Finance Act 2013
Income tax is charged for the tax year 2013-14.
For the tax year 2013-14 the amount specified in section 35(1) of ITA 2007 (personal allowance for those born after 5 April 1948) is replaced with “ £9,440 ”.
Accordingly section 57 of that Act (indexation of allowances), so far as relating to the amount specified in section 35(1) of that Act, does not apply for that tax year.
For the tax year 2013-14 the amount specified in section 10(5) of ITA 2007 (basic rate limit) is replaced with “ £32,010 ”.
Accordingly section 21 of that Act (indexation of limits), so far as relating to the basic rate limit, does not apply for that tax year.
Corporation tax is charged for the financial year 2014.
For that year the rate of corporation tax is—
21% on profits of companies other than ring fence profits, and
30% on ring fence profits of companies.
In subsection (2) “ring fence profits” has the same meaning as in Part 8 of CTA 2010 (see section 276 of that Act).
For the financial year 2013 the small profits rate is—
20% on profits of companies other than ring fence profits, and
19% on ring fence profits of companies.
For the purposes of Part 3 of CTA 2010, for that year—
the standard fraction is 3/400ths, and
the ring fence fraction is 11/400ths.
In subsection (1) “ring fence profits” has the same meaning as in Part 8 of that Act (see section 276 of that Act).
For the financial year 2015 the main rate of corporation tax is 20% ....
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In relation to expenditure incurred during the period beginning with 1 January 2013 and ending with the specified date , section 51A of CAA 2001 (entitlement to annual investment allowance) has effect as if in subsection (5) for “£25,000” there were substituted “ £250,000 ”.
Schedule 1 contains provision about chargeable periods which straddle 1 January 2013 ....
The specified date is —
for the purposes of corporation tax, 31 March 2014, and
for the purposes of income tax, 5 April 2014.
An accredited competitor who performs an Anniversary Games activity is not liable to income tax in respect of any income arising from the activity if the non-residence condition is met.
The following are Anniversary Games activities—
competing at the Anniversary Games, and
any activity that is performed during the games period the main purpose of which is to support or promote the Anniversary Games.
The non-residence condition is that—
the accredited competitor is non-UK resident for the tax year 2013-14, or
the accredited competitor is UK resident for the tax year 2013-14 but the year is a split year as respects the competitor and the activity is performed in the overseas part of the year.
Section 966 of ITA 2007 (deduction of sums representing income tax) does not apply to any payment or transfer which gives rise to income benefiting from the exemption under subsection (1).
In this section—
In sub-paragraph (2)(a)(i) the reference to the issued share capital of the company does not include any capital already held by the person making the offer or a person connected with that person and in sub-paragraph (2)(a)(ii) the reference to the shares in the company does not include any shares already held by the person making the offer or a person connected with that person. For the purposes of sub-paragraph (2)(a)(i) and (ii) it does not matter if the general offer is made to different shareholders by different means. The amendment made by this paragraph comes into force on such day as the Treasury may by order appoint.
Part 8 of Schedule 2 to ITEPA 2003 (cash dividends and dividend shares) is amended as follows.
Chapter 4 (trade profits: rules restricting deductions) is amended as follows.
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Section 212B (circumstances where Chapter 16A applies) is amended as follows. In subsection (1)— In subsection (3) for “trade” substitute “ activity ”.
After section 32 insert—
Section 212C (when there is a a qualifying change in relation to C) is amended as follows. In subsection (4)— In subsection (5) for “trade” (in both places) substitute “ activity ”.
After section 33 insert—
Section 212I (relevant percentage share) is amended as follows. In subsections (1) and (3) for “trade” substitute “ activity ”. In subsection (2) for “a trade” substitute “ an activity ”.
In section 38 (restriction of deductions in respect of employee benefit contributions), after subsection (2) insert—
In section 212J(1) (relevant excess of allowances) for “trade” substitute “ activity ”.
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In section 212K(2), (3), (4) and (5) (relevant tax written-down value) for “trade” substitute “ activity ”.
Section 55A (expenditure on integral features) is amended as follows. The existing provision becomes subsection (1). After that subsection insert—
In section 212N(2), (3) and (4) (old and new accounting periods) for “trade” substitute “ activity ”.
Section 212P (effect of excess on pools) is amended as follows. In subsection (3)— In subsection (4)—
Section 212Q (when there are postponed capital allowances) is amended as follows. In subsection (3)— In subsection (4)—
“GAAR procedural requirements” means the procedural requirements of Schedule 43, 43A , 43B, or (as the case may be) 43D,
Part 6 of Schedule 3 (requirements etc relating to share options) is amended as follows.
In section 30 of FA 2005 (qualifying trust gains: special capital gains tax treatment), in subsection (1), for paragraph (c) substitute—. The amendment made by this paragraph has effect in relation to the tax year 2013-14 and any subsequent tax year.
In consequence of paragraph 7, paragraph 10 of Schedule 10 to the Finance (No. 3) Act 2010 is repealed.
In paragraph 27 (introduction) in sub-paragraph (1)—
omit the entry for paragraph 31,
after the entry for paragraph 32 insert “ and ”, and
omit the entry for paragraph 33 and the “and” after it.
In paragraph 30 (time for exercising options) in sub-paragraph (2)(a)—
for “32 to” substitute “ 32, ”, and
omit “reaching the specified age without retiring,”.
Omit paragraph 31 (requirement to have a “specified age”).
Omit paragraph 33 (exercise of options: reaching specified age without retiring).
In paragraph 34 (exercise of options: scheme-related employment ends) in sub-paragraph (2)(b) omit the words from “on” to “employment”.
In Part 9 of Schedule 3 (supplementary provisions) in paragraph 49 (index of defined expressions) omit the entry for “specified age”.
“relevant agreement” has the meaning given by section 104(5)(a) of FA 1991.
The amendment made by paragraph 11 above has no effect in relation to options granted before the day on which this Act is passed; and the effect of the amendments made by paragraphs 8 to 10 and 13 above is limited accordingly.
Paragraph 68 (reinvestment: amounts to be carried forward) is amended as follows. In sub-paragraph (4)— Omit sub-paragraph (6). The amendments made by this paragraph have effect in relation to amounts held by trustees on or after 6 April 2013 (including amounts originally retained before that date in relation to which an event falling within paragraph 68(4)(a) to (c) of Schedule 2 to ITEPA 2003 did not occur before that date). A SIP approved before 6 April 2013 has effect accordingly with the omission of any provision falling within a provision of Schedule 2 to ITEPA 2003 omitted by this paragraph.
The amendments made by paragraphs 1 to 4 above have effect in relation to disposals of shares on or after 6 April 2013. In the case of the amendments made by paragraphs 2 to 4 above, sub-paragraph (1) is subject to paragraph 6(4) below.
Schedule 18 to FA 1998 (company tax returns, assessments and related matters) is amended as follows. In paragraph 1 (meaning of “tax”), after the entry relating to section 455 of CTA 2010 insert— “ section 464A of that Act (tax on other benefit conferred on participator), ”. In paragraph 8(1) (calculation of tax payable), in paragraph 1 of the third step— In paragraph 18 (failure to deliver return: tax-related penalty), for sub-paragraph (4) substitute— The amendments made by this paragraph are treated as having come into force on 20 March 2013.
In Part 3 of FA 1991, omit section 108 (reimbursement by defaulter in respect of certain abandonment expenditure).
In Chapter 16A of Part 2 of ITTOIA 2005 (trading income: oil activities), after section 225U insert—
This paragraph applies where condition A or condition B is met. Condition A is that— Condition B is that— “The relevant filing date” means the date by which the officer believes a return was required to be delivered. The officer may make a determination (an “HMRC determination”) to the best of the officer’s information and belief of the amount of tax to which P is chargeable for the period concerned with respect to the interest. Notice of the determination must be given to P and must state the date on which it is issued. No HMRC determination may be made more than 4 years after the end of the chargeable period to which it relates.
