a claim in that behalf, to repayment of that duty.

No stamp duty shall be chargeable by virtue of the heading "Marketable Security" in Schedule 1 to the Stamp Act 1891 on any instrument executed or made on or after 1st January 1973, but— and in any case where duty has been paid by virtue of the said heading " Marketable Security " in respect of an instrument on which, by virtue of this subsection, duty was not chargeable, the person by whom the duty was paid shall be entitled, on making a claim in that behalf, to repayment of that duty.

In any case where— there shall be determined the amount of duty, in this section referred to as " the notional new duty ", which would have been payable by the company, corporation or partners in respect of transactions occurring in the period of seven months ending immediately before 1st August 1973 if sections 47 and 48 above and Schedule 19 to this Act had been in force on and after 1st January 1973 (with the substitution of a reference to 31st December 1972 for any reference in those provisions to 31st July 1973); and if the amount of duty paid as mentioned in paragraph (a) above exceeds the amount of the notional new duty, the company, corporation or partners shall be entitled to repayment of an amount equal to that excess.

Subject to subsection (8) below, if on a claim made in such form as the Commissioners may prescribe it is proved to their satisfaction that— the company shall be treated as having paid, on account of any duty for which it may become liable under section 47(5) above, a sum equal to that part of the duty paid as mentioned in paragraph (a) above which was so paid in respect of the excess referred to in paragraph (b) above.

If at any time the nominal share capital of a company was treated as reduced under paragraph (A) of section 55(1) of the Finance Act 1927 (relief from capital duty in cases of reconstruction or amalgamation of companies) then, for the purposes of subsection (5) above, stamp duty shall be treated as having been paid as mentioned in that subsection, at the rate applicable when the acquisition referred to in paragraph (b) of the said section 55(1) occurred, in respect of an amount of nominal share capital equal to the amount of the reduction under the said paragraph (A).

Subject to subsection (8) below, if, on 31st July 1973, the issued share capital of a company includes any shares which are not fully paid up, then, for the purposes of subsection (5) (b) above, the total of its issued share capital shall be treated as reduced by a sum equal to the total amount which remains to be paid up on those shares.

If a claim is made under subsection (4) above by a company, no claim may be made by the company under subsection (5) above except at the same time as the claim under subsection (4) above; and for the purpose of any such contemporaneous claim under subsection (5) above and of determining the amount of any repayment under subsection (4) above, subsections (5) to (7) above shall have effect—

The repeal by this Act of section 8 of the Finance Act 1899 and of any other enactment amending that section shall not affect the construction of any enactment in which " loan capital" has the same meaning as in that section.

Where the House of Commons passes a resolution which— then, subject to subsection (3) of this section, the resolution shall for the period so stated have statutory effect as if contained in an Act of Parliament.

The period to be stated in a resolution is a period expressed as beginning on a date so stated and ending on, or thirty-one days or such less number of days as may be so stated after, the earliest of the dates mentioned in this subsection; and those dates are—

A resolution shall cease to have statutory effect under this section if an Act comes into operation varying or abolishing the duty.

Subsection (2B) applies where Parliament is prorogued at the end of a session if—

The ending of the period for which a resolution has statutory effect under the provisions of this section shall not affect the validity of anything done during that period.

A resolution shall cease to have statutory effect under this section if, during the period of thirty sitting days beginning with the first sitting day of the next session, no Bill containing provisions to the same effect as the resolution is presented to the House.

In subsection (2B) “sitting day” means a day on which the House sits.

Where a Bill is amended as mentioned in subsection (2A)(a), it does not matter for the purposes of subsection (2A)(b) if the House orders as mentioned in subsection (2A)(b) before the amendment to the Bill is made.

The provisions of subsection (3) below shall have effect in any case where, in relation to an asset to which this section applies, there falls to be determined—

The assets to which this section applies are shares and securities which are not quoted on a recognised stock exchange, within the meaning of the Corporation Tax Acts, at the time as at which their principal value for the purposes of estate duty or their market value for the purposes of tax on chargeable gains falls to be determined.

For the purposes of a determination falling within subsection (1) above, it shall be assumed that, in the open market which is postulated for the purposes of that determination, there is available to any prospective purchaser of the asset in question all the information which a prudent prospective purchaser of the asset might reasonably require if he were proposing to purchase it from a willing vendor by private treaty and at arm's length.

