Finance Act 2003

An amount not exceeding £2,000 due and payable by way of tax is in England and Wales or Northern Ireland recoverable summarily as a civil debt in proceedings brought in the name of the collector. All or any of the sums recoverable under this paragraph that are— may be included in the same complaint, summons or other document required to be laid before or issued by justices. Each such document shall, as respects each such sum, be construed as a separate document and its invalidity as respects any one such sum does not affect its validity as respects any other such sum. Proceedings under this paragraph in England and Wales may be brought at any time within one year from the time when the matter complained of arose. In sub-paragraph (1) the expression “recoverable summarily as a civil debt” in relation to proceedings in Northern Ireland means recoverable by proceedings under Article 62 of the Magistrates' Courts (Northern Ireland) Order 1981 (S.I. 1981/1675 (N.I. 26)). The Treasury may by order increase the sum specified in sub-paragraph (1).

A certificate of an officer of the Board— is sufficient evidence that the sum mentioned in the certificate is unpaid and is due to the Crown. A document purporting to be such a certificate shall be deemed to be such a certificate unless the contrary is proved.

Where a person who has stood in relation to others as a tax accountant— an authorised officer of the Board may by notice in writing require that person to deliver to him such documents as are in his possession or power and (in the officer’s reasonable opinion) contain information relevant to any tax liability to which any client of his is or has been, or may be or have been, subject, or to the amount of any such liability. An “authorised officer of the Board” means an officer of the Board authorised for the purposes of this Part of this Schedule. Before a person is given a notice under this paragraph he must be given a reasonable opportunity to deliver the documents in question. No application for consent under paragraph 16 shall be made unless he has been given that opportunity.

A notice under paragraph 14 must— The period specified for complying with the notice must not be less than 30 days after the date of the notice.

Parts 1 to 3 of this Schedule do not apply— In sub-paragraph (1)—

To comply with a notice under Part 1 or 3 of this Schedule, and as an alternative to delivering documents to comply with a notice under Part 2 of this Schedule, copies of documents may be delivered instead of originals. The copies must be photographic or otherwise by way of facsimile. If so required by the officer (or, as the case may be, the Board) in the case of any documents specified in the requirement, the originals must be made available for inspection by a named officer of the Board. Failure to comply with such a requirement counts as failure to comply with the notice.

A notice under Part 2 of this Schedule— “Relevant communications” means communications between the tax adviser and— the purpose of which is the giving or obtaining of advice about any of those tax affairs. In this paragraph “tax adviser” means a person appointed to give advice about the tax affairs of another person (whether appointed directly by that other person or by another tax adviser of his). This paragraph has effect subject to paragraph 27 (documents belonging to auditor or tax adviser: information to be disclosed).

A notice under paragraph 28 must—

A person who has been given notice of intention to apply for an order under paragraph 32 must not— This is subject to the following qualifications. Sub-paragraph (1)(a) does not prevent anything being done— Sub-paragraph (1)(b) does not prevent a professional legal adviser from disclosing any information or other matter— This sub-paragraph does not apply in relation to any information or other matter that is disclosed with a view to furthering a criminal purpose. A person who fails to comply with the obligation in sub-paragraph (1)(a) or (b) may be dealt with as if he had failed to comply with an order under paragraph 32.

The Inland Revenue may make provision by regulations as to how a person is to comply with an order under paragraph 32. The regulations may, in particular, make provision as to— Where an order relates to a document in electronic or magnetic form, the order shall be taken to require the person to deliver the information recorded in the document in a form in which it is visible and legible.

A person who fails to comply with an order under this Part of this Schedule may be dealt with as if he had committed a contempt of the court. For this purpose “the court” means—

The Board shall not approve an application for a warrant under this Part of this Schedule unless they have reasonable grounds for believing that use of the procedure under Part 6 of this Schedule (order for delivery of documents) might seriously prejudice the investigation. Section 4A of the Inland Revenue Regulation Act 1890 (c. 21) (Board’s functions exercisable by an officer acting under their authority) does not apply to the giving of Board approval under this paragraph.

Nothing in this Part of this Schedule authorises the seizure of items subject to legal privilege. Items “subject to legal privilege” means— Items held with the intention of furthering a criminal purpose are not subject to legal privilege.

If a request for permission to be granted access to anything that— 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 any such person, the officer shall allow the person who made the request access to it under the supervision of an officer of the Board. 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 has custody or control of the thing immediately before it was so removed, or by someone acting on behalf of any such person, the officer shall— Where anything is photographed or copied under sub-paragraph (2)(b) the photograph or copy shall be supplied to the person who made the request. The photograph or copy shall be supplied within a reasonable time from the making of the request. There is no duty under this paragraph 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— The references in this paragraph to the officer in overall charge of the investigation is to the person whose name and address are endorsed on the warrant concerned as being the officer so in charge.

Where part of the property referred to in section 58(1) of the Stamp Act 1891 (c. 39) (consideration to be apportioned between different instruments as parties think fit) consists of stock or marketable securities, that provision shall have effect as if “the parties think fit” read “is just and reasonable”. Where— that provision shall have effect as if the words from “for distinct parts of the consideration” to the end of the subsection read “, the consideration shall be apportioned in such manner as is just and reasonable, so that a distinct consideration for each part of the property transferred is set forth in the transfer relating to that part, and the transfer shall be charged with ad valorem duty in respect of that consideration.”. If in a case where sub-paragraph (1) or (2) applies the consideration is apportioned in a manner that is not just and reasonable, the enactments relating to stamp duty shall have effect as if— For the purposes of sub-paragraph (2)—

In section 3(1) (structure of employment income Parts), in the entry relating to Part 7, for “share-related income and exemptions” substitute “income and exemptions relating to securities and securities options acquired in connection with an employment”. Sub-paragraph (1) has effect on and after 16th April 2003.

The provisions of this Part of this Schedule apply in the case of an award of shares. Where the shares acquired are subject to forfeiture, the provisions of this Part have effect subject to the provisions of Part 4 of this Schedule.

The amount of the relief is equal to the difference between— The consideration mentioned in sub-paragraph (1)(b) does not include the performance of any duties of, or in connection with, the employee’s employment with the employing company. A just and reasonable apportionment shall be made for the purposes of this paragraph of any consideration given partly in respect of the shares and partly in respect of other matters. If the award was made partly for the purposes of a business meeting the requirements of paragraph 3 (business must be within the charge to corporation tax) and partly for the purposes of a business in relation to which those requirements are not met, the amount of the relief shall be reduced to such extent as is just and reasonable.

This paragraph applies where— Where those conditions are met— For the purposes of this paragraph— The following are qualifying companies for the purposes of this paragraph—

The amount of the relief is allowed as a deduction in computing for the purposes of corporation tax the profits of the business for the purposes of which the option was granted. If the company carrying on the business is an investment company, the amount of the relief is treated as disbursed as expenses of management for the purposes of section 75 of the Taxes Act 1988. If the company carrying on the business is an insurance company carrying on life assurance business, the amount of the relief is included among the amounts the company may treat as part of its expenses of management for the purposes of section 76 of the Taxes Act 1988. If the option was granted for the purposes of more than one business within the charge to corporation tax, the amount of the deduction must be apportioned between them on a just and reasonable basis.

This paragraph explains what is meant in this Schedule by shares being “subject to forfeiture”. Subject to the following provisions of this paragraph, shares are “subject to forfeiture” for so long as the terms on which the recipient is entitled to them— In sub-paragraph (2)— Shares are not “subject to forfeiture”— In sub-paragraph (4)— References in this section to the terms on which the recipient is entitled to shares include terms imposed by any contract or arrangement or in any other way.

Where the recipient acquires shares that are subject to forfeiture, this paragraph applies in place of paragraph 10 or 17 (timing of relief). The relief is given for the accounting period in which—

Part 2 of Schedule 12 to the Finance Act 2002 (c. 23) (entitlement to relief for R&D expenditure: work sub-contracted to small or medium-sized enterprise) is amended in accordance with the following provisions of this Part of this Schedule.

The second condition is that the expenditure—

In paragraph 41(4) of that Schedule (the requirement not to enter into tax avoidance arrangements: exemption for finance leases)— In paragraph 147 (index of defined expressions)—

In the Taxes Act 1988, after section 444A insert—. Sub-paragraph (1) has effect in relation to insurance business transfer schemes (within the meaning of section 444AA of the Taxes Act 1988) taking place on or after 1st January 2003 unless the accounting period of the transferor which ends with the day of the transfer began before that date.