In paragraphs 24 to 27 “taxpayer” means—
in relation to an assessment under paragraph 21, the chargeable person;
in relation to an assessment under paragraph 22, the person mentioned in paragraph 22(1).
This paragraph applies for the purposes of paragraphs 24 and 25. A loss of tax is brought about carelessly by a person if the person fails to take reasonable care to avoid bringing about that loss. Sub-paragraph (4) applies where— Any loss of tax brought about by the inaccuracy is to be treated as having been brought about carelessly by that person. References to a loss of tax brought about deliberately by a person include a loss of tax brought about as a result of a deliberate inaccuracy in a document given to HMRC by or on behalf of that person.
This paragraph applies where— The person may make a claim to the Commissioners for Her Majesty’s Revenue and Customs for the amount to be repaid or discharged. Where this paragraph applies, the Commissioners for Her Majesty’s Revenue and Customs are not liable to give relief, except as provided in this Schedule or by or under any other provision of this Part of this Act. For the purposes of this paragraph and paragraphs 30 to 34, an amount paid by one person on behalf of another is treated as paid by the other person.
This paragraph is about the application of paragraph 29 in a case where either— In such a case, only a relevant person who has been nominated to do so by all of the relevant persons may make a claim under paragraph 29 in respect of the amount in question. The relevant persons are all the persons who would have been liable as responsible partners to pay the amount in question had the payment been due or (in a case falling within sub-paragraph (1)(b)) had the assessment or determination been correctly made.
This paragraph applies in a case where— Notice may be given after the relevant time limit if— HMRC must agree to notice being given after the relevant time limit if the appellant has requested in writing that HMRC do so and HMRC are satisfied— If a request of the kind mentioned in sub-paragraph (3) is made, HMRC must notify the appellant whether or not HMRC agree to the request. In this paragraph “relevant time limit”, in relation to notice of appeal, means the time before which the notice must to be given (disregarding this paragraph).
Sub-paragraphs (2) to (5) apply if HMRC notify the appellant of an offer to review the matter in question. The notification must include a statement of HMRC’s view of the matter in question. If the appellant notifies HMRC within the acceptance period that it accepts the offer, HMRC must review the matter in question in accordance with paragraph 41. If the appellant does not accept the offer in accordance with sub-paragraph (3)— Sub-paragraph (4) does not apply to the matter in question if, or to the extent that, the appellant notifies the appeal to the tribunal. (See paragraph 44 for the circumstances in which the appellant may do so after accepting HMRC’s offer of a review). HMRC may not take the action mentioned in sub-paragraph (1) at any time if before that time— In this paragraph “acceptance period” means the period of 30 days beginning with the date of the document by which HMRC notify the appellant of the offer to review the matter in question.
Where HMRC have notified an appellant under paragraph 39(1)(a) of their view of a matter to which an appeal under paragraph 35 relates, the appellant— Except where sub-paragraph (3) applies, the post-review period is the period of 30 days beginning with the date of the document in which HMRC give notice of the conclusions of the review in accordance with paragraph 41(6). If the period specified in paragraph 41(6) ends without HMRC having given notice of the conclusions of the review, the post-review period is the period that—
In relation to an appeal of which notice has been given under paragraph 36, “settlement agreement” means an agreement between the appellant and an officer of Revenue and Customs that is— Where a settlement agreement is entered into in relation to an appeal, the consequences are to be the same (for all purposes) as if, at the time the agreement was entered into, the tribunal had decided the appeal and had upheld the decision without variation, varied it in that manner or discharged or cancelled it, as the case may be. Sub-paragraph (2) does not apply if, within 30 days from the date when the settlement agreement was entered into, the appellant gives notice in writing to HMRC that it wishes to withdraw from the agreement. Where a settlement agreement is not in writing— Sub-paragraph (6) applies where notice of an appeal has been given under paragraph 36 and— Sub-paragraphs (1) to (4) have effect as if, at the date of the appellant’s notification, the appellant and an officer of Revenue and Customs had agreed (orally or in writing, as the case may be) that the decision under appeal should be upheld without variation. References in this paragraph to an agreement being entered into with an appellant, and to the giving of notice or notification by or to the appellant, include references to an agreement being entered into, or notice or notification being given by or to, a person acting on behalf of the appellant in relation to the appeal.
If the appellant and an officer of Revenue and Customs agree that payment of an amount of tax should be postponed pending the determination of the appeal, the consequences are to be the same (for all purposes) as if the tribunal had, at the time when the agreement was entered into, made a direction to the same effect as the agreement. This is without prejudice to the making of a further agreement or further direction. Where the agreement is not in writing— References in this paragraph to an agreement being entered into with an appellant, and to the giving of notice to or by the appellant, include references to an agreement being entered into, or notice being given to or by, a person acting on behalf of the appellant in relation to the appeal.
On the determination of an appeal under paragraph 35 any tax overpaid must be repaid. On the determination of an appeal under paragraph 35, section 163(payment of tax) has effect in relation to any relevant tax as if— The reference in sub-paragraph (2) to “relevant tax” is to any tax payable in accordance with the determination, so far as it is tax—
In this Schedule “return”, except where the contrary is indicated, means an annual tax on enveloped dwellings return or a return of the adjusted chargeable amount.
11A Annual tax on enveloped dwellings Annual tax on enveloped dwellings return under section 159 of FA 2013 11B Annual tax on enveloped dwellings Return of adjusted chargeable amount under section 160 of FA 2013 That Schedule, as amended by sub-paragraph (1), is taken to have come into force for the purposes of annual tax on enveloped dwellings on the date on which this Act is passed.
In section 318(1) of FA 2004 (disclosure of tax avoidance schemes: interpretation), in the definition of “tax”—
omit the “or” after paragraph (f), and
after paragraph (g) insert , or
A SIP, SAYE option scheme or CSOP scheme approved before the day on which this Act is passed has effect with any modifications needed to reflect the amendments made by this Part of this Schedule. In relation to any shares awarded under a SIP before that day which are subject to provision for forfeiture, that provision has effect with any modifications needed to reflect the amendment made by paragraph 3 above. Because of paragraphs 48 and 58 below, that amendment is not relevant to shares awarded under a SIP on or after that day.
This paragraph applies if, during the tax year 2012-13, an individual acquires shares of a class in a company (“the relevant shares”) which would be relevant EMI shares were the reference to 6 April 2013 in section 169I(7D)(a) of TCGA 1992 (as inserted by paragraph 1 above) a reference to 6 April 2012 instead. If the individual makes no disposals of shares of that class in that company during that tax year, the relevant shares are to be treated as if they were relevant EMI shares. If the individual disposes of shares of that class in that company during that tax year, the individual may elect for the relevant shares to be treated as if they were relevant EMI shares. If the individual makes an election under sub-paragraph (3)— In section 106A of TCGA 1992 after subsection (6) insert— An election under sub-paragraph (3) may not be made or revoked after 31 January 2014 (and paragraph 3(1)(b) of Schedule 1A to TMA 1970 does not apply in relation to such an election). For the purposes of this paragraph shares in a company are not to be treated as being of the same class unless they are so treated by the practice of a recognised stock exchange or would be so treated if dealt with on a recognised stock exchange. “Recognised stock exchange” has the meaning given by section 1005 of ITA 2007.
In Part 2 of ITTOIA 2005, omit section 225T (reimbursement by defaulter in respect of certain abandonment expenditure).
In Part 8 of CTA 2010, omit section 298 (reimbursement by defaulter in respect of certain abandonment expenditure).
Section 7
...