The provisions of Schedule 20 to this Act shall have effect with respect to the application of this section.

This section and Schedule 20 to this Act.—

The difference referred to in subsection (1) above is the difference between—

A claim for relief under this section must be made not later than two years after the end of the year of assessment to which it relates and, if it relates to the year 1973-74, not earlier than 1st October 1973.

Where the activities of a charity which has ceased to exist are carried on by another charity, this section shall apply as if that other charity had been entitled to any repayment of tax for the year 1971-72 to which the charity which has ceased to exist was entitled.

Section 214 of the Taxes Act (tax exemption in respect of certain overseas pensions and pension funds) shall have effect subject to the following modifications:—

Any provision of sections 213 to 217 of the Taxes Act (special treatment of certain overseas pensions and pension funds) which refers— shall have effect on and after the commencement of the said Act of 1973 as if it were a reference to the scheme under section 2 of that Act which, as mentioned in paragraph (a) above, is constituted by that enactment or to such other scheme made under that section as is certified by the Secretary of State for the purposes of the Taxes Act to correspond to that enactment; and the reference in section 37(3) of the Finance Act 1958 (estate duty treatment of pensions under the Overseas Service Act 1958) to a pension paid as mentioned in section 215(1) of the Taxes Act shall be construed accordingly.

If and so long as provision is made by double taxation relief arrangements for a pension of a description specified in subsection (4) below to be exempt from tax in the United Kingdom and, by reason of Her Majesty's Government in the United Kingdom having assumed responsibility for the pension, payments in respect of it are made under section 1 of the Overseas Pensions Act 1973, then, to the extent that those payments are made to, or to the widow or widower of, an existing pensioner, the provision made under the arrangements shall apply in relation to the pension, exclusive of any statutory increases thereof, as if it continued to be paid by the government which had responsibility for it before that responsibility was assumed by Her Majesty's Government in the United Kingdom.

The pensions referred to in subsection (3) above are pensions paid by—

If, immediately before 6th April 1973, a person resident in the United Kingdom is entitled to receive a pension as, or as the widow or widower of, an existing pensioner, and— then, if and so long as the pension is received by that person or, where that person is an existing pensioner, by his or her widow or widower, the provisions of the Taxes Act shall apply in relation to it, exclusive of any statutory increases thereof, as if it continued to be paid by the government or other body or fund which had responsibility for it before that responsibility was assumed by Her Majesty's Government in the United Kingdom.

If, by reason of Her Majesty's Government in the United Kingdom having assumed responsibility for a pension, allowance or gratuity, payments in respect of it are made under section 1 of the Overseas Pensions Act 1973, then the enactments relating to estate duty shall apply in relation to the pension, allowance or gratuity, exclusive of any statutory increases thereof, as if it continued to be paid by the government or other body or fund which had responsibility for it before that responsibility was assumed by Her Majesty's Government in the United Kingdom.

At the end of section 273(5) of the Government of India Act 1935 (pensions payable out of certain family pension funds relating to service in India to be exempt from estate duty) there shall be added the words " or to any fund administered under a scheme made under section 2 of the Overseas Pensions Act 1973 which is certified by the Secretary of State, for the purpose of the exemption conferred by this subsection, to correspond to an Order in Council under subsection (1) of this section. "

In section 40(4)(a) of the Finance Act 1956 (certain pensions treated for estate duty purposes as if paid by the Government of India or the Government of Pakistan) for the words " the Pensions (India, Pakistan and Burma) Act 1955 " there shall be substituted the words " a scheme made under section 2 of the Overseas Pensions Act 1973 which is constituted by the Pensions (India, Pakistan and Burma) Act 1955 or is certified by the Secretary of State for the purposes of this section to correspond to the said Act of 1955 " and for the words " is paid " there shall be substituted the words " was first paid under the said Act of 1955 ".

In this section— and in this subsection and subsection (6) above " pension, allowance or gratuity " has the same meaning as in section 1 of the Overseas Pensions Act 1973.

In the enactments relating to . . . , . . . , . . . . . . stamp duty— and those enactments shall have effect subject to the amendments specified in Schedule 21 to this Act.

This section shall be deemed to have come into operation on 25th March 1973 but shall not affect the operation of any enactment in relation to anything done before that day.