In section 84(2) and (3) of the Finance Act 1989 (c. 26) (interpretation of sections 85 to 89 and further provisions about insurance companies), for “the sections referred to in subsection (1) above” substitute “sections 85 to 89 below”.

Part 2 of Schedule 25 to the Taxes Act 1988 (controlled foreign companies: exempt activities) is amended as follows.

After paragraph 11 insert—.

In section 7(6)(b) (employment income), for “(share-related income and exemptions)” substitute “(income and exemptions relating to securities and securities options)”. Sub-paragraph (1) has effect on and after 16th April 2003.

In the Taxes Act 1988, after section 444AA (inserted by paragraph 18(1)) insert—. Sub-paragraph (1) has effect in relation to insurance business transfer schemes (within the meaning of section 444AB of the Taxes Act 1988) taking place in a period of account of the transferor beginning on or after 1st January 2003.

In the Finance Act 1989, after section 90 insert—.

In section 19(2) (year in which earnings treated as received), omit the entries relating to Chapters 8 and 9 of Part 3. Sub-paragraph (1) has effect—

In the Taxes Act 1988, after section 444AB (inserted by paragraph 19(1)) insert—. “brought into account” has the meaning given by section 83A of the Finance Act 1989; This paragraph has effect in relation to insurance business transfer schemes taking place on or after 1st January 2003. If 30th September 2003 is later than the end of the period specified in subsection (3)(b) of section 444AD of the Taxes Act 1988 (inserted by sub-paragraph (1)), an election under subsection (2) of that section may be made no later than that date.

In the Taxation of Chargeable Gains Act 1992 (c. 12), after section 214B insert—.

In section 32(2) (receipt of non-money earnings), omit the entries relating to Chapters 8 and 9 of Part 3. Sub-paragraph (1) has effect—

In the Taxation of Chargeable Gains Act 1992 (c. 12), after section 211 insert—. Sub-paragraph (1) has effect in relation to insurance business transfer schemes taking place on or after 1st January 2003.

In section 63(1) (the benefits code), omit the entries relating to Chapters 8 and 9 of Part 3. Sub-paragraph (1) has effect—

In section 431 of the Taxes Act 1988 (interpretative provisions relating to insurance companies), after subsection (2) insert—. Sub-paragraph (1) has effect in relation to insurance business transfer schemes taking place on or after 1st January 2003 unless the accounting period of the transferor which ends with the day of the transfer began before that date.

In section 64 (relationship between earnings and benefits code), omit subsections (5) and (6). Sub-paragraph (1) has effect in accordance with the provision made for the repeal of Chapter 8 of Part 3.

Section 442A of the Taxes Act 1988 (investment return treated as accruing in respect of reinsured risk) is amended as follows. In subsection (1), for “over the period of” substitute “while the risk remains reinsured by the company under”. After subsection (3) insert—. In subsection (4), omit “to the company”. This paragraph has effect in relation to transfers of reinsurance arrangements taking place on or after 1st January 2003.

Omit Chapter 8 of Part 3. Sub-paragraph (1) has effect in relation to shares, and interests in shares, acquired on or after 16th April 2003.

Section 444A of the Taxes Act 1988 (transfers of business: losses etc) is amended as follows. In subsection (3), insert at the end “if the conditions in paragraphs (a) and (b) of section 343(1) are satisfied in relation to the business transferred (construing references to an event as to the transfer).”. After that subsection insert—. This paragraph has effect in relation to insurance business transfer schemes taking place on or after 1st January 2003 unless the accounting period of the transferor which ends with the day of the transfer, or the accounting period of the transferee during which the transfer takes place, began before that date.

Omit Chapter 9 of Part 3. Sub-paragraph (1) has effect in relation to shares, and interests in shares, disposed of on or after 16th April 2003.

Section 216 (provisions not applicable to lower-paid employments) is amended as follows. In subsection (4), omit the entries relating to Chapters 8 and 9 of Part 3. In subsection (6), omit the entries relating to section 195(3) and section 199(4). Sub-paragraphs (1) to (3) have effect—

Section 227(4) (employment income: exemptions) is amended as follows. For paragraphs (a) and (b) substitute—. Omit paragraphs (d), (f) and (h). This paragraph has effect—

Omit section 491 (no charge under Chapter 8 of Part 3 in respect of acquisition of approved share incentive plan shares). Sub-paragraph (1) has effect in accordance with the provision made for the repeal of Chapter 8 of Part 3.

Omit section 494 (no charge on removal of restrictions applying to approved share incentive plan shares). Sub-paragraph (1) has effect—

Omit section 495 (approved share incentive plan shares: value of shares in dependent subsidiary). Sub-paragraph (1) has effect on 16th April 2003.

Omit section 518 (no charge in respect of acquisition of approved SAYE share scheme option). Sub-paragraph (1) has effect on the day appointed under paragraph 3(2).

In section 519 (no charge in respect of exercise of approved SAYE share scheme option), omit subsection (4). Sub-paragraph (1) has effect on the day appointed under paragraph 3(2).

Omit section 520 (approved SAYE option schemes: no charge in respect of post-acquisition benefits). Sub-paragraph (1) has effect in accordance with the provision made for the substitution of Chapter 4 of Part 7.

Omit section 523 (no charge in respect of acquisition of approved CSOP scheme option). Sub-paragraph (1) has effect on the day appointed under paragraph 3(2).

In section 524 (no charge in respect of exercise of approved CSOP scheme option), omit subsection (4). Sub-paragraph (1) has effect on the day appointed under paragraph 3(2).

Omit section 525 (approved CSOP schemes: no charge in respect of post-acquisition benefits). Sub-paragraph (1) has effect in accordance with the provision made for the substitution of Chapter 4 of Part 7.

In section 526(4) (charge where approved CSOP scheme option granted at a discount: deductions of charge from amount chargeable under other provisions), for the words from the beginning to “deductions” substitute “Section 480(4) (gain realised on acquisition of securities pursuant to option etc) provides for a deduction”. Sub-paragraph (1) has effect—

Omit section 528 (enterprise management incentives: no charge in respect of acquisition of qualifying option). Sub-paragraph (1) has effect on the day appointed under paragraph 3(2).

In section 531(4) (enterprise management incentives: limitation of charge on exercise of qualifying option to acquire shares below market value), for the words after “which” substitute “under section 478 (amount of charge under section 476) is to be regarded as the taxable amount for the purposes of section 476 in respect of the acquisition of the shares pursuant to the option.”. Sub-paragraph (1) has effect on and after the day appointed under paragraph 3(2).

In section 532(5) (enterprise management incentives: modified tax consequences following disqualifying events), for the words after “which” substitute “under section 478 (amount of charge under section 476) is to be regarded as the taxable amount for the purposes of section 476 in respect of the acquisition of the shares pursuant to the option.”. Sub-paragraph (1) has effect on and after the day appointed under paragraph 3(2).

In section 538 (share conversions excluded for purposes of section 536), for subsection (4) substitute—. Sub-paragraph (1) has effect on and after the day appointed under paragraph 3(2).

In section 540(1) (enterprise management incentives: notional loan provisions not to apply in relation to acquisition of shares by exercise of qualifying option), for “Chapter 8 of Part 3” substitute “Chapter 3C of this Part”. Sub-paragraph (1) has effect in accordance with the provision made for the repeal of Chapter 8 of Part 3.

In section 541 (enterprise management incentives: effect on other income tax charges), for subsections (1) and (2) substitute—. So far as relating to— sub-paragraph (1) has effect in accordance with the provision made for the taking effect of the repeal, substitution or insertion.