Part 7 of ITEPA 2003 (employment income: income and exemptions relating to securities) is amended as follows.
After Chapter 6 insert—
In Chapter 10 (trade profits: certain telecommunication rights), before section 145 insert—
In Chapter 11A (trade profits: changes in trading stock), after section 172A insert—
In Chapter 16 (averaging profits of farmers and creative artists), after section 221 insert—
Chapter 17 (adjustment income) is amended as follows.
In Chapter 1 of Part 7 of ITTOIA 2005 (rent-a-room relief), in section 786 (meaning of “rent-a-room receipts”), after subsection (4) insert—
After section 47 of TCGA 1992 insert—
Part 4 of ITTOIA 2005 (savings and investment income) is amended in accordance with paragraphs 2 and 3.
ITTOIA 2005 is amended as follows. Omit Chapter 12 of Part 4 (disposals of futures and options involving guaranteed returns). In section 687(2) (application of charge to tax), at the end insert “ or to income falling within Chapter 2A of Part 4 ”. In Schedule 1 (consequential amendments), omit paragraph 435. In Schedule 2 (transitionals and savings), omit paragraph 95. In Schedule 4 (abbreviations and defined expressions), omit the entry for “future (in Chapter 12 of Part 4)”.
In Schedule 1 of CTA 2010 (minor and consequential amendments), omit paragraphs 540 to 543 and 544(a), (c) and (d).
The amendments made by this Schedule have effect in relation to changes in ownership that occur on or after 20 March 2013.
Chapter 9 of Part 13 of CTA 2010 (community amateur sports clubs) is amended as follows.
In section 658 (meaning of “community amateur sports club”), in subsection (1A)(c), for “section 661” substitute “ sections 660A and 661 ”.
Any power conferred on the Treasury under or by virtue of this Schedule to make regulations or an order comes into force on the day on which this Act is passed (and may be exercised to make provision having effect in relation to times before this Act is passed). So far as not already brought into force by virtue of sub-paragraph (1), the amendments made by this Schedule come into force in accordance with provision contained in an order made by the Treasury. An order made under sub-paragraph (2) may—
CTA 2009 is amended as follows.
The Commissioners for Her Majesty’s Revenue and Customs may by regulations make provision about— Regulations under sub-paragraph (1) may make different provision for different purposes. Every return must include a declaration by the person making it to the effect that the return is correct and complete to the best of the person’s knowledge. A return is treated as containing any information provided by the person making the return for the purpose of completing the return.
A person who fails to comply with paragraph 5 in relation to a chargeable period is liable to a penalty not exceeding £3,000, subject to the following exception. No penalty is incurred if an officer of Revenue and Customs is satisfied that any facts that it is reasonable to require should be proved to HMRC, and that would have been proved by the records, are proved by other documentary evidence provided to them.
An appeal may be brought against— If an appeal under sub-paragraph (1)(a) against an amendment of a self assessment is made while an enquiry is in progress none of the steps mentioned in paragraph 38(2)(a) to (c) may be taken in relation to the appeal until the enquiry is completed.
This paragraph applies if notice of appeal has been given to HMRC. In such a case— If the appellant notifies the appeal to the tribunal, the tribunal is to determine the matter in question. See paragraphs 43 and 44 for provision about the circumstances in which an appeal may be notified to the tribunal after a review has been required by the appellant or offered by HMRC. This paragraph does not prevent the matter in question from being dealt with in accordance with paragraph 46(1) and (2) (settling of appeals by agreement).
This paragraph applies if HMRC are required by paragraph 39 or 40 to review the matter in question. The nature and extent of the review are to be such as appear appropriate to HMRC in the circumstances. For the purpose of sub-paragraph (2), HMRC must, in particular, have regard to steps taken before the beginning of the review— The review must take account of any representations made by the appellant at a stage which gives HMRC a reasonable opportunity to consider them. The review may conclude that HMRC’s view of the matter in question is to be— HMRC must notify the appellant of the conclusions of the review and their reasoning within— In sub-paragraph (6) “relevant day” means— If HMRC do not give notice of the conclusions of the review within the period specified in sub-paragraph (6), the review is treated as having concluded that HMRC’s view of the matter in question is upheld. If sub-paragraph (8) applies, HMRC must notify the appellant of the conclusions which the review is treated as having reached.
Where HMRC have offered to review the matter to which a notice of an appeal under paragraph 35 relates, the right of the appellant at any time to notify the appeal to the tribunal depends on whether or not the appellant has accepted the offer at that time. If the appellant has accepted the offer, the appellant— If the appellant has not accepted the offer, the appellant— In this paragraph—
Where there is an appeal under paragraph 35, the tax charged by the amendment or assessment in question remains due and payable as if there had been no appeal. Sub-paragraph (1) is subject to paragraphs 48 and 49.
This paragraph applies where an appeal under paragraph 35(1) has been notified to the tribunal. If the tribunal decides that the appellant is overcharged by a self assessment or any other assessment, the assessment must be reduced accordingly. If the tribunal does not so decide, the assessment is to stand good. If it appears to the tribunal that the appellant is undercharged to tax by a self assessment or any other assessment, the assessment must be increased accordingly.
Where a party to an appeal to the tribunal under paragraph 35 makes a further appeal, tax is to be payable or repayable in accordance with the determination of the tribunal or court (as the case may be), even though the further appeal is pending. But if the amount charged by the assessment is altered by the order or judgment of the Upper Tribunal or court, then—
In relation to a return delivered by the responsible partners for a partnership, anything required or authorised under section 159 or 160 or this Schedule to be done by the responsible partners is required or authorised to be done by all the responsible partners.
In section 1(1) of the Provisional Collection of Taxes Act 1968 (temporary statutory effect of House of Commons resolutions), after “stamp duty land tax,” insert “annual tax on enveloped dwellings,”.
Subject to sub-paragraph (2), the amendments made by this Schedule have effect in relation to transfers of value made, or treated as made, on or after the day on which this Act is passed. Section 162B of IHTA 1984 (inserted by paragraph 3) only has effect in relation to liabilities incurred on or after 6 April 2013. For the purposes of sub-paragraph (2), where a liability is incurred under an agreement—
Schedule 17A is amended as follows. Where a lease (“the actual lease”) is subsequently granted in pursuance of the agreement, the notional lease is to be treated for the purposes of this Part as if it were a lease granted— Where sub-paragraph (3) applies the grant of the actual lease is disregarded for the purposes of this Part except section 81A (return or further return in consequence of later linked transaction). For the purposes of section 81A— In paragraph 19 (missives of let)— Accordingly, in Schedule 25 to FA 2006, paragraphs 4 and 5 are omitted.
Schedule 6 to FA 2000 (climate change levy) is amended as follows.
A designated HMRC officer who has received a notice or notices under paragraph 11 must, having considered any opinion of the GAAR Advisory Panel about the tax arrangements, give the taxpayer a written notice setting out whether the tax advantage arising from the arrangements is to be counteracted under the general anti-abuse rule. If the notice states that a tax advantage is to be counteracted, it must also set out—
FA 2005 is amended as follows.
This Part of this Schedule defines some key concepts for the purposes of this Schedule.
A person’s home could be a building or part of a building or, for example, a vehicle, vessel or structure of any kind. Whether, for a given building, vehicle, vessel, structure or the like, there is a sufficient degree of permanence or stability about P’s arrangements there for the place to count as P’s home (or one of P’s homes) will depend on all the circumstances of the case. But somewhere that P uses periodically as nothing more than a holiday home or temporary retreat (or something similar) does not count as a home of P’s. A place may count as a home of P’s whether or not P holds any estate or interest in it (and references to “having” a home are to be read accordingly). Somewhere that was P’s home does not continue to count as such merely because P continues to hold an estate or interest in it after P has moved out (for example, if P is in the process of selling it or has let or sub-let it, having set up home elsewhere).