For the purpose of the compilation or maintenance by the Business Statistics Office of the Department of Trade and Industry of a central register of businesses, or for the purpose of any statistical survey conducted or to be conducted by that Office, the Commissioners or an authorised officer of the Commissioners may disclose to an authorised officer of that Office particulars of the following descriptions obtained or recorded by them in pursuance of Part I of the Finance Act 1972—

Subject to subsection (3) below, no information obtained by virtue of this section by an officer of the Business Statistics Office may be disclosed except to an officer of a Government department (including a Northern Ireland department) for the purpose for which the information was obtained, or for a like purpose.

Subsection (2) above does not prevent the disclosure—

If any person who has obtained any information by virtue of this section discloses it in contravention of this section he shall be liable on summary conviction to a fine not exceeding £400 or on conviction on indictment to imprisonment for a term not exceeding two years or to a fine or to both.

In this section expressions used in Part I of the Finance Act 1972 have the same meanings as in that Part and references to the Business Statistics Office of the Department of Trade and Industry include references to any Northern Ireland department carrying out similar functions.

Where a Government department, in pursuance of ... any international agreement or arrangement, provides any services or facilities or issues any authorisation, certificate or other document, it may, in connection therewith, require the payment of such fees or other charges as may be prescribed by, or determined under, regulations made by the Minister in charge of the department with the consent of the Treasury.

Regulations under this section may provide for the recovery and disposal of any sums payable under the regulations and make different provision for different circumstances.

The powers conferred by this section are without prejudice to any powers exercisable apart from this section to require the payment of fees or other charges.

Regulations under this section shall be made by statutory instrument, which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

In this section “Government department” includes a department of the Government of Northern Ireland, and any regulations which the Minister in charge of such a department is empowered to make under this section may be made either by him or by the department, and with the consent of the Department of Finance for Northern Ireland instead of the Treasury; and in relation to regulations so made subsection (4) of this section shall not apply but they shall be subject to negative resolution, within the meaning of section 41(6) of the Interpretation Act (Northern Ireland) 1954, as if they were a statutory instrument within the meaning of that Act.

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

If for any accounting period the revenues of a sugar refiner fall short of the total sums which are properly chargeable to revenue account for that period and the Minister of Agriculture, Fisheries and Food so directs, the Sugar Board shall make good the deficiency.

The Minister of Agriculture, Fisheries and Food may with the approval of the Treasury give directions as to the way in which the revenues of a sugar refiner are to be computed for the purposes of this section and as to the sums to be treated for those purposes as properly chargeable to revenue account.

In this section " sugar refiner " means a person other than the British Sugar Corporation Limited who carries on business in the United Kingdom as a refiner of sugar.

The Treasury may by order make such amendments in paragraph 10 of Part II of Schedule 1 to the Trustee Investments Acts 1961 (under which a trustee’s power to invest in certain securities depends on the amount of dividends paid) and in any enactment or instrument modifying that paragraph as appear to them required in consequence of the repeal by the Finance Act 1972 of the provisions relating to the deduction of income tax from distributions made by companies.

An order under this section may be varied or revoked by a subsequent order under this section, and any such order shall be made by statutory instrument, which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

This Act may be cited as the Finance Act 1973.

In this Act—

In this Act—

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

Except as otherwise expressly provided, such of the provisions of this Act as relate to matters in respect of which the Parliament of Northern Ireland has power to make laws do not extend to Northern Ireland.

If the Parliament of Northern Ireland passes provisions amending or replacing any enactment of that Parliament referred to in this Act the reference shall be construed as a reference to the enactment as so amended or, as the case may be, as a reference to those provisions.

The enactments mentioned in Schedule 22 to this Act (which include certain enactments which had ceased to have effect before the commencement of this Act) are hereby repealed to the extent specified in the third column of that Schedule, but subject to any provision at the end of any Part of that Schedule.

For the following provisions of the Finance Act 1964 setting out rates of customs and excise duties and of drawback, namely— there shall be substituted the provisions set out in Schedules 1 to 5 to this Act.

In lieu of the duties of customs and excise charged on matches under section 4 of the Finance Act 1951 there shall be charged on matches imported into the United Kingdom a duty of customs, and on matches sent out from the premises of a manufacturer of matches a duty of excise, at the rates shown in Schedule 6 to this Act.