Part 2 of Schedule 1 (index of defined expressions) is amended as follows. Omit the entries relating to— “acquisition (in Chapter 8 of Part 3)”, “the acquisition (in Chapter 8 of Part 3)”, “acquisition (in Chapter 9 of Part 3)”, “the acquisition (in Chapter 4 of Part 7)”, “as a director or employee, in relation to the acquisition of an interest in shares (in Chapter 2 of Part 7)”, “as a director or employee, in relation to the acquisition of shares or an interest in shares (in Chapter 3 of Part 7)”, “as a director or employee, in relation to the acquisition of shares or an interest in shares (in Chapter 4 of Part 7)”, “assign, in relation to a share option (in Chapter 5 of Part 7)”, “associated company (in Chapter 4 of Part 7)”, “company (in Chapter 5 of Part 7)”, “the Contributions and Benefits Act (in Chapter 5 of Part 7)”, “convertible, in relation to shares (in Chapter 3 of Part 7)”, “dependent subsidiary (in Chapter 4 of Part 7)”, “director (in Chapter 2 of Part 7)”, “director (in Chapter 3 of Part 7)”, “director (in Chapter 4 of Part 7)”, “director (in Chapter 5 of Part 7)”, “employee (in Chapter 8 of Part 3)”, “employee (in Chapter 9 of Part 3)”, “employee (in Chapter 2 of Part 7)”, “the employee (in Chapter 2 of Part 7)”, “employee (in Chapter 3 of Part 7)”, “the employee (in Chapter 3 of Part 7)”, “employee (in Chapter 4 of Part 7)”, “the employee (in Chapter 4 of Part 7)”, “employee (in Chapter 5 of Part 7)”, “the employee (in Chapter 5 of Part 7)”, “employee-controlled (in relation to a company) (in Chapter 4 of Part 7)”, “the employee’s interest (in Chapter 2 of Part 7)”, “the employer company (in Chapter 2 of Part 7)”, “the employer company (in Chapter 3 of Part 7)”, “the employer company (in Chapter 4 of Part 7)”, “employment-related shares (in Chapter 9 of Part 3)”, “the employment-related shares (in Chapter 8 of Part 3)”, “held by outside shareholders (in Chapter 4 of Part 7)”, “interest in shares (in Chapter 8 of Part 3)”, “interest in shares (in Chapter 9 of Part 3)”, “interest in shares (in Chapter 4 of Part 7)”, “market value (in Chapter 8 of Part 3)”, “market value (in Chapter 9 of Part 3)”, “market value (in Chapter 2 of Part 7)”, “only conditional (interest in shares) (in Chapter 2 of Part 7)”, “payment for the employment-related shares (in Chapter 8 of Part 3)”, “release, in relation to a share option (in Chapter 5 of Part 7)”, “secondary Class 1 contributions (in Chapter 5 of Part 7)”, “share option (in Chapter 5 of Part 7)”, “the share option (in Chapter 5 of Part 7)”, “shares (in Chapter 8 of Part 3)”, “shares (in Chapter 9 of Part 3)”, “shares (in Chapter 2 of Part 7)”, “the shares (in Chapter 2 of Part 7)”, “shares (in Chapter 3 of Part 7)”, “the shares (in Chapter 3 of Part 7)”, “shares (in Chapter 4 of Part 7)”, “the shares (in Chapter 4 of Part 7)”, “shares (in Chapter 5 of Part 7)”, “terms (in Chapter 2 of Part 7)”, “terms (in Chapter 3 of Part 7)”, and “value (in relation to shares) (in Chapter 4 of Part 7)”. the acquisition (in Chapters 1 to 4 of Part 7) section 421B(8) (see also section 446Q(4)) the acquisition (in Chapter 5 of Part 7) section 471(5) associated company (in section 421H(1) and Chapters 2 to 4 of Part 7) section 421H(2) associated person (in Chapters 1 to 4 of Part 7) section 421C associated person (in Chapter 5 of Part 7) section 472 chargeable event (in Chapter 3B of Part 7) section 446P(5) the Contributions and Benefits Act (in Chapter 5 of Part 7) section 484(7) consideration (in Chapters 2 to 5 of Part 7) sections 421(2) and 421A consideration given for the acquisition of employment-related securities (in Chapters 2 to 3A of Part 7) section 421I convertible securities (in Chapters 2 to 3A of Part 7) section 436 the employee (in Chapters 1 to 4 of Part 7) section 421B(8) the employee (in Chapter 5 of Part 7) section 471(5) employee-controlled (in Chapters 2 to 4 of Part 7) section 421H(1) the employer (in Chapters 1 to 4 of Part 7) section 421B(8) the employer (in Chapter 5 of Part 7) section 471(5) the employment (in Chapters 1 to 4 of Part 7) section 421B(8) the employment (in Chapter 5 of Part 7) section 471(5) employment-related securities (in Chapters 1 to 5 of Part 7) section 421B(8) (see also section 484(4)) employment-related securities option (in Chapter 5 of Part 7) section 471(5) interest, in relation to securities (or shares) (in Chapters 1 to 5 of Part 7) section 420(8) market value (in Chapters 1 to 5 of Part 7) section 421(1) non-commercial increase (in Chapter 3B of Part 7) section 446K(4) non-commercial reduction (in Chapter 3B of Part 7) section 446K(4) the notional loan (in Chapter 3C of Part 7) section 446S(1) recognised stock exchange section 841 of ICTA relevant period (in Chapter 3B of Part 7) section 446O restricted securities and restricted interest in securities (in Chapters 2, 3A and 3B of Part 7) sections 423 and 424 restriction (in Chapters 2, 3A and 3B of Part 7) section 432(8) secondary Class 1 contributions (in Chapter 5 of Part 7) section 484(7) securities (in Chapters 1 to 5 of Part 7) section 420 securities option (in Chapters 1 to 5 of Part 7) section 420(8) shares (in Chapters 1 to 5 of Part 7) section 420(8) valuation date (in Chapter 3B of Part 7) section 446O variation, in relation to a restriction (in Chapter 2 of Part 7) section 427(4) So far as relating to— sub-paragraphs (1) to (3) have effect in accordance with the provision made for the taking effect of the repeal, substitution or insertion.

For the purposes of this paragraph the market value of restricted shares is to be determined as if they were not. Shares are “restricted shares” if there is any contract, agreement, arrangement or condition which makes provision to which any of subsections (2) to (4) of section 423 (restricted securities) would apply if the references in those subsections to the employment-related securities were to the shares. Sub-paragraph (1) has effect in accordance with the provision made for the substitution of Chapter 2 of Part 7.

In paragraph 42(3) of Schedule 3 (approved SAYE option schemes: withdrawal of approval), for paragraph (b) substitute—. Sub-paragraph (1) has effect in accordance with the provision made for the substitution of Chapter 4 of Part 7.

Schedule 5 (enterprise management incentives) is amended as follows. For the purposes of this paragraph the market value of restricted shares is to be determined as if they were not. Shares are “restricted shares” if there is any contract, agreement, arrangement or condition which makes provision to which any of subsections (2) to (4) of section 423 (restricted securities) would apply if the references in those subsections to the employment-related securities were to the shares. Where the shares that may be acquired by the employee are restricted shares, the agreement must contain details of the restrictions. For the purposes of sub-paragraph (4)— Sub-paragraphs (1) to (3) have effect in accordance with the provision made for the substitution of Chapter 2 of Part 7.

Schedule 7 (transitionals and savings) is amended as follows. Omit paragraphs 30 and 31. In the heading of Part 6, for “share-related” substitute “related to securities”. In the heading of Part 7, for “share-related income” substitute “income related to securities”. Before paragraph 44 insert—. In paragraph 44, after “Part 7” insert “, as originally enacted,”. In paragraph 45(1), at end insert “, as originally enacted.”. In paragraph 46(1), after “disposal)” insert “, as originally enacted,”. Omit paragraphs 47 and 48. In paragraph 49, for “shares” substitute “securities”. Omit paragraphs 50 to 52. Omit paragraph 53. In paragraph 54, after “Part 7” insert “, both as originally enacted and as substituted by the Finance Act 2003,”. In paragraph 55— In paragraph 56, after “section 449” insert “, as originally enacted,”. In paragraph 58(1), at end insert “, as originally enacted.” Omit paragraph 59. Omit paragraphs 60 and 61. After paragraph 61 insert—. Omit paragraph 62. For paragraph 63 substitute—. In paragraph 64— In paragraph 65— Omit paragraph 66. Omit paragraph 67. In this paragraph—

A transaction between one party to a marriage and the other is exempt from charge if it is effected—

For the purposes of this Schedule a “disadvantaged area” means an area designated as a disadvantaged area by regulations made by the Treasury. The regulations may— If the regulations so provide, the designation of an area as a disadvantaged area shall have effect for such period as may be specified by or determined in accordance with the regulations. The regulations may—

If all the land is non-residential property, the transaction is exempt from charge.