This paragraph applies in calculating the “reference period” (which is a step taken in determining whether P works “sufficient hours in the UK” or “sufficient hours overseas” as assessed over a given period of days). The number of days in the given period may be reduced to take account of— But no reduction may be made in respect of any day that is a “disregarded day” (see paragraphs 9(2) and 14(3) in Part 1 of this Schedule). For any particular employment or trade, “reasonable” amounts of annual leave or parenting leave are to be assessed having regard to (among other things)— Non-working days are “embedded within” a block of leave only if there are, as part of that block of leave— A “non-working day” is any day of the week, month or year on which P— In calculating the reductions to be made under sub-paragraph (2)— If— the number of days in the given period may be reduced by the number of days in that gap. But—
What counts as a “UK tie” depends on whether P was resident in the UK for one or more of the 3 tax years preceding year X. If P was resident in the UK for one or more of those 3 tax years, each of the following types of tie counts as a UK tie— Otherwise, each of the following types of tie counts as a UK tie— In order to have the requisite number of UK ties for year X, each tie of P’s must be of a different type.
P has a 90-day tie for year X if P has spent more than 90 days in the UK in—
the tax year preceding year X,
the tax year preceding that tax year, or
each of those tax years separately.
Section 288 of TCGA 1992 (interpretation) is amended as follows. In subsection (1), insert the following definition in the appropriate place—. After subsection (1ZA) insert—
In Schedule 24 to FA 2007 (penalties for errors), paragraph 13 (procedure: assessment) is amended as follows. In sub-paragraph (1)(c), after “assessed” insert “(subject to sub-paragraph (1ZB))”. Sub-paragraph (1ZB) applies where— A notice under sub-paragraph (1) in respect of any of the relevant penalties may, instead of stating the tax period in respect of which the penalty is assessed, state the tax year or the part of a tax year to which the penalty relates. For that purpose, a relevant penalty relates to the tax year or the part of a tax year in which the relevant tax periods fall. For the purposes of sub-paragraph (1ZA)—
Paragraph 7 of Schedule 41 to FA 2008 (potential lost revenue in respect of failure to comply with relevant obligation) is amended as follows. In the case of an obligation under section 7 of TMA 1970 which arises by virtue of subsection (1B) of that section, the potential lost revenue is so much of any income tax or capital gains tax to which P is liable in respect of the tax year in question as is, by reason of the failure to comply with the obligation— For the purposes of sub-paragraph (1A) the relevant date is— In sub-paragraph (2), after “and a tax year” insert “(not falling within sub-paragraph (1A))”.
After section 227 insert—
In section 365(1) (overview of Part 4)—
after paragraph (a) insert—, and
omit paragraph (k).
After section 660 insert—
In a case where a club that was registered as a community amateur sports club before the day on which this Act is passed ceases to be entitled to be registered as such by virtue of this Schedule, an officer of Revenue and Customs may not cancel the club's registration with effect from a date earlier than that day. But sub-paragraph (1) does not prevent the cancellation of the club's registration if the officer is satisfied that—
In section 63 (tenants occupying land for purposes of trade treated as incurring expenses) after subsection (5) insert—
In this Part of this Act—
references to the delivery of an annual tax on enveloped dwellings return are to the delivery of a return that complies with all requirements imposed by or under any of sections 159 and 161 and paragraph 1;
references to the delivery of a return of the adjusted chargeable amount are to the delivery of a return that complies with all requirements imposed by or under any of sections 160 and 161 and paragraph 1.
In paragraph 4 (definition of “taxable supply”) in sub-paragraph (2)(b) after “24” insert “, 24A, 24B, 24C, 42D”.
Section 34 (disabled persons) is amended as follows. In subsection (2), for paragraph (b) substitute— For subsection (3) substitute—
the overseas part section 989 of ITA 2007 split year section 989 of ITA 2007 the UK part section 989 of ITA 2007
After section 239 insert—
After Chapter 2 insert—
In section 232 (tenants under taxed leases treated as incurring expenses) after subsection (4) insert—
Levy is chargeable on a supply of electricity if—
Section 35 (relevant minors) is amended as follows. For subsection (3)(c)(ii) substitute— For subsection (4) substitute—
the overseas part section 989 of ITA 2007 split year section 989 of ITA 2007 the UK part section 989 of ITA 2007
The amendments made by paragraphs 6 and 7 above have effect in relation to leases granted on or after 1 April 2013.
In paragraph 6 (supplies of gas) in sub-paragraph (2A) after “24” insert “, 24A, 24B, 24C, 42D”.
For section 38 substitute—
In section 989 of ITA 2007 (definitions for purposes of Income Tax Acts), insert the following definitions in the appropriate places—, , and .
Paragraph 14 (exemption for supplies to electricity producers) is amended as follows. In sub-paragraphs (2)(b) and (3)(b) after “electricity” insert “in a small generating station”. Sub-paragraph (1) does not exempt a supply where the person to whom the supply is made— Paragraph 24A makes provision under which carbon price support rate commodities intended to be used in a generating station may be the subject of a deemed taxable supply (and, accordingly, this paragraph needs to be read subject to that paragraph). Omit sub-paragraphs (4) and (5).
The amendments made by paragraphs 15 to 17 have effect for the tax year 2013-14 and subsequent tax years.
the overseas part section 989 split year section 989 the UK part section 989
Paragraph 24B makes provision under which carbon price support rate commodities intended to be used in a combined heat and power station may be the subject of a deemed taxable supply (and, accordingly, this paragraph needs to be read subject to that paragraph).
After Schedule 1 insert—
Paragraph 17 (exemption: self-supplies by electricity producers) is amended as follows. The supply is exempt from levy if it is a supply of electricity produced in— Sub-paragraph (1A)(d) applies only if the producer is— In sub-paragraph (2) for the words from “If” to “unless—” substitute “This paragraph does not exempt the supply if—”. Omit sub-paragraphs (3) and (4).
In sub-paragraph (2)(b) “taxable supply” does not include a deemed supply under paragraph 24A, 24B, 24C or 42D.
In Part 2 after paragraph 24 insert—
After paragraph 38 insert—
Paragraph 39 (regulations as to time of supply) is amended as follows. In sub-paragraph (1)(c) after “24” insert “, 24A, 24B, 24C, 42D”. In sub-paragraph (3) after “supply)” insert “and 38A”.
Sub-paragraph (1) does not apply to a deemed supply under paragraph 24A or 24B.
After paragraph 42 insert—
In paragraph 55 (notification of registrability) in sub-paragraph (1) after paragraph (a) insert—.
In paragraph 62 (tax credits) in sub-paragraph (1) after paragraph (b) insert—.
In paragraph 146 (regulations) in sub-paragraph (3)—
for “14(3),” substitute “5(2A), 14(2),”, and
after “16,” insert “17(1B),”.
In paragraph 147 (definitions)—
at the appropriate places, insert—, , , , , and , and
in the definition of “prescribed”—
for “14(3),” substitute “5(2A), 14(2),”, and
after “16(3)” insert “, 17(1B)”.
After paragraph 152 insert—
Regulation 5 of the Climate Change Levy (Electricity and Gas) Regulations 2001 (S.I. 2001/1136) is amended as follows. In paragraph (1) for “paragraph 14(2) of the Act (exemption: certain supplies to electricity producers)” substitute “paragraphs 5(2A), 14(2) and 17(1B) of the Act (which contain references to exempt unlicensed electricity suppliers)”. In paragraph (2)(a) for “14(4)” substitute “152A(1)”. The amendments made by this paragraph are to be treated as having been made by the Treasury under the powers to make regulations conferred by paragraphs 5(2A), 14(2) and 17(1B) of Schedule 6 to FA 2000.