The duties of customs and excise charged on mechanical lighters by section 6 of the Finance Act 1928 shall, instead of being charged at the rates specified in section 8 of the Finance Act 1949 and section 56(3) of the Finance Act 1972, be charged at the rates shown in Schedule 7 to this Act, but no duty shall be chargeable under section 6 of the Act of 1928 on a gas lighter, that is to say a mechanical lighter which is shown to the satisfaction of the Commissioners to be constructed solely for the purpose of igniting gas for domestic use.

The Treasury may by order made before 1st July 1977 make such provision for altering— as may be required to give effect to any Community obligation or any obligation under the Geneva Protocol of 21st December 1972.

An order under the preceding subsection—

An order under subsection (4) of this section shall be made by statutory instrument and may be varied or revoked by a subsequent order; and any such order— In reckoning any such period no account shall be taken of any time during which Parliament is dissolved or prorogued or during which the House of Commons is adjourned for more than four days.

The substitution by or under this section of a rate of drawback for a rate previously in force shall apply only in relation to goods in respect of which duty at the corresponding rate has been paid.

In Schedules 1 to 7 to this Act-

In section 111(1) and section 122 of the Customs and Excise Act 1952 (which provide for remission of duty on spirits in certain cases by reference to the preferential rate) the following paragraphs shall be substituted for paragraphs (a) and (b)—.

This section shall be deemed to have had effect as from 1st April 1973.

The Secretary of State may by regulations make provision for determining, for the purposes of any duty of customs, the origin of any goods in cases where it does not fall to be determined under a Community regulation or any Act or other instrument having the force of law.

Regulations under this section may—

Subject to the provisions of any regulations under this section, where in connection with a duty of customs chargeable on any goods any question arises as to the origin of the goods, the Commissioners may require the importer of the goods to furnish to them, in such form as they may prescribe, proof of any statement made to them as to any fact necessary to determine that question; and if such proof is not furnished to their satisfaction, the question may be determined without regard to that statement.

Regulations under this section shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of the House of Commons.

Where the Commissioners of Customs and Excise are satisfied that purchase tax or a duty to which this section applies was charged on or in respect of goods or on or in respect of parts or ingredients of goods which at the beginning of April 1973 were unused and held by a taxable person for sale in the course of his business, then if— an amount determined or arrived at in accordance with subsection (2) of this section to take account of the tax or duty charged may, in the manner specified in the Notice, be included in the return made by the taxable person under Part I of the Finance Act 1972 for the first prescribed accounting period or, with the sanction of the Commissioners, in such a return made for a later period and shall, if so included, be treated for the purposes of that Part as an amount to be deducted as input tax. In this subsection " sale " includes any supply under a hire-purchase agreement.

The amount that may be so included shall be as follows— and such method may be used in determining that amount, or, if it cannot be determined, in arriving at an appropriate amount to be substituted for it, as the Commissioners may allow.

Where by virtue of this section an amount is treated as input tax to take account of a duty charged, then, if any drawback or repayment falls to be allowed or made in respect of that duty, its amount shall be calculated as if the duty had been charged at the corresponding rate in force on 1st April 1973.

For the purposes of subsections (2)(d), (2)(e) and (3) above, any country's membership of the European Economic Community shall be disregarded.

In relation to duty charged on a gas lighter, the rates in force on 1st April 1973 shall be taken for the purposes of subsections (2)(d), (2)(e) and (3) above to be—

For the purposes of this section goods shall be deemed to be held by a person at the beginning of April 1973 if, and only if, they were— before the end of March 1973 and had not then been supplied by him; and any question whether goods were supplied by or to or were imported by any person before the end of March 1973 shall be determined as, under sections 7 and 47 of the Finance Act 1972, it falls to be determined for the purposes of the charge to value added tax.

This section applies to any duty of customs or excise charged on—

This section shall be deemed to have had effect from the beginning of April 1973.

Subject to subsection (2) below, income tax for the year 1972-73 shall be charged, in the case of an individual whose total income exceeded £3,000, at the same higher rates in respect of the excess of that income over £2,000 as were charged for the year 1971-72.

An individual whose total income for the year 1972-73 did not exceed £3,500 shall be entitled to have the surtax chargeable by virtue of subsection (1) above reduced to an amount equal to 40 per cent, of the difference between his total income and £3,000.