This paragraph applies where all the land situated in a disadvantaged area is residential property. If— none of the consideration so attributable counts as chargeable consideration. If the consideration attributable to land situated in a disadvantaged area includes rent and the relevant rental value does not exceed £150,000, the rent so attributable does not count as chargeable consideration. If the consideration attributable to land in a disadvantaged area includes consideration other than rent (“non-rent consideration”), then—

For the purposes of this Schedule “rent” has the same meaning as in Schedule 5 (amount of tax chargeable: rent) and “annual rent” has the same meaning as in paragraph 9(2) of that Schedule.

A land transaction return must— In sub-paragraph (1) “prescribed” means prescribed by regulations made by the Inland Revenue. The regulations may make different provision for different kinds of return. Regulations under sub-paragraph (1)(b) may require the provision of information corresponding to any of the particulars formerly required under— The return is treated as containing any information provided by the purchaser for the purpose of completing the return.

A purchaser who is required to deliver a land transaction return in respect of a chargeable transaction and fails to do so within twelve months after the filing date is liable to a tax-related penalty under this paragraph. This is in addition to any flat-rate penalty under paragraph 3. The penalty is an amount not exceeding the amount of tax chargeable in respect of the transaction.

The Inland Revenue may amend a land transaction return so as to correct obvious errors or omissions in the return (whether errors of principle, arithmetical mistakes or otherwise). A correction under this paragraph is made by notice to the purchaser. No such correction may be made more than nine months after— A correction under this paragraph is of no effect if the purchaser— Notice under sub-paragraph (4)(b) must be given to the officer of the Board by whom notice of the correction was given.

The duty under paragraph 9 to preserve records may be satisfied by the preservation of the information contained in them. Where information is so preserved a copy of any document forming part of the records is admissible in evidence in any proceedings before the Commissioners to the same extent as the records themselves.

An enquiry extends to anything contained in the return, or required to be contained in the return, that relates— This is subject to the following exception. If the notice of enquiry is given as a result of an amendment of the return under paragraph 6 (amendment by purchaser)— the enquiry into the return is limited to matters to which the amendment relates or that are affected by the amendment.

A person who fails to comply with a notice under paragraph 14 (notice to produce documents etc for purposes of enquiry) is liable— The amount referred to in sub-paragraph (1)(b) is— No penalty shall be imposed under this paragraph in respect of a failure at any time after the failure has been remedied.

At any time when an enquiry is in progress into a land transaction return any question arising in connection with the subject-matter of the enquiry may be referred to the Special Commissioners for their determination. Notice of referral must be given— The notice of referral must specify the question or questions being referred. More than one notice of referral may be given under this paragraph in relation to an enquiry. For the purposes of this paragraph the period during which an enquiry is in progress is the whole of the period—

The determination of a question referred to the Special Commissioners under paragraph 19 is binding on the parties to the referral in the same way, and to the same extent, as a decision on a preliminary issue in an appeal. The determination shall be taken into account by the Inland Revenue— Any right of appeal under paragraph 35 (appeals against assessments etc) may not be exercised so as to reopen the question determined except to the extent (if any) that it could be reopened if it had been determined as a preliminary issue in that appeal.

If after a Revenue determination has been made the purchaser delivers a land transaction return in respect of the transaction, the self-assessment included in that return supersedes the determination. Sub-paragraph (1) does not apply to a return delivered— whichever is the later. Where— the proceedings may be continued as if they were proceedings for the recovery of so much of the tax charged by the self-assessment as is due and payable and has not been paid.

A purchaser who may be required to give a self-certificate must— The records must be preserved for six years after the effective date of the transaction and until any later date on which— The records required to be kept and preserved under this paragraph include—

If the Inland Revenue give notice of enquiry into a self-certificate, they may by notice in writing require the purchaser— as they may reasonably require for the purposes of the enquiry. A notice under this paragraph (which may be given at the same time as the notice of enquiry) must specify the time (which must not be less than 30 days) within which the purchaser is to comply with it. In complying with a notice under this paragraph copies of documents may be produced instead of originals, but— A notice under paragraph (b) must specify the time (which must not be less than 30 days) within which the purchaser is to comply with it. The Inland Revenue may take copies of, or make extracts from, any documents produced to them under this paragraph. A notice under this paragraph does not oblige the purchaser to produce documents or provide information relating to the conduct of—

At any time when an enquiry is in progress into a self-certificate any question arising in connection with the subject-matter of the enquiry may be referred to the Special Commissioners for their determination. Notice of referral must be given— The notice of referral must specify the question or questions being referred. More than one notice of referral may be given under this paragraph in relation to an enquiry. For the purposes of this paragraph the period during which an enquiry is in progress is the whole of the period—

The determination of a question referred to the Special Commissioners under paragraph 12 is binding on the parties to the referral in the same way, and to the same extent, as a decision on a preliminary issue in an appeal. The determination shall be taken into account by the Inland Revenue— Any right of appeal under paragraph 35 of Schedule 10 (appeals against assessments etc) may not be exercised so as to reopen the question determined except to the extent (if any) that it could be reopened if it had been determined as a preliminary issue in that appeal.

In Scotland, where any tax is due and has not been paid, the sheriff, on an application by the collector accompanied by a certificate by the collector— shall grant a summary warrant in a form prescribed by Act of Sederunt authorising the recovery, by any of the diligences mentioned in sub-paragraph (2), of the amount remaining due and unpaid. The diligences referred to in sub-paragraph (1) are— Subject to sub-paragraph (4), the sheriff officer’s fees, together with the outlays necessarily incurred by him, in connection with the execution of a summary warrant are chargeable against the debtor. No fee is chargeable by the sheriff officer against the debtor for collecting, and accounting to the collector for, sums paid to him by the debtor in respect of the amount owing.

After notice has been served of the determination of a penalty, the determination cannot be altered except in accordance with this paragraph or on appeal. If it is discovered by an authorised officer that the amount of the penalty is or has become insufficient, the officer may make a determination in a further amount so that the penalty is set at the amount which in the officer’s opinion is correct or appropriate. If in the case of a tax-related penalty it is discovered by an authorised officer that the amount taken into account as the amount of tax is or has become excessive, he may revise the determination so that the penalty is set at the amount that is correct. Where more than the correct amount has already been paid the appropriate amount shall be repaid. In this paragraph an “authorised officer” means an officer of the Board authorised by the Board for the purposes of this paragraph.

An appeal lies against the amount of a penalty determined by the Commissioners on an appeal under paragraph 5, at the instance of the person liable to the penalty— On an appeal under this paragraph the court has the same powers as are conferred on the Commissioners by paragraph 5(4) above. The right of appeal under this paragraph is in addition to any right of appeal conferred by regulations under paragraph 9 of Schedule 17 (general power to provide for appeals on points of law).

This paragraph applies where stamp duty under Part 1 of Schedule 13 to the Finance Act 1999 (c. 16) (transfer on sale) is chargeable on an instrument that relates partly to stock or marketable securities and partly to property other than stock or marketable securities. In such a case—

In section 12 of the Finance Act 1895 (c. 16) (collection of stamp duty in cases of property vested by Act or purchased under statutory powers)—

The Treasury may by regulations make such other amendments or repeals of enactments relating to stamp duty or stamp duty reserve tax as appear to them appropriate in consequence of the abolition of stamp duty except on instruments relating to stock or marketable securities. The regulations may include such transitional provisions and savings as appear to the Treasury to be appropriate. Regulations under this paragraph shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of the House of Commons.

The Income Tax (Earnings and Pensions) Act 2003 (c. 1) is amended as follows.

Paragraph 30 (withdrawal of approval) is amended as follows. In sub-paragraph (2), after “to be met;” insert—. For the purposes of sub-paragraph (2)(aa) the Inland Revenue may not withhold their approval unless it appears to them at the time in question that the scheme as proposed to be altered would not then be approved on an application under paragraph 28. For the purposes of that sub-paragraph a “key feature” of a scheme is a provision of the scheme which is necessary in order to meet the requirements of this Schedule. For paragraph 31 (approval ineffective after unapproved alteration and notice of decisions) and the heading before it substitute—. For paragraph 32(1)(b) (appeal against decision not to approve alteration) substitute—.

The business for the purposes of which the award or grant is made must— A business is within the charge to corporation tax if, or to the extent that, it is carried on by a company that is within the charge to corporation tax in respect of the profits of the business.