Section 14
Schedule 2 to ITEPA 2003 is amended as follows.
In Part 6 (partnership shares) paragraph 52 (application of money deducted in accumulation period) is amended as follows. After sub-paragraph (2) insert— In sub-paragraph (3) for “The number of shares awarded to each” substitute “ If the agreement specifies that this sub-paragraph is to apply, the number of shares awarded to the ”. After sub-paragraph (3) insert— In sub-paragraphs (4) and (5) for “and (3)” substitute “ to (3B) ”.
In Part 9 (trustees) in paragraph 75 (duty to give notice of award of shares etc) in sub-paragraph (3) for paragraph (c) substitute—
The amendments made by paragraphs 79 and 80 above have effect in relation to partnership share agreements made on or after the day on which this Act is passed. A trust instrument made before that day has effect with any modifications needed to reflect the amendment made by paragraph 80 above.
Part 9 of Schedule 2 to ITEPA 2003 (trustees) is amended as follows.
In paragraph 70 (introduction) in sub-paragraph (2)—
after the entry for paragraph 77 insert “ and ”, and
omit the entry for paragraph 78.
Omit paragraph 78 (acquisition of shares from employee share ownership trusts). A trust instrument made before the day on which this Act is passed has effect with the omission of any provision falling within a provision of Schedule 2 to ITEPA 2003 omitted by this paragraph.
In section 532 of ITEPA 2003 (modified tax consequences following disqualifying events) in subsection (1)(b) for “40” substitute “ 90 ”. The amendment made by this paragraph has effect in relation to disqualifying events occurring on or after the day on which this Act is passed.
Section 16
Section 17
Subject to paragraph 57, the amendments made by this Schedule have effect for the tax year 2013-14 and subsequent tax years.
In a case where— the profits of the barrister or advocate for that subsequent period of account may be calculated in accordance with that section. The repeal of sections 238 and 239 of ITTOIA 2005 (spreading of adjustment income: barristers and advocates) does not have effect in relation to any individual whose profits for a period of account ending in or before the tax year 2012-13 have been calculated in accordance with section 160 of ITTOIA 2005.
Section 18
Part 2 of ITTOIA 2005 (trading income) is amended as follows.
After Chapter 5 insert—
In section 31 (relationship between rules prohibiting and allowing deductions), in subsection (2), after paragraph (a) insert—.
In Chapter 18 (post-cessation receipts), in section 254 (allowable deductions), after subsection (2A) (inserted by paragraph 39 of Schedule 4) insert—
Part 2 of CAA 2001 (plant and machinery allowances) is amended as follows. In Chapter 3 (qualifying expenditure), after section 38 insert— In Chapter 5 (allowances and charges), in section 59 (unrelieved qualifying expenditure), at the end insert—
The amendments made by this Schedule have effect for the tax year 2013-14 and subsequent tax years.
Section 19
Part 2 of ITEPA 2003 (employment income: charge to tax) is amended as follows.
In section 15 (earnings for year when employee UK resident), as amended by Schedule 45 to this Act, in subsection (5)—
after paragraph (a) omit “and”, and
after paragraph (b) insert, and
In Chapter 5 (taxable earnings: remittance basis rules and rules for non-UK resident employees), after section 41 insert—
Chapter A1 of Part 14 of ITA 2007 (remittance basis) is amended as follows.
In section 809Q (sections 809L and 809P: transfers from mixed funds), after subsection (1) insert—
After section 809R insert—
The amendments made by Part 1 of this Schedule have effect in relation to earnings for the tax year 2013-14 and subsequent tax years.
The amendments made by Part 2 of this Schedule have effect in relation to transfers from a mixed fund that are made in the tax year 2013-14 or any subsequent tax year.
Section 20
Chapter A1 of Part 14 of ITA 2007 (remittance basis) is amended as follows.
In section 809X(3) (exempt property: public access rule), for “sections 809Z and 809Z1)” substitute “ section 809Z) ”.
Section 809Y (property that ceases to be exempt property treated as remitted) is amended as follows. In subsection (2), for “either” substitute “ any ”. After subsection (4) insert— In subsection (6), after “exempt property” insert “ by virtue of the first or second case ”.
After section 809YE insert—
Section 809Z (public access rule: general) is amended as follows. In subsection (1), for “A to D” substitute “ B and C ”. Omit subsection (2). After subsection (8) insert— Omit subsection (10).
Omit section 809Z1 (public access rule: relevant VAT relief).
Section 809Z4 (temporary importation rule) is amended as follows. In subsection (1), after “days” insert “ (subject to any increase under subsection (3B)) ”. In subsection (3)— After that subsection insert— Omit subsections (4) to (10).
In section 809Z6 (exempt property: other interpretation), after subsection (4) insert—
The amendments made by paragraphs 3, 4, 5(4), 7(2), (3)(b) and (c) and (4) and 8 have effect in relation to property that is lost, stolen or destroyed on or after 6 April 2013.
The other amendments made by this Schedule have effect—
in relation to property that is not in the United Kingdom on 6 April 2013, as from that date, and
in relation to property that is in the United Kingdom on that date, as from the time when it ceases to be in the United Kingdom or is lost or stolen.
In the case of property that falls within paragraph 10(b) by virtue of being lost or stolen, any period that is a period of importation in relation to the property for the purposes of section 809Z4 of ITA 2007 ends with the time at which it is lost or stolen.
Section 24
Chapter 9 of Part 4 of ITTOIA 2005 (gains from contracts for life insurance etc) is amended as follows.
In section 476 (special rules: foreign policies) in subsection (2)—
after the entry relating to section 474(3) to (5) insert “ and ”,
omit the entry relating to section 528,
omit the “and” after the entry relating to sections 531 to 534, and
omit the entry relating to section 536(6).
For section 528 substitute—
Omit section 529 (exceptions to section 528).
Section 536 (top slicing relieved liability: one chargeable event) is amended as follows. In subsection (6) for the words from “from” to the end substitute “ reduced under section 528 in the case of the individual. ” For subsection (7) substitute—
In section 552 of ICTA (information: duty of insurers) after subsection (13) insert—
The amendments made by this Schedule have effect in relation to— The amendment made by paragraph 3 above has effect in relation to any insurance or contract made before 6 April 2013 if on or after that date— and the other amendments made by this Schedule have effect in relation to the insurance or contract accordingly. For the purposes of sub-paragraph (2)(a) an exercise of rights conferred by a policy or contract is to count as a variation of the policy or contract. In the case of a policy or contract treated under section 473A of ITTOIA 2005 as a single policy or contract, for the purposes of sub-paragraphs (1) and (2) the date on which the insurance or contract is made is the date on which, as the case may be—
Section 25
Schedule 15 to ICTA (qualifying insurance policies) is amended as follows.
Before Part 1 insert—
At the beginning of Part 1 (qualifying conditions) insert—RULES FOR QUALIFYING POLICIES
Paragraph 17 (substitutions) is amended as follows. In sub-paragraph (2) before paragraph (a) insert—. In sub-paragraph (2)(a) after the first “not” insert “ and paragraph (za) above does not apply ”. In sub-paragraph (4) for “(2)” substitute “ (2)(a) to (c) ”. After sub-paragraph (4) insert—
In paragraph 25 (application of paragraph 17 in cases involving new non-resident policies) after sub-paragraph (2) insert—.
In section 55 of FA 1995 (qualifying life insurance policies: disapplication of paragraph 21 of Schedule 15 to ICTA from appointed date) in subsection (3) after “subject” insert “ to paragraphs A1(2), B2(2) and B3(3) of that Schedule and ”. The amendment made by this paragraph is treated as having come into force on the appointed date (see section 55(9) of FA 1995).