In section 7 of the Taxes Act (relief for persons over sixty-five with small incomes)—

Section 16 of the Taxes Act (relief in respect of dependent relative) shall have effect subject to the following modifications :—

A lump sum paid to a person on his retirement from an office or employment shall not be chargeable to income tax under Schedule E if—

This section shall be deemed always to have had effect.

So far as income arising to trustees is income to which this section applies it shall, in addition to being chargeable to income tax at the basic rate, be chargeable at the additional rate.

This section applies to income arising to trustees in any year of assessment so far as it—

This section also applies to sums apportioned to the trustees under paragraph 1 of Schedule 16 to the Finance Act 1972 and treated, under paragraph 5(2) of that Schedule as applied by subsection (4) below, as income received by the trustees.

Sub-paragraphs (2) and (4) to (8) of paragraph 5 of Schedule 16 to the Finance Act 1972 shall, with the omission in sub-paragraph (2)(a) of the words following " the apportionment relates ", the substitution of " income " for " total income " and all other necessary modifications, apply to a sum apportioned to trustees as they apply to sums apportioned to an individual; and paragraph 6 of that Schedule shall apply accordingly.

For the purposes of this section amounts paid or credited to trustees in any year of assessment in respect of dividends or interest payable in respect of shares in or deposits with or loans to a building society with which arrangements under section 343 of the Taxes Act are in force for that year shall be treated as income for that year received by the trustees after deduction of income tax from a corresponding gross amount. In this subsection expressions used in section 343 of the Taxes Act have the same meanings as in that section.

In this section " trustees" does not include personal representatives ; but where personal representatives, on or before the completion of the administration of the estate, pay to trustees any sum representing income which, if personal representatives were trustees within the meaning of this section, would be income to which this section applies, that sum shall be deemed to be paid to the trustees as income and to have borne income tax (at the basic rate). This subsection shall be construed as if it were contained in Part XV of the Taxes Act.

In relation to the year 1973-74 and subsequent years of assessment there shall be substituted in section 451 of the Taxes Act—

A notice given to trustees under section 8 of the Taxes Management Act 1970 may require a return of the income arising to them to include particulars of the manner in which the income has been applied, including particulars as to the exercise of any discretion and of the persons in whose favour it has been exercised.

Where, in any year of assessment, trustees make a payment to any person in the exercise of a discretion exercisable by them or any person other than the trustees, then, if the sum paid is for all the purposes of the Income Tax Acts income of the person to whom it is paid (but would not be his income apart from the payment), the following provisions of this section shall apply with respect to the payment in lieu of section 52 or 53 of the Taxes Act.

The payment shall be treated as a net amount corresponding to a gross amount from which tax has been deducted at a rate equal to the sum of the basic rate and the additional rate in force for the year in which the payment is made; and the sum treated as so deducted shall be treated—

The following amounts, so far as not previously allowed, shall be set against the amount assessable (apart from this subsection) on the trustees in pursuance of subsection (2)(b) above: but tax on any income represented by amounts paid or credited as mentioned in section 16(5) of this Act after the end of the year 1973-74 shall be taken into account under paragraph (a) above only on production of a certificate from the building society concerned specifying those amounts and stating that an amount representing income tax on that income calculated at the basic rate has been or will be accounted for.

In section 55 of the Taxes Act (certificates of deduction) after the words " section 52, 53 or 54 above " there shall be inserted the words " or section 17 of the Finance Act 1973 ".

In this section " trustees" does not include personal representatives within the meaning of section 432(4) of the Taxes Act.

Subsection (2) of this section shall apply if a payment made by trustees falls to be treated as a net amount in accordance with section 17(2) of this Act and the income arising under the trust includes income in respect of which the trustees are entitled to credit for overseas tax under Part XVIII of the Taxes Act (in that subsection referred to as " taxed overseas income ").

If the trustees certify— the person to whom the payment was made may claim that the payment, up to the amount so certified, shall be treated for the purposes of the said Part XVIII as income received by him from that source and so received in the year in which the payment was made.

Section 286 of the Taxes Act (loans to participators) shall not apply to a loan which, or so much of a loan as.— unless the shares or interests are acquired from, or under arrangements made with, a participator in the company who acquired them neither under an approved share incentive scheme nor, without consideration, as the holder of shares acquired under such a scheme.