The shares acquired must be shares in—

The amount of the relief is allowed as a deduction in computing for the purposes of corporation tax the profits of the business for the purposes of which the award was made. If the company carrying on that business is an investment company, the amount of the relief is treated as disbursed as expenses of management for the purposes of section 75 of the Taxes Act 1988. If the company carrying on that business is an insurance company carrying on life assurance business, the amount of the relief is included among the amounts the company may treat as part of its expenses of management for the purposes of section 76 of the Taxes Act 1988. If the award was made for the purposes of more than one business within the charge to corporation tax, the amount of the deduction must be apportioned between them on a just and reasonable basis.

The company whose shares are acquired in exercise of the option must be—

The amount of the relief is equal to the difference between— The consideration mentioned in sub-paragraph (1)(b) does not include— A just and reasonable apportionment shall be made for the purposes of this paragraph of any consideration given partly in respect of the grant or exercise of the option and partly in respect of other matters. If the option was granted partly for the purposes of a business meeting the requirements of paragraph 3 (business must be within the charge to corporation tax) and partly for the purposes of a business in relation to which those requirements are not met, the amount of the relief shall be reduced to such extent as is just and reasonable.

Where the recipient acquires shares that are subject to forfeiture, this paragraph applies in place of paragraph 7 or 14 (income tax position of the employee). It must be the case that the employee— The conditions mentioned in sub-paragraph (2)(b) are—

Where relief under this Schedule is available for any accounting period, no other deduction is allowed for any corporation tax purposes (whether for that or any other period) in respect of the cost of providing the shares. This applies to any deduction, whether by the employing company or any other company, in computing chargeable profits for the purposes of corporation tax. For this purpose the cost of providing the shares— The following are not regarded as part of the cost of providing the shares— In this paragraph “employee share scheme” means any scheme or arrangement for enabling shares to be acquired by reason of employees' employment.

For the purposes of this Schedule—

In this Schedule the following expressions are defined or otherwise explained by the provisions indicated: commercial association of companies paragraph 29(2) consortium paragraph 29(1) Contributions and Benefits Act paragraph 30 control paragraph 30 employment and related expressions paragraph 26 the employee paragraph 1(3) employing company paragraph 1(3) group paragraph 28(b) group company paragraph 28(a) insurance company paragraph 30 investment company paragraph 30 life assurance business paragraph 30 market value paragraph 30 option paragraph 30 ordinary shares paragraph 30 parent company paragraph 28(c) the recipient paragraph 1(3) shares paragraph 30 subject to forfeiture paragraph 19 within the charge to corporation tax (of a business) paragraph 3(2)

The Taxes Act 1988 is amended as follows. In section 606 (persons responsible in case of default of administrator of retirement benefits scheme), for subsection (13) substitute—. In section 806L (carry forward or carry back of unrelieved foreign tax), for subsection (7) substitute—. In Schedule 15 (qualifying policies), in paragraph 24 (policies issued by non-resident companies), in sub-paragraph (3)(b) (twice) and (c) for “branch” substitute “permanent establishment”.

Section 126 of the Finance Act 1995 (c. 4) (UK representatives of non-residents) is amended as follows. In subsection (1), omit the words “, corporation tax”. In subsection (2)— For subsection (8) substitute—. In subsection (9), omit paragraph (b) and the word “and” preceding it. After subsection (9) insert—.

Paragraph 1 (entitlement to R&D tax relief) is amended as follows. In sub-paragraph (1)(b) (requirement for minimum aggregate expenditure of £25,000 or time apportioned part of that amount) in sub-paragraphs (i) and (ii) for “£25,000” substitute “£10,000”.

In paragraph 5 (staffing costs) sub-paragraph (3) (person partly engaged in relevant research and development) is amended as follows. In the opening words, omit “the following rules apply”. Omit paragraphs (a) and (b) (person spending less than 20% or more than 80%of total working time on relevant research and development). In paragraph (c), omit “in any other case,”.

The second condition is that the expenditure—

Schedule 13 to the Finance Act 2002 (tax relief for expenditure on vaccine research etc) is amended in accordance with the following provisions of this Part of this Schedule.

Paragraph 5(3) (which applies certain definitions in Schedule 20 to the Finance Act 2000 (c. 17)) is amended as follows. Omit the word “and” immediately preceding paragraph (d). In paragraph (d), for “(subsidised expenditure),” substitute “(subsidised expenditure); and”. After paragraph (d) insert the following paragraph—. The heading to paragraph 5 accordingly becomes—.

“investment reserve”, in relation to an insurance company, means the excess of the value of the assets of the company’s long-term business over the aggregate of—

After section 539 of the Taxes Act 1988 insert—.

If any death giving rise to benefits under a group life policy occurs— subsection (6) of section 552 of the Taxes Act 1988 (relevant three month period for insurer to give certificate under section 552(1)(a) to policy holder) shall have effect in relation to that policy and that death as if there were included among the paragraphs of that subsection the unnumbered paragraph set out in sub-paragraph (2). That paragraph is—.

Section 547 of the Taxes Act 1988 is amended as follows. In subsection (5)(a) (individual to be treated as having paid income tax at the basic rate on a sum included in his income by virtue of subsection (1)(a)) for “the basic rate” substitute “the lower rate”. In subsection (9A)(a) (definition of “the appropriate rate” where charitable trustees are liable to income tax on a gain by virtue of subsection (9)) for “the basic rate for that year” substitute “the lower rate”.

In section 833(3)(b) of the Taxes Act 1988 (which provides that, where income falls to be treated as the highest part of a person’s income, his income shall be calculated without regard to any amount included in total income by virtue of section 547(1)(a)) after “section 547(1)(a)” add “which is a sum in relation to which section 547(5) applies”.

An individual is not eligible for relief under this Part of this Schedule by reference to any shares which are treated as issued to him by virtue of section 195(8) of the Finance Act 2003 (tax treatment of disposal by company of its own shares). Where a company which is a venture capital trust issues to any individual eligible shares to which sub-paragraph (10) above applies, it must—

Section 108 of the Taxes Management Act 1970 (c. 9) (responsibility of company officers) is amended as follows. In subsection (3)(a)— After subsection (3) insert—.

Subject to sub-paragraph (2), this Schedule has effect in relation to companies which enter administration (whether under the Insolvency Act 1986 (c. 45) or otherwise) on or after the commencement of section 248 of the Enterprise Act 2002 (c. 40) (which substitutes Part 2 of the Insolvency Act 1986 (administration)). Paragraph 4 has effect in relation to companies which— For this purpose “insolvent liquidation” and “insolvent administration” are to be construed in accordance with paragraph 6A of Schedule 9 to the Finance Act 1996 (c. 8) (as amended by paragraph 4 above).

Section 127 of the Finance Act 1995 (persons not treated as UK representatives) is amended as follows. In subsection (1) for “(a) to (d)” substitute “(a) to (c)”. In subsection (5)(b) omit “or 129”. In subsection (17), in the definition of “branch or agency” for “the Management Act” substitute “section 126 above”. In subsection (19) omit paragraph (b) and the word “and” preceding it.

In section 432A(9A) of the Taxes Act 1988 (apportionment of income and gains: meaning of “net value”), for the words after “assets over” substitute “the value of money debts (within the meaning of Chapter 2 of Part 4 of the Finance Act 1996) attributable to an internal linked fund which are not owed in respect of long-term liabilities.”.

In section 128 of the Finance Act 1989 (limit on income chargeable on non-residents: income tax), after subsection (11) insert—.

In paragraph 4(5) of Schedule 19AA to the Taxes Act 1988 (overseas life assurance fund), in the definition of “investment reserve”, for paragraphs (a) and (b) substitute—.

Omit section 129 of the Finance Act 1995 (c. 4) (limit on income chargeable on non-residents: corporation tax).

Paragraphs 25 to 27 have effect in relation to periods of account beginning on or after 1st January 2003.

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

Paragraph 34 (exercise of options: scheme-related employment ends) is amended as follows. In sub-paragraph (2)(a), after “1996” insert “or ER(NI)O 1996”. In sub-paragraph (5)— If the scheme makes provision by virtue of sub-paragraph (5), the provision must be either—

Section 524 (no charge in respect of exercise of option under CSOP scheme) is amended as follows. For subsection (1)(b) substitute—. For subsections (2) and (3) substitute—. For section 525(1)(b) (no charge in respect of post-acquisition benefits) substitute—. This paragraph has effect in relation to any exercise of an option on or after 9th April 2003.