Chapter 9 of Part 4 of ITTOIA 2005 (gains from contracts for life insurance etc) is amended as follows.
After section 463 insert—
In section 485 (disregard of certain events in relation to qualifying policies) after subsection (7) insert—
After section 552ZA of ICTA insert—
In section 552B of ICTA (duties of overseas insurers' tax representatives) in subsection (2)—
after paragraph (b) omit “and”, and
after paragraph (c) insertand .
In section 98 of TMA 1970 (special returns etc), in the second column of the Table, after the entry for regulations under section 552ZA(6) of ICTA insert— “ regulations under section 552ZB; ”.
Section 26
Chapter 2 of Part 13 of ITA 2007 (tax avoidance: transfer of assets abroad) is amended as follows.
Section 718 (meaning of “person abroad” etc) is amended as follows. For subsection (1) substitute— Omit subsection (2)(a).
In section 720 (charge to tax on income treated as arising under section 721) in subsection (7)—
for “742” substitute “ 742A ”, and
after “transaction” insert “ , etc ”.
In section 727 (charge to tax on income treated as arising under section 728) in subsection (5)—
for “742” substitute “ 742A ”, and
after “transaction” insert “ , etc ”.
In section 731 (charge to tax on income treated as arising under section 732) in subsection (4)—
for “742” substitute “ 742A ”, and
after “transaction” insert “ , etc ”.
Section 736 (exemptions: introduction) is amended as follows. In subsection (1) for “742” substitute “ 742A ”. After subsection (2) insert—
After section 742 insert—
In section 751 (the Tribunal's jurisdiction on appeals) after paragraph (d) insert—.
The amendments made by paragraph 2 above have effect in relation to times on or after 6 April 2012. The amendments made by paragraphs 3 to 8 above have effect for the tax year 2012-13 and subsequent tax years.
Section 27
Section 28
Section 33
Section 34
Section 35
In Part 3 of CTA 2009 (trading income), after Chapter 6 insert—
Part 13 of CTA 2009 (additional relief for expenditure on research and development) is amended as follows. After section 1040 (and before the cross-heading “Interpretation”) insert— In section 1138 (meaning of “subsidised expenditure”), in subsection (3), omit the “and” at the end of paragraph (a) and after paragraph (b) insert—
capped R&D expenditure (in Chapter 6A of Part 3) section 104I large company (in Chapter 6A of Part 3) section 1122 (as applied by section 104Y) payment period (in Chapter 6A of Part 3) section 1141 (as applied by section 104Y) qualifying body (in Chapter 6A of Part 3) section 1142 (as applied by section 104Y) qualifying expenditure on sub-contracted R&D (in Chapter 6A of Part 3) section 104C qualifying R&D expenditure (in Chapter 6A of Part 3) section 104A relevant payment to the subject of a clinical trial (in Chapter 6A of Part 3) section 1140 (as applied by section 104Y) relevant research and development (in Chapter 6A of Part 3) section 1042 (as applied by section 104Y) research and development (in Chapter 6A of Part 3) section 1041 (as applied by section 104Y) small or medium-sized enterprise (in Chapter 6A of Part 3) section 1119 (as applied by section 104Y) software or consumable items (in Chapter 6A of Part 3) section 1125 (as applied by section 104Y) staffing costs (in Chapter 6A of Part 3) section 1123 (as applied by section 104Y) subsidised qualifying expenditure (in Chapter 6A of Part 3) section 104F
In section 357CK (deductions that are not routine deductions), in subsection (3)—
in paragraph (a), the words from “for which” to the end become sub-paragraph (i);
after that sub-paragraph insert, or ;
at the beginning of paragraph (b) insert “ where the company obtains an additional deduction as mentioned in paragraph (a)(i), ”.
The amendments made by Parts 1 and 2 of this Schedule have effect in relation to expenditure incurred on or after 1 April 2013.
Subject to paragraph 29, the amendments made by Part 3 of this Schedule have effect in relation to expenditure incurred on or after 1 April 2016.
If a company claims an R&D expenditure credit under section 104A of CTA 2009 for an accounting period beginning before 1 April 2016, the amendments made by Part 3 of this Schedule are treated as having effect in relation to expenditure incurred by the company on or after the first day of that accounting period. But in a case where the accounting period includes 1 April 2013, those amendments are treated as having effect in relation to expenditure incurred by the company on or after that day.
Section 36
After Part 15 of CTA 2009 insert—
Any power conferred on the Secretary of State or the Treasury by virtue of this Schedule to make regulations or an order comes into force on the day on which this Act is passed. So far as not already brought into force by sub-paragraph (1), the amendments made by this Schedule come into force in accordance with provision contained in an order made by the Treasury. An order under sub-paragraph (2)—
The amendments made by this Schedule have effect in relation to accounting periods beginning on or after 1 April 2013. Sub-paragraph (3) applies where a company has an accounting period beginning before 1 April 2013 and ending on or after that date (“the straddling period”). For the purposes of Part 15A of CTA 2009—
Section 36
After Part 15A of CTA 2009 (inserted by Schedule 16 above) insert—
Any power conferred on the Secretary of State or the Treasury by virtue of this Schedule to make regulations or an order comes into force on the day on which this Act is passed. So far as not already brought into force by sub-paragraph (1), the amendments made by this Schedule come into force in accordance with provision contained in an order made by the Treasury. An order under sub-paragraph (2)—
The amendments made by this Schedule have effect in relation to accounting periods beginning on or after the day specified for the purposes of this paragraph in an order made by the Treasury (“the specified day”). An order under sub-paragraph (1) may specify a day earlier than the day on which the order is made or this Act is passed. Sub-paragraph (4) applies where a company has an accounting period beginning before the specified day and ending on or after that day (“the straddling period”). For the purposes of Part 15B of CTA 2009—
The Treasury may by order make such amendments of this Schedule as are necessary for the purpose of complying with any undertakings given to the European Commission, or any conditions imposed by the Commission, in connection with an application for State aid approval. In this paragraph “State aid approval” means approval that the provision made by Part 15B of CTA 2009, to the extent that it constitutes the granting of aid to which any of the provisions of Article 107 or 108 of the Treaty on the Functioning of the European Union applies, is, or would be, compatible with the internal market, within the meaning of Article 107 of that Treaty. An order under this paragraph may— A statutory instrument that contains (whether alone or with other provisions) an order under this paragraph may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, the House of Commons.
Section 36
Section 39
Part 12 of CTA 2010 (real estate investment trusts) is amended as follows.
Section 530 (condition as to distribution of profits) is amended as follows. For subsection (1) substitute— For subsection (4) substitute—
Section 530A (condition as to distribution of profits: increase in profits after delivery of tax return) is amended as follows. In subsection (2) for “530(1)(c)” substitute “ 530(1) ”. In subsection (6) for “530(4)(b)” substitute “ 530(4) ”. After subsection (9) insert—
Section 531 (conditions as to balance of business) is amended as follows. After subsection (4) insert— In subsection (5)(b) after “cash” insert “ or relevant UK REIT shares ”. In subsection (6)(b) after “cash” insert “ and relevant UK REIT shares ”. After subsection (8) insert—
Section 548 (distributions: liability to tax) is amended as follows. In subsection (5) after “2009)” insert “ so far as the distribution is a distribution of exempt profits ”. In subsection (6) after “2005)” insert “ so far as the distribution is a distribution of exempt profits ”. After subsection (8) insert—
Section 549 (distributions: supplementary) is amended as follows. In subsection (2A) after “shareholder” insert “ so far as they are distributions of exempt profits ”. After subsection (3) insert— In subsection (4) after the first “shareholder” insert “ (so far as they are distributions of exempt profits) ”.