Where by virtue of paragraph (a) or (b) of subsection (1) above the application of section 286 of the Taxes Act is excluded in relation to an amount lent by a close company and used by a person satisfying the conditions mentioned therein to acquire shares or interests in shares, then if, at a time when the whole or part of his debt to the company or the trustees is outstanding, he— the company shall be regarded, for the purposes of that section, as making to him at that time a loan of an amount equal, subject to subsection (3) below, to so much of the debt as remains outstanding.

Where, in a case falling within paragraph (b) of subsection (2) above, the proceeds mentioned therein are less than the amount of the debt that was outstanding immediately before the disposal, the loan which the company is to be regarded as making to the participator shall be of an amount equal to the proceeds less so much thereof as was applied towards the satisfaction of the debt.

Without prejudice to the proviso to subsection (3) of section 303 of the Taxes Act, paragraph (c) of that subsection shall not apply so as to make an individual an associate of a participator as being entitled to benefit under a trust established for the purpose of an approved share incentive scheme.

In this section " approved share incentive scheme " means a share incentive scheme approved under Schedule 12 to the Finance Act 1972 and expressions used in that Schedule have the same meanings as they have there.

Schedule 16 to the Finance Act 1972 (apportionment of income, etc. of close companies for accounting periods ending after 5th April 1973) shall have effect and, except in so far as any provision of Part I of Schedule 9 to this Act otherwise provides, shall be deemed always to have had effect subject to the amendments in that Part of that Schedule, and the transitional provisions in Part II of that Schedule shall have effect with respect to accounting periods of close companies beginning before 6th April 1973.

Schedule 17 to the Finance Act 1972 (amendments relating to close companies) shall have effect and be deemed always to have had effect as if at the end of paragraph 8 (commencement) there were added the words " but does not affect the operation of any enactment in relation to any previous time ".

Paragraph 19(1) of Schedule 23 to the Finance Act 1972 (for the purposes of making shortfall assessments for 1973-74 under section 289(1) of the Taxes Act, it is to be assumed that section 232(2) of that Act, which charges certain distributions to income tax, is in force) shall have effect and be deemed always to have had effect as if after the words " of that Act" there were inserted the words " as amended by paragraph 27 (b) of Schedule 6 to the Finance Act 1971 " (substitution of " basic rate " for " standard rate ").

The repeal by the Finance Act 1972 of the reference in section 98 of the Taxes Management Act 1970 to section 301 of the Taxes Act shall not be taken to have effect in relation to accounting periods in relation to which the repeal of section 301 does not have effect, that is to say accounting periods ending before 6th April 1973.

Where a person entitled to a tax credit in respect of a distribution to which this section applies is, by reason of any exemption from tax, entitled to recover tax and his holding (together with any associated holding) of any one class of the shares, securities or rights by virtue of which he is entitled to the distribution amounts to not less than 10 per cent, thereof, subsection (3) below shall apply to the income represented by any part of the distribution which is not a part—

For the purposes of this section and of Schedule 10 to this Act the date of acquisition, in relation to any part of a distribution or profits attributable to it, is the date on which the shares, securities or rights by virtue of which a person is entitled to that part were acquired by him.

Where this subsection applies to any income.—

Where, by virtue of this section, an exemption from tax does not apply to any income represented by a distribution or part of a distribution, the person entitled to the income shall be liable to tax or, as the case may be, additional tax, on it at a rate equal to the additional rate in force at the time the distribution is made and shall be assessable to income tax or corporation tax accordingly.

This section applies to any qualifying distribution made after 5th April 1973 but does not apply to an amount which— is treated as a qualifying distribution.

Schedule 10 to this Act shall have effect for supplementing this section.

This section has effect where, on or after 6th April 1973, any person (in this section referred to as "the recipient") receives an amount treated as a distribution by virtue of— and in the following provisions of this section a distribution falling within any of paragraphs (a) to (c) above is referred to as a " bonus issue " and " relevant tax credit ", in relation to a bonus issue, means the tax credit to which the recipient of the bonus issue becomes entitled under section 86 of the Finance Act 1972 in respect of the bonus issue.