Section 701(2)(c) (PAYE: exclusions from meaning of “asset”) is amended as follows. In sub-paragraph (i), omit “or 4 (approved CSOP schemes)”. After that sub-paragraph insert—. In sub-paragraph (ii), for “such a scheme” substitute “a scheme such as is mentioned in sub-paragraph (i) or (ia)”. This paragraph has effect in relation to shares acquired on or after 9th April 2003.

For paragraphs 1 and 2 (introduction and general scheme of Schedule) substitute—

Paragraph 6 is amended as follows. In sub-paragraph (1), in the opening words, for “the amount of any chargeable gains” substitute “the tapered amount of any chargeable gains”. The reference in sub-paragraph (1) to the tapered amount of any chargeable gains is a reference—

In section 39—

Expenditure qualifying under section 45H (expenditure on environmentally beneficial plant or machinery) 100%

After Part 2 of Schedule 12 to the Finance Act 2002 (entitlement to relief for R&D expenditure: work sub-contracted to small or medium-sized enterprise) insert the following Part—.

Section 1A of the Taxes Act 1988 (application of lower rate to income from savings and distributions) is amended as follows. In subsection (2) (which specifies the income to which the lower rate applies) omit the word “and” immediately preceding paragraph (c) and at the end of that paragraph insert ; and. In subsection (5) (ordering rule for highest part of income for the purposes of the Income Tax Acts) after “the Income Tax Acts” insert “(other than section 550)”.

In section 699A(4)(b) of the Taxes Act 1988 (sums included in aggregate income of estate of the deceased by virtue of section 547(1)(c) to be assumed to bear tax at the basic rate) for “the basic rate” substitute “the lower rate”.

This paragraph applies to an individual for a year of assessment for which— If the individual’s foster care receipts for the year of assessment are the receipts of a trade, profession or vocation, the profits or losses from that trade, profession or vocation for the year are to be treated as nil. If, in a case falling within sub-paragraph (2), the individual would, apart from that sub-paragraph, be entitled to a deduction for the year under section 63A(1) or (3) of the Taxes Act 1988 (overlap profits and overlap losses), the individual is entitled to that deduction notwithstanding that sub-paragraph. Sub-paragraph (5) applies if the individual’s foster care receipts for the year of assessment are receipts from one or more foster care arrangements. For each foster care arrangement from which those receipts arise, the amount of— is to be treated as nil.

This paragraph applies if— The amount of the profits of the year of assessment from all of the foster care arrangements from which the individual’s foster care receipts arise is—

Capital expenditure (“excluded capital expenditure”) which is incurred— does not constitute qualifying expenditure for the purposes of CAA 2001.

Paragraph 2 is amended as follows. A person who is a participator in a company which controls another company shall be treated for the purposes of this paragraph as also being a participator in that other company. In sub-paragraph (6), in the definition of “participator” (which is expressed to have effect in relation to a close company) omit “close”. The amendments made by this paragraph have effect in relation to interest which would, apart from paragraph 2 of Schedule 9 to the Finance Act 1996 (c. 8), be treated as accruing on or after 9th April 2003.

Paragraph 18 is amended as follows. In sub-paragraph (2C) (reference to person standing in the position of creditor to include person indirectly standing in that position) for the words from “includes a reference” to the end of that sub-paragraph substitute “includes a reference to a person who indirectly stands in that position by reference to a series of loan relationships or money debts which would be loan relationships if a company directly stood in the position of creditor or debtor”. A person who is a participator in a company which controls another company shall be treated for the purposes of this paragraph as also being a participator in that other company. The amendments made by this paragraph have effect in relation to relevant periods beginning on or after 9th April 2003. If, in the case of an issuing company, 9th April 2003 falls in a relevant period beginning before that day— Expressions used in sub-paragraph (4) or (5) and in paragraph 18 of Schedule 9 to the Finance Act 1996 (c. 8) have the same meaning in that sub-paragraph as in that paragraph.

In Schedule 13 to the Finance Act 1996 (discounted securities: income tax provisions), paragraph 1 (charge to tax on realised profit comprised in discount) is amended as follows. In sub-paragraph (2) (meaning of “realising the profit” from the discount on a relevant discounted security) at the end of paragraph (b) insert “(no account being taken of any costs incurred in connection with the transfer or redemption of the security or its acquisition)”. In sub-paragraph (3)(a) (calculation of profit) omit “reduced by the amount of any relevant costs”. Omit sub-paragraph (4) (meaning of “relevant costs”).

In the definition of “strip” in paragraph 15(1) of that Schedule, for “is a strip of a gilt-edged security” substitute “is a strip of a security, or would be if that section had effect with the substitution in subsection (1B) of “issued by or on behalf of the government of any territory” for “issued under the National Loans Act 1968””.

Schedule 4 (approved CSOP schemes) is amended as follows. After paragraph 35 insert—.

The Capital Allowances Act 2001 (c. 2) is amended as follows.

In section 46(1)— In section 46(5) for “or 45E” substitute “, 45E or 45H”.

For the purposes of section 45H(2) of the Capital Allowances Act 2001, where— those conditions shall be treated as if they were met at the relevant time. In sub-paragraph (1) “the relevant time” means the time when the expenditure was incurred or (as the case may be) the contract was entered into.

In section 550(3) of the Taxes Act 1988 (rates of tax to be applied in calculating tax which would be chargeable on gain if calculated by reference to the appropriate fraction) for “the basic rate” substitute “the lower rate”.

In this Schedule—

References in this Part of this Act to the filing date, in relation to a land transaction return, are to the last day of the period within which the return must be delivered. References in this Part of this Act to the delivery of a land transaction return are to the delivery of a return that—

If it appears to the Inland Revenue— they may issue a notice requiring him to deliver a land transaction return in respect of the transaction. The notice must specify— If the purchaser does not comply with the notice within the specified period, the Inland Revenue may apply to the General or Special Commissioners for an order imposing a daily penalty. On such an application the Commissioners may direct that the purchaser shall be liable to a penalty or penalties not exceeding £60 for each day on which the failure continues after the day on which he is notified of the direction. This paragraph does not affect, and is not affected by, any penalty under paragraph 3 or 4 (flat-rate or tax-related penalty for failure to deliver return).

A purchaser who— is liable to a tax-related penalty. The penalty is an amount not exceeding the amount of tax understated, that is, the difference between—

A person who believes he has been assessed to tax more than once in respect of the same matter may make a claim for relief under this paragraph. The claim must be made by notice in writing given to the Inland Revenue. If on a claim being made the Inland Revenue are satisfied that the person has been assessed to tax more than once in respect of the same matter, they shall amend the assessment or assessments concerned or give relief by way of discharge or repayment of tax or otherwise, to eliminate the double charge. An appeal against a decision of the Inland Revenue on a claim for relief under this paragraph may be brought to the Commissioners having jurisdiction to hear an appeal relating to the assessment, or the later of the assessments, to which the claim relates.

Notice of an appeal under paragraph 35 must be given— In relation to an appeal under paragraph 35(1)(a)— In relation to an appeal under paragraph 35(1)(b)— In relation to an appeal under paragraph 35(1)(c) or (d)— The notice of appeal must specify the grounds of appeal. On the hearing of the appeal the Commissioners may allow the appellant to put forward grounds not specified in the notice, and take them into consideration, if satisfied that the omission was not deliberate or unreasonable.

If the appellant has grounds for believing that he is overcharged to tax by the decision appealed against, he may by notice in writing apply to the Commissioners for a direction that payment of an amount of tax shall be postponed pending the determination of the appeal. The notice must— An application may be made more than 30 days after the specified date if there is a change in the circumstances of the case as a result of which the appellant has grounds for believing that he is overcharged to tax by the decision appealed against. If, after any determination on such an application of the amount of tax the payment of which should be postponed, there is a change in the circumstances of the case as a result of which either party has grounds for believing that the amount so determined has become excessive or, as the case may be, insufficient, he may, by notice in writing given to the other party at any time before the determination of the appeal, apply to the Commissioners for a further determination of that amount. An application under this paragraph shall be heard and determined by the Commissioners in the same way as an appeal. The fact that any such application has been heard and determined by any Commissioners does not preclude them from hearing and determining the appeal or any further application under this paragraph. The amount of tax of which payment is to be postponed pending the determination of the appeal is the amount (if any) by which it appears to the Commissioners, having regard to the representations made and any evidence adduced, that there are reasonable grounds for believing that the appellant is overcharged. Where an application is made under this paragraph, the date on which any tax of which payment is not postponed is due and payable shall be determined as if the tax were charged by an amendment or assessment of which notice was issued on the date on which the application was determined and against which there was no appeal. On the determination of the appeal—

A self-certificate must— In sub-paragraph (1) “prescribed” means prescribed by regulations made by the Inland Revenue. The regulations may make different provision for different kinds of self-certificate.