After section 549 insert—
In section 550 (attribution of distributions) in subsection (2)—
for paragraph (a) substitute—,
in paragraph (b) for “second” substitute “ third ”,
in paragraph (c) for “third” substitute “ fourth ”,
in paragraph (d) for “fourth” substitute “ fifth ”, and
in paragraph (e) for “fifth” substitute “ sixth ”.
In section 588 (joint ventures: effect of notice under section 586) after subsection (6) insert—
In section 589 (joint ventures: effect of notice under section 587) after subsection (6) insert—
In section 605 (property rental business: exclusion of business producing listed income) after subsection (1) insert—
In Chapter 18 of Part 15 of ITA 2007 (deduction of income tax at source) in sections 973 and 974 (which relate to distributions made by UK REITs) after subsection (6) insert—
The amendments made by paragraph 4(3) to (5) above have effect for accounting periods beginning on or after the day on which this Act is passed. Subject to what follows, the amendments made by paragraphs 5 to 7 above have effect in relation to distributions received on or after the day on which this Act is passed. A distribution received by a member of a group UK REIT does not fall within section 549A(6) or (8) of CTA 2010 if it is received in an accounting period of the principal company of the group beginning before the day on which this Act is passed. A distribution received by a company UK REIT does not fall within section 549A(6) or (8) of CTA 2010 if it is received in an accounting period of the company beginning before the day on which this Act is passed.
Section 42
CTA 2010 is amended in accordance with paragraphs 2 to 4.
In section 1(4) (overview of Act), after paragraph (j) insert—.
After Part 21B insert—
economic loss (in Part 21BA) section 938S economic profit (in Part 21BA) section 938S relevant tax advantage (in Part 21BA) section 938R relevant tax disadvantage (in Part 21BA) section 938R scheme (in Part 21BA) section 938U scheme loss (in Part 21BA) section 938Q the scheme period (in Part 21BA) section 938R scheme profit (in Part 21BA) section 938Q “a tax mismatch scheme (in Part 21BA) section 938P
In section 231(8) of TIOPA 2010 (tax arbitrage: overview), for the words from “section” to the end substitute “ sections 938N and 938V of CTA 2010 (this Part treated as of no effect for the purposes of Parts 21B and 21BA of CTA 2010 (group mismatch and tax mismatch schemes)). ”
The amendments made by this Schedule have effect in relation to schemes entered into at any time (including any time before the commencement date). But section 938O in Part 21BA of CTA 2010 (as inserted by paragraph 3 of this Schedule) does not apply to— In this paragraph “the commencement date” means 5 December 2012.
Section 46
Section 48
This paragraph applies on or after 6 April 2014 in the case of an individual— if notice of intention to rely on it is given to an officer of Revenue and Customs. Chapter 15A of Part 9 of ITEPA 2003 (pension income: lump sums under registered pension schemes) has effect in relation to the individual as if— For the purposes of paragraph 20H of Schedule 36 to FA 2004, the individual’s “protected lump sum and death benefit allowance” is £1,500,000. But this paragraph ceases to apply if the notice under sub-paragraph (1) is given on or after 15 March 2023 and, on or after 6 April 2014— For the purposes of sub-paragraph (3)(a) there is benefit accrual in relation to the individual under an arrangement— For the purposes of sub-paragraphs (4)(b) and (c)(ii) and (11) whether there is an increase in the value of the individual's rights under the arrangement (and its amount if there is) is to be determined— For the purposes of sub-paragraph (5)(b) “the benefits amount” is— where— LS is the lump sum to which the individual would, on the valuation assumptions, be entitled under the arrangement (otherwise than by commutation of pension); P is the annual rate of the pension which would, on the valuation assumptions, be payable to the individual under the arrangement; RVF is the relevant valuation factor. Paragraph 17A of Schedule 36 to FA 2004 (impermissible transfers) applies for the purposes of sub-paragraph (3)(b) but as if the references to a relevant existing arrangement were to the arrangement and the reference in sub-paragraph (2) to 5 April 2006 were to 5 April 2014. Sub-paragraphs (7) to (8B) of paragraph 12 of Schedule 36 to FA 2004 (when there is a permitted transfer) apply for the purposes of sub-paragraph (3)(c); and where there is a permitted transfer— Sub-paragraphs (2A) to (2C) of paragraph 12 of Schedule 36 to FA 2004 (“permitted circumstances”) apply for the purposes of sub-paragraph (3)(d). Paragraph 14 of Schedule 36 to FA 2004 (when a relevant contribution is paid under an arrangement) applies for the purposes of sub-paragraph (4)(a) and (c)(i). Increases in the value of the individual's rights under an arrangement are to be ignored for the purposes of sub-paragraph (4)(b) or (c)(ii) if in no tax year do they exceed the relevant percentage. The relevant percentage, in relation to a tax year, means— In sub-paragraph (12)(a)— In sub-paragraph (12) “the relevant statutory increase percentage”, in relation to a tax year, means the percentage increase in the value of the individual's rights under the arrangement during the tax year so far as it is attributable solely to one or more of the following— Sub-paragraph (16) applies in relation to a tax year if— Sub-paragraph (12)(b)(i) applies as if it referred instead to the annual rate of the increase in the value of the rights during the tax year. For the purposes of sub-paragraph (15)(c) the 12 month period must end during the 12 month period preceding the month in which the increase in the value of the rights occurs. Subject to sub-paragraphs (19) to (21), sub-paragraph (3) applies in relation to an individual who is a relieved member of a relieved non-UK pension scheme as if the relieved non-UK pension scheme were a registered pension scheme; and the other sub-paragraphs of this paragraph apply accordingly. Sub-paragraphs (20) and (21) apply for the purposes of sub-paragraph (3)(a)(instead of sub-paragraph (4)) in determining if there is benefit accrual in relation to an individual under an arrangement under a relieved non-UK pension scheme of which the individual is a relieved member. There is benefit accrual in relation to the individual under the arrangement if there is a pension input amount under sections 230 to 237 of FA 2004 (as applied by Schedule 34 to that Act) greater than nil in respect of the arrangement for a tax year; and, in such a case, the benefit accrual is treated as occurring at the end of the tax year. There is also benefit accrual in relation to the individual under the arrangement if— and, in such a case, the benefit accrual is treated as occurring immediately before the benefit crystallisation event. Expressions used in this paragraph and Part 4 of FA 2004 (pension schemes) have the same meaning in this paragraph as in that Part. In particular, references to a relieved non-UK pension scheme or a relieved member of such a scheme are to be read in accordance with paragraphs 13(3) and (4) and 18 of Schedule 34 to FA 2004 (application of lifetime allowance charge provisions to members of overseas pension schemes).
The Commissioners for Her Majesty's Revenue and Customs may by regulations amend paragraph 1. Regulations under this paragraph may (for example) add to the cases in which paragraph 1 is to apply or is to cease to apply. Regulations under this paragraph may include provision having effect in relation to a time before the regulations are made; but—
The Commissioners for Her Majesty's Revenue and Customs may by regulations make provision specifying how any notice required to be given to an officer of Revenue and Customs under paragraph 1 is to be given. In sub-paragraph (1) the reference to paragraph 1 is to that paragraph as amended from time to time by regulations under paragraph 2.
Regulations under paragraph 2 or 3 may include supplementary or incidental provision. The powers to make regulations under paragraphs 2 and 3 are exercisable by statutory instrument. A statutory instrument containing regulations under paragraph 2 or 3 is subject to annulment in pursuance of a resolution of the House of Commons.
Part 4 of FA 2004 (pension schemes) is amended as follows.
Section 218 (standard lifetime allowance etc) is amended as follows. After subsection (5B) insert— After subsection (5C) insert— The amendments made by this paragraph have effect for the tax year 2014-15 and subsequent tax years.