Subject to subsection (6) below, if the recipient is entitled by reason of— to recover tax in respect of any distribution received by him, no account shall be taken for the purposes of any such exemption or set-off of any bonus issue or relevant tax credit received by him.

Subject to subsection (6) below, where, by virtue of this section, no account is to be taken for the purposes of any exemption from tax of any bonus issue and the relevant tax credit, the person entitled to that issue and that credit shall be liable to tax or, as the case may be, additional tax, on them at a rate equal to the additional rate in force at the time the bonus issue is made and shall be assessable to income tax or corporation tax accordingly.

Subject to subsection (6) below, a bonus issue and the relevant tax credit shall be treated for the purposes of sections 89 and 90 of the Finance Act 1972 and Schedule 23 to that Act as not being franked investment income.

Subject to subsection (6) below—

Nothing in subsections (2) to (5) above shall affect the proportion (if any) of any bonus issue made in respect of any shares or securities which, if it were declared as a dividend, would represent a normal return to the recipient on the consideration provided by him for the relevant shares or securities, that is to say, those in respect of which the bonus issue was made and, if those securities are derived from shares or securities previously acquired by the recipient, the shares or securities which were previously acquired ; nor shall anything in those subsections affect the like proportion of the relevant tax credit relating to that bonus issue.

For the purposes of subsection (6) above.—

Chapters I and II of Part XVII of the Taxes Act (tax avoidance: transactions in securities) shall be amended in accordance with Schedule 11 to this Act.

Except in so far as any provision of that Schedule otherwise provides, Schedule 11 to this Act shall have effect with respect to distributions made after 5th April 1973.

Where a person, after 6th March 1973, acquires the right to receive the amount (with or without interest) stated in a certificate of deposit issued to him or any other person, any profits or gains arising to him from the disposal of that right or, except so far as it is a right to receive interest, from its exercise shall, if not falling to be taken into account as a trading receipt, be treated as annual profits or gains chargeable to tax under Case VI of Schedule D.

Where a person sustains a loss in a transaction which, if a profit had arisen from it, would be chargeable to tax by virtue of subsection (1) above, then, if he is chargeable to tax under Schedule C or D in respect of the interest payable on the amount stated in the certificate concerned, the amount of that interest shall be included in the amounts against which he may claim to set off the amount of his loss under section 176 or, as the case may be, section 179 of the Taxes Act (Case VI losses).

For the purposes of this section profits or gains shall not be treated as falling to be taken into account as a trading receipt by reason only that they are included in the computation required by section 305(2) of the Taxes Act (insurance companies).

In this section " certificate of deposit" has the same meaning as in section 55 of the Finance Act 1968.

Where a security to which this section applies is issued at a discount tax shall not be charged in respect of the discount under Case III of Schedule D; but the discount shall not for that reason be regarded as annual profits or gains chargeable to tax under Case VI of Schedule D.

This section applies to all securities issued by the Treasury after 6th March 1973, except Treasury bills.

The provisions of this section shall have effect on and after 6th March 1973 for the purposes of section 258 and the following sections of Chapter I of Part XI of the Taxes Act (group relief).

Notwithstanding that at any time a company (in this subsection referred to as " the subsidiary company ") is a 75 per cent, subsidiary or a 90 per cent, subsidiary, within the meaning of section 532 of the Taxes Act, of another company (in this subsection referred to as " the parent company ") it shall not be treated at that time as such a subsidiary for the purposes of the enactments relating to group relief unless, additionally, at that time—

Subject to subsection (4) below, for the purposes of the enactments relating to group relief, a member's share in a consortium, in relation to an accounting period of the surrendering company, shall be whichever is the lowest in that period of the following percentages, namely— and if any of those percentages have fluctuated in that accounting period, the average percentage over the period shall be taken for the purposes of this subsection.

In any case where the surrendering company is a subsidiary of a holding company which is owned by a consortium, for references in subsection (3) above to the surrendering company there shall be substituted references to the holding company.

Part I of Schedule 12 to this Act shall have effect for supplementing this section, and the transitional provisions in Part II of that Schedule shall have effect in relation to this section and section 29 below.