The duty under paragraph 4 to preserve records may be satisfied by the preservation of the information contained in them. Where information is so preserved a copy of any document forming part of the records is admissible in evidence in any proceedings before the Commissioners to the same extent as the records themselves.

An enquiry extends to anything contained in the certificate, or required to be contained in the certificate, that relates—

A person who fails to comply with a notice under paragraph 9 (notice to produce documents etc for purposes of enquiry) is liable— The amount referred to in sub-paragraph (1)(b) is— No penalty shall be imposed under this paragraph in respect of a failure at any time after the failure has been remedied.

While proceedings on a referral under paragraph 12 are in progress in relation to an enquiry— For the purposes of this paragraph proceedings on a referral are in progress where— For the purposes of sub-paragraph (2)(c) a question referred is finally determined when—

The purchaser may apply to the General or Special Commissioners for a direction that the Inland Revenue give a closure notice within a specified period. Any such application shall be heard and determined in the same way as an appeal. The Commissioners hearing the application shall give a direction unless they are satisfied that the Inland Revenue have reasonable grounds for not giving a closure notice within a specified period.

An authorised officer of the Board may by notice in writing require a person— An “authorised officer of the Board” means an officer of the Board authorised for the purposes of this Part of this Schedule. Before a person is given a notice under this paragraph he must be given a reasonable opportunity to deliver the documents or provide the information in question. No application for consent under paragraph 2 shall be made unless he has been given that opportunity.

An officer who gives a notice under paragraph 1 must also give to the person to whom the notice applies a written summary of his reasons for applying for consent to the notice. This does not require the disclosure of any information— A Commissioner shall not give any such direction unless he is satisfied that the officer has reasonable grounds for believing that disclosure of the information in question would prejudice the assessment or collection of tax.

The consent of a General or Special Commissioner is required for the giving of a notice under paragraph 6. Consent shall not be given unless the Commissioner is satisfied that in all the circumstances the officer is justified in proceeding under that paragraph. A Commissioner who has given such consent shall not take part in, or be present at, any proceedings on, or related to, any appeal brought by the taxpayer concerned if the Commissioner has reason to believe that any of the documents that were the subject of the notice is likely to be adduced in evidence in those proceedings.

An officer who gives a notice under paragraph 6 must also give to the taxpayer concerned a written summary of his reasons for applying for consent to the notice. This does not require the disclosure of any information— A Commissioner shall not give such a direction unless he is satisfied that the officer has reasonable grounds for believing that disclosure of the information in question would prejudice the assessment or collection of tax. This paragraph does not apply if under paragraph 9(2) a copy of the notice need not be given to the taxpayer.

The person to whom documents are delivered or made available in pursuance of a notice under this Part of this Schedule may take copies of them or of extracts from them.

The appropriate judicial authority, if satisfied on information on oath given by an officer of the Board that— may issue a warrant in writing authorising an officer of the Board to enter the premises, if necessary by force, at any time within 14 days from the time of issue of the warrant, and search them. The appropriate judicial authority is— Where in Scotland the information relates to premises situated in different sheriffdoms— This does not affect any power or jurisdiction of a sheriff to issue a warrant in respect of an offence committed within his own sheriffdom.

The powers conferred by a warrant under this Part of this Schedule are not exercisable—

An officer of the Board who removes anything in the exercise of the powers conferred by this Part of this Schedule shall, if so requested by a person showing himself— provide that person with a record of what he removed. The officer of the Board shall provide the record within a reasonable time from the making of the request for it.

Where entry has been made with a warrant under this Part of this Schedule, and the officer making the entry has seized any things under the authority of the warrant, he shall endorse on or attach to the warrant a list of the things seized. The following provisions (which relate to return, retention and inspection of warrants), that is— apply to a warrant under this Part of this Schedule (together with any list endorsed on or attached to it under sub-paragraph (1)) as they apply to a warrant issued to a constable under any enactment.

Where property is held in trust under the law of Scotland, or of a country or territory outside the United Kingdom, on terms such that, if the trust had effect under the law of England and Wales, a beneficiary would be regarded as having an equitable interest in the trust property—

Where the trustees of a settlement are liable— the payment, penalty or interest may be recovered (but only once) from any one or more of the responsible trustees. No amount may be recovered by virtue of sub-paragraph (1)(c) from a person who did not become a responsible trustee until after the relevant time. The responsible trustees, in relation to a land transaction, are the persons who are trustees at the effective date of the transaction and any person who subsequently becomes a trustee. The relevant time for this purpose is—

Where the General or Special Commissioners have jurisdiction in respect of a matter, the Lord Chancellor may make regulations for determining— Where the General Commissioners have jurisdiction in respect of a matter, the General Commissioners for that division which is determined in accordance with regulations made by the Lord Chancellor under this paragraph are to have the jurisdiction. The Lord Chancellor may make regulations—

The Lord Chancellor may make regulations about the practice and procedure to be followed in connection with matters in respect of which the Special or General Commissioners have jurisdiction. The regulations may, in particular, include provision—

The Lord Chancellor may make regulations about the following matters— The regulations may— The regulations may—

The Income and Corporation Taxes Act 1988 (c. 1) is amended as follows. In section 209B(4) (hedging arrangements), in subsection (4) for “or stamp duty” substitute “(including stamp duty or stamp duty land tax)”. In section 213 (exempt distributions), in subsection (11)(a) for “stamp duty” substitute “stamp duty or stamp duty land tax”. In section 214 (chargeable payments connected with exempt distributions), in subsection (2) for “stamp duty” substitute “stamp duty or stamp duty land tax”. In section 215 (advance clearance by Board of distributions and payments), in subsection (2) for “stamp duty” substitute “stamp duty or stamp duty land tax”. In section 827 (penalties and interest not allowed as deductions for tax purposes), after subsection (1F) insert—.

In section 277 of the Income Tax (Earnings and Pensions) Act 2003 (c. 1) (removal benefits and expenses: acquisition of property), in subsection (3)(e) after “stamp duty” insert “or stamp duty land tax”.

The Income Tax (Earnings and Pensions) Act 2003 (c. 1) is amended as follows.

The provisions of this Part of this Schedule apply in the case of the grant of an option to acquire shares. Where the shares acquired in exercise of the option are subject to forfeiture, the provisions of this Part have effect subject to the provisions of Part 4 of this Schedule.

It must be the case that the employee— In sub-paragraph (1)(b) a “relevant exemption” means an exemption under— The conditions mentioned in sub-paragraph (1)(c) are—

The relief is given for the accounting period in which the shares are acquired in exercise of the option. The time when the shares are acquired is when the recipient acquires a beneficial interest in the shares and not, if different, the time the shares are conveyed or transferred.

For the purposes of this Schedule qualifying benefits are provided where there is a payment of money or transfer of assets, otherwise than by way of loan, that— In sub-paragraph (1)(a)— The conditions mentioned in sub-paragraph (1)(a) are— In this paragraph “the Contributions and Benefits Act” means— Where the provision of a qualifying benefit takes the form of the payment of money, the benefit is treated for the purposes of this Schedule as provided at the time when the money is treated as received for the purposes of Chapter 4 of Part 2 of the Income Tax (Earnings and Pensions) Act 2003, applying the rules in section 18 of that Act (receipt of money earnings).

This paragraph applies where the provision of a qualifying benefit takes the form of the transfer of an asset. The amount provided shall be taken for the purposes of this Schedule to be the total of— But where the amount given by sub-paragraph (2) above is more than the amount that is charged to tax under the Income Tax (Earnings and Pensions) Act 2003 (c. 1) in respect of the transfer, or would be so charged if the condition in paragraph 2(3)(a) were met, the deduction allowable under paragraph 1(3) or (4) is limited to that lower amount.

This Schedule does not apply to any deduction that is allowable—

This Schedule has effect in relation to deductions that would (but for this Schedule) be allowed for a period ending on or after 27th November 2002 in respect of employee benefit contributions made on or after that date. In relation to any time before the coming into force of the Income Tax (Earnings and Pensions) Act 2003 (c. 1), this Schedule has effect as if— In relation to any such time, sections 43(11)(a) and 44(9)(a) of the Finance Act 1989 have effect with the omission of the words “or benefits” and “, or held by an intermediary,”. In relation to a period beginning before 1st January 2003, the reference in paragraph 8(g) to a deduction allowable under Schedule 23 to this Act shall be read as a reference to a deduction allowable to a company for that period in respect of a person— whether in that period or subsequently, by reason of his or another’s employment with the company.