In consequence of the provisions of this section and of Part I of Schedule 12 to this Act, section 258 of the Taxes Act shall have effect subject to the following modifications:—

In this section, section 29 below and Schedule 12 to this Act—

If, apart from this section, two companies (in this subsection referred to as " the first company " and " the second company ") would be treated as members of the same group of companies and— then, for the purposes of the enactments relating to group relief, the first company shall be treated on and after 6th March 1973 as not being a member of the same group of companies as the second company.

If a trading company is owned by a consortium or is a 90 per cent, subsidiary of a holding company which is owned by a consortium and— then, for the purposes of the enactments relating to group relief, the trading company shall be treated on and after 6th March 1973 as though it did not (as the surrendering company) fall within any of paragraphs (a) to (c) of subsection (2) of section 258 of the Taxes Act (the cases where group relief is allowed to members of a consortium).

In any case where a trading company is a 90 per cent, subsidiary of a holding company which is owned by a consortium, any reference in subsection (2) above to the trading company, other than a reference in paragraph (b)(iv) thereof, shall be construed as including a reference to the holding company.

In this section " third company " means a company which, apart from any provision made by or under any such arrangements as are specified in paragraph (b) of either subsection (1) or subsection (2) above, is not a member of the same group of companies as the first company, within the meaning of subsection (1) above, or, as the case may be, the trading company or holding company to which subsection (2) above applies.

In subsections (1) and (2) above—

For the purposes of subsections (1) and (2) above a company is a successor of another if it carries on a trade which, in whole or in part, the other company has ceased to carry on and the circumstances are such that—

Subject to the provisions of this section, if— then, in the accounting period specified in paragraph (c) above and in any subsequent accounting period, the first company shall not be entitled to claim relief as mentioned in paragraph (b) above except in computing its profits (if any) arising under the leasing contract.

For the purposes of this section a company is a successor of the first company if the circumstances are such that—

For the purposes of this section losses incurred on a leasing contract and profits arising under such a contract shall be computed as if the performance of the leasing contract were a trade begun to be carried on by the first company, separately from any other trade which it may carry on, at the commencement of the letting under the leasing contract.

In determining whether the first company would be entitled to claim relief as mentioned in subsection (1)(b) above, any losses incurred on the leasing contract shall be treated as incurred in a trade carried on by that company separately from any other trade which it may carry on.

The provisions of subsection (2) below shall apply in relation to a company (in this section referred to as " the partner company ") which is a member of a partnership carrying on a trade if arrangements are in existence (whether as part of the terms of the partnership or otherwise) whereby—

In any case where the provisions of this subsection apply in relation to the partner company—

In subsection (2) above " relevant accounting period of the partnership " means any accounting period of the partnership ending on or after 6th March 1973 in which any such arrangements as are specified in subsection (1) above are in existence or to which any such arrangements apply; but, in relation to any such accounting period which begins before that date, any reference in subsection (2) above to the company's share in the profits or loss of the accounting period or in any such charges on income as are referred to in subsection (2)(a) above shall be construed as a reference to such proportion only of that share as the part of that period beginning on 6th March 1973 bears to the whole of that period.

If a company is a member of a partnership and tax in respect of any profits of the partnership is chargeable under Case VI of Schedule D, this section shall apply in relation to the company's share in the profits or loss of the partnership as if—

For the purposes of this section, subsection (2) of section 155 of the Taxes Act (special rules for partnerships involving companies) shall have effect for determining a company's share in the profits or loss of any accounting period of a partnership as if, in the proviso to subsection (1) of that section, in paragraph (b), the words " or for capital allowances and charges " were omitted.

Subject to subsection (7) below, to the extent that the partner company's share in the loss of any accounting period of the partnership is attributable— the partner company's share shall be available, notwithstanding anything in subsection (2) above, for surrender by way of group relief or for set-off under section 177(2) of the Taxes Act against the company's profits of the corresponding accounting period or periods, as defined in section 155(2) of that Act.

Subsection (6) above shall not apply unless—

For the purposes of subsection (6) above, the partner company's share in the loss of any accounting period of the partnership shall be treated as attributable to an allowance falling within any of paragraphs (a) to (d) of that subsection to the extent that it would not have been available for surrender by way of group relief or for set-off as mentioned in that subsection if no such allowance had been available to the partnership in respect of the expenditure concerned.

In this section " group relief " has the same meaning as in section 258 of the Taxes Act and any question whether one person is connected with another shall be determined in accordance with section 533 of that Act.