After paragraph 7 insert—.

In paragraph 10(1) for “of the transferor settlement, or of any transferee settlement,” substitute “of any relevant settlement”. In paragraph 12— In paragraph 13(5)(a) for “that in which the transfer of value was made” substitute “the year of the gain (determined in accordance with paragraph 8B(3))”. After paragraph 13 insert—.

Paragraphs 17 to 19 make provision for the application of the Capital Allowances Act 2001 (c. 2) (“CAA 2001”) in relation to— For this purpose, a “relevant individual” is an individual who, in a year of assessment, satisfies the conditions in sub-paragraphs (3) and (4). The first condition is that in the year of assessment the individual would, apart from this Schedule, have foster care receipts chargeable— The second condition is that— A period is a “relevant chargeable period” of a relevant individual if—

Where a relevant individual incurs excluded capital expenditure in a relevant chargeable period, section 13 of CAA 2001 shall apply as if, on the first day of the first subsequent chargeable period which is not a relevant chargeable period,—

Paragraph 12 is amended as follows. In sub-paragraph (2) (determination of credits and debits to be brought into account) in paragraph (a) (disregard of the transaction or series of transactions except for certain purposes) after “except” insert—. In paragraph (b) of that sub-paragraph (transferor and transferee deemed to be the same person, except for that purpose) for “that purpose” substitute “those purposes”. In sub-paragraph (2A) (amount to be brought into account where transferor company uses authorised mark to market basis of accounting) for paragraph (a) substitute—. In sub-paragraph (6) (novation: equivalent rights) after “rights” insert “, or (as the case may be) its obligations,”. For the purposes of sub-paragraph (6) above a person’s obligations under a debtor relationship are equivalent to obligations under another such relationship if they subject the holder of the liability representing the relationship— notwithstanding any difference in the total nominal amounts of the assets representing the corresponding creditor relationships, in the form in which those assets are held or in the manner in which they can be transferred. The amendments made by this paragraph have effect where the date on which the transferee company becomes party to the loan relationship falls on or after 9th April 2003.

In section 727A(1) of the Taxes Act 1988 (accrued income scheme not to apply to transfers of securities under repo agreements), insert at the end “except in a case where section 730A of the Taxes Act 1988 is prevented from applying by subsection (8) of that section.”.

Paragraph 1 has effect in relation to repurchase prices becoming due on or after 9th April 2003. Paragraphs 2 to 19 have effect in relation to agreements to sell securities made on or after 9th April 2003. Paragraph 20 has effect in relation to accounting periods beginning on or after 1st October 2002.

In section 730A(8)(b) of the Taxes Act 1988 (treatment of price differential on sale and repurchase: exclusion of cases where all benefits or risks are for interim holder), for “benefits or risks” substitute “benefits and risks”.

In section 737C(11A) of the Taxes Act 1988 (purposes for which deemed increase of repurchase price has effect), insert at the end “or where that section is prevented from applying by subsection (8) of that section.”.

Paragraph 15 of Schedule 9 to the Finance Act 1996 (c. 8) (repo transactions not related transactions for purposes of loan relationship provisions) is amended as follows. In sub-paragraph (3), after “means” insert “(subject to sub-paragraph (3A))”. Arrangements are not repo or stock-lending arrangements if they are excluded from section 730A of the Taxes Act 1988 by subsection (8) of that section.

The chargeable consideration for a transaction is, except as otherwise expressly provided, any consideration in money or money’s worth given for the subject-matter of the transaction, directly or indirectly, by the purchaser or a person connected with him. Section 839 of the Taxes Act 1988 (connected persons) applies for the purposes of sub-paragraph (1).

For the purposes of this Part consideration attributable— shall be apportioned on a just and reasonable basis. If the consideration is not so apportioned, this Part has effect as if it had been so apportioned. For the purposes of this paragraph any consideration given for what is in substance one bargain shall be treated as attributable to all the elements of the bargain, even though—

Except as otherwise expressly provided, the value of any chargeable consideration for a land transaction, other than— shall be taken to be its market value at the effective date of the transaction.

Where the whole or part of the consideration for a land transaction consists of the carrying out of works of construction, improvement or repair of a building or other works to enhance the value of land, then— The conditions referred to in sub-paragraph (1) are— In this paragraph— Section 839 of the Taxes Act 1988 (connected persons) has effect for the purposes of this paragraph.

In the case of the grant of a lease none of the following counts as chargeable consideration— Where sub-paragraph (1) applies in relation to an obligation, a payment made in discharge of the obligation does not count as chargeable consideration. The assumption or (as the case may be) release of any such obligation as is mentioned in sub-paragraph (1) does not count as chargeable consideration in relation to the assignment or surrender of the lease.

Where the purchaser agrees to indemnify the vendor in respect of liability to a third party arising from breach of an obligation owed by the vendor in relation to the land that is the subject of the transaction, neither the agreement nor any payment made in pursuance of it counts as chargeable consideration.

A land transaction is exempt from charge if the purchaser is a charity and the following conditions are met. Relief under this paragraph is referred to in this Part as “charities relief”. The first condition is that the purchaser must intend to hold the subject-matter of the transaction for qualifying charitable purposes, that is— The second condition is that the transaction must not have not been entered into for the purpose of avoiding tax under this Part (whether by the purchaser or any other person). In this paragraph a “charity” means a body or trust established for charitable purposes only.

This paragraph applies where— The conditions are as follows— An election for tax to be charged in accordance with this paragraph must be included in the land transaction return made in respect of the grant of the lease, or in an amendment of that return, and is irrevocable, so that the return may not be amended so as to withdraw the election. Where this paragraph applies the chargeable consideration for the grant of the lease shall be taken to be the amount stated in the lease in accordance with sub-paragraph (2)(e)(i) or (ii). As to the tax treatment of the acquisition of the reversion in pursuance of the lease, see paragraph 3. Section 118 (meaning of “market value”) does not apply in relation to the reference in sub-paragraph (2)(e) above to the market value of the dwelling.

This paragraph has effect for the purposes of paragraphs 2 and 4 (shared ownership leases: election as to basis of taxation). A “qualifying body” means— A lease is granted “in pursuance of the preserved right to buy” if—

A purchaser who is required to deliver a land transaction return must— The records must be preserved for six years after the effective date of the transaction and until any later date on which— The records required to be kept and preserved under this paragraph include—

If the Inland Revenue give notice of enquiry into a land transaction return, they may by notice in writing require the purchaser— as they may reasonably require for the purposes of the enquiry. A notice under this paragraph (which may be given at the same time as the notice of enquiry) must specify the time (which must not be less than 30 days) within which the purchaser is to comply with it. In complying with a notice under this paragraph copies of documents may be produced instead of originals, but— A notice under paragraph (b) must specify the time (which must not be less than 30 days) within which the purchaser is to comply with it. The Inland Revenue may take copies of, or make extracts from, any documents produced to them under this paragraph. A notice under this paragraph does not oblige a purchaser to produce documents or provide information relating to the conduct of—

If at a time when an enquiry is in progress into a land transaction return the Inland Revenue form the opinion— they may by notice in writing to the purchaser amend the assessment to make good the deficiency. In the case of an enquiry that under paragraph 13(2) is limited to matters arising from an amendment of the return, sub-paragraph (1) above applies only so far as the deficiency is attributable to the amendment. For the purposes of this paragraph the period during which an enquiry is in progress is the whole of the period—

The Inland Revenue or the purchaser may withdraw a notice of referral under paragraph 19 by notice in accordance with this paragraph. Notice of withdrawal must be given—

An enquiry under paragraph 12 is completed when the Inland Revenue by notice (a “closure notice”) inform the purchaser that they have completed their enquiries and state their conclusions. A closure notice must either— A closure notice takes effect when it is issued.

A Revenue determination has effect for enforcement purposes as if were a self-assessment by the purchaser. In sub-paragraph (1) “for enforcement purposes” means for the purposes of the following provisions of this Part of this Act— Nothing in this paragraph affects any liability of the purchaser to a penalty for failure to deliver a return.