In section 219 (availability of individual's lifetime allowance) after subsection (5) insert— The amendment made by this paragraph has effect for cases in which the time of the current benefit crystallisation event falls on or after 6 April 2014.
Part 1 of Schedule 29 (authorised lump sums: lump sum rule) is amended as follows. In paragraph 2 (which applies for the purpose of determining pension commencement lump sums) after sub-paragraph (8) insert— The amendment made by sub-paragraph (2) has effect for cases in which the member becomes entitled to the lump sum on or after 6 April 2014. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . The amendment made by sub-paragraph (4) has effect for cases in which the nominated date falls on or after 6 April 2014.
Section 55
ITEPA 2003 is amended in accordance with paragraphs 2 to 15.
In section 19(2) (time of receipt of non-money earnings), at the appropriate place insert— “ section 226A (amount treated as earnings: employee shareholder shares). ”
In Chapter 12 of Part 3, after section 226 insert—
In consequence of the amendment made by paragraph 3—
in the heading to Chapter 12 of Part 3, for “Payments” substitute “ Other amounts ”, and
before section 221 insert the heading “Payments”.
In section 428 (restricted securities: amount of charge on occurrence of chargeable event), in subsection (7), after paragraph (b) insert—.
In section 431 (election for full or partial disapplication of Chapter 2 (restricted securities)), in subsection (3), after paragraph (a) insert—.
In section 437 (convertible securities: adjustment of charge), in subsection (1)(a), after “charge)” insert “ , section 226A (employee shareholder shares: amount treated as earnings) ”.
In section 446B (charge on acquisition of securities with artificially depressed market value), in subsection (4), after paragraph (b) insert—.
In section 446T (securities acquired for less than market value: amount of notional loan), in subsection (3), after paragraph (b) insert—.
In section 446V (Chapter 3C to be additional to other income tax charges), after paragraph (b) insert—.
In section 452 (shares in research institution spin-out companies: market value on acquisition), in subsection (2), after paragraph (a) insert—.
In section 479 (securities options: amount of gain realised on chargeable event), after subsection (3) insert—
In section 531 (enterprise management incentives: limitation of charge where shares acquired below market value), after subsection (3) insert—
Section 532 (enterprise management incentives: consequences after disqualifying events) is amended as follows. After subsection (4) insert— In subsection (5), for “those subsections” substitute “ subsections (2) and (3) ”.
In section 554N (exclusions: other cases involving employment-related securities etc), in subsection (7)(b), after “Part 3” insert “ , or an amount treated under section 226A as earnings of A, ”.
In Chapter 3 of Part 4 of ITTOIA 2005 (tax on dividends etc from UK companies), after section 385 insert—
TCGA 1992 is amended as follows.
In section 58(2) (spouses and civil partners: disposals excepted from the usual rule)—
omit “or” at the end of paragraph (a), and
after paragraph (b) insert, or .
Section 149AA (restricted and convertible employment-related securities) is amended as follows. In subsection (1) for “Where” substitute “ Subject to subsection (1A), where ”. After that subsection insert— In subsection (2)— After subsection (6) insert— In subsection (7)— Accordingly, in the heading for that section, after “securities” insert “ and employee shareholder shares ”.
After section 236A insert—
CTA 2009 is amended as follows.
“employee shareholder share” has the meaning given by section 226A(6) of ITEPA 2003,
Section 1009 (relief for employee share acquisitions: employee's tax position) is amended as follows. In subsection (2)(a), for “earnings within Chapter 1 of Part 3 of ITEPA 2003” substitute “ relevant earnings ”. After subsection (2) insert— After subsection (5) insert—
In section 1010(1) (acquisition of shares: relief if shares neither restricted nor convertible), after “section 1012” insert “ and, in the case of employee shareholder shares, section 1038B ”.
Section 1011 (acquisition of shares: relief if shares are restricted or convertible) is amended as follows. In subsections (2) and (3), for “earnings of the employee within Chapter 1 of Part 3 of ITEPA 2003” substitute “ relevant earnings of the employee ”. For subsection (4) substitute—
In section 1018(1) (acquisition of shares pursuant to option: relief if shares neither restricted nor convertible), after “section 1020” insert “ and, in the case of employee shareholder shares, section 1038B ”.
In section 1019(1) (acquisition of shares pursuant to option: relief if shares are restricted or convertible), after “section 1020” insert “ and, in the case of employee shareholder shares, section 1038B ”.
In section 1022 (takeover of company whose shares are subject to option), after subsection (4) insert—
In section 1026 (restricted shares: relief available on chargeable event), after subsection (4) insert—
In section 1027 (restricted shares: relief available on death of employee), after subsection (4) insert—
In section 1033 (convertible securities: relief available on chargeable event), after subsection (4) insert—
In section 1034 (convertible securities: relief available following death of employee), after subsection (4) insert—
At the end of Chapter 6 of Part 12 insert— Accordingly, in the heading for that Chapter, at the end insert “ ETC ”.
In section 1292 (provision of qualifying benefits), after subsection (6) insert—
In section 1293 (timing and amount of certain qualifying benefits), after subsection (5) insert—
employee shareholder share (in Part 12) section 226A(6) of ITEPA 2003 (see section 1005 of this Act)
In Chapter 11 of Part 4 of ITEPA (employment income: miscellaneous exemptions), after section 326A insert—
The amendments made by this Schedule come into force in accordance with provision made by the Treasury by order made by statutory instrument.
Section 64
Section 65
TCGA 1992 is amended as follows.
Section 1 (the charge to tax) is amended as follows. In subsection (2), after “Acts” insert “ , subject to the exception in subsection (2A) ”. After subsection (2) insert— In subsection (3) for “subsection (2)” substitute “ subsections (2) and (2A) ”.
In section 2 (persons and gains chargeable to capital gains tax, and allowable losses), after subsection (7) insert—
After section 2 insert—
In section 4 (rates of capital gains tax), after subsection (3) insert—
In section 8 (company's total profits to include chargeable gains), after subsection (4) insert—
In section 13 (attribution of gains to members of non-resident companies), after subsection (1) insert—
In section 16 (computation of losses), in subsection (3) after “section” insert “ 2B, ”.
In Part 2, after Chapter 4 insert—
After section 100 insert—
Section 161 (appropriations to and from stock) is amended as follows. In subsection (1) for “subsection (3)” substitute “ subsections (3) to (3ZB) ”. After subsection (3) insert— In subsection (3A), after “subsection (3)” insert “ or (3ZA) ”. In subsection (4), after “subsection (3)” insert “ or (3ZA) ”.
In section 171 (transfers within a group: general provisions), in subsection (2), after paragraph (b) insert—.
After section 187 insert—
In section 271 (miscellaneous exemptions)—
in subsection (1A), after “registered pension scheme” insert “ or an overseas pension scheme ”, and
in subsection (10), for the words after “above” substitute “—
“overseas pension scheme” has the same meaning as in Part 4 of the Finance Act 2004 (see section 150(7) of that Act).”
“ATED-related”, in relation to a gain or loss, is to be construed in accordance with section 57A and Schedule 4ZZA; “relevant high value disposal” has the meaning given by section 2C;
After Schedule 4 insert—
In Schedule 7A (restriction on set-off of pre-entry losses), after paragraph 10 insert—
The amendments made by this Schedule have effect in relation to disposals occurring on or after 6 April 2013.
Section 71
Section 74
Section 75
Section 77
Before Part 11A of ITA 2007 insert—
Before Part 18 of CTA 2010 insert—
The amendments made by Parts 1 and 2 of this Schedule have effect in relation to any payment representative of a dividend or interest which is made on or after 1 January 2014.
The amendments made by Part 3 of this Schedule come into force on that date.
Section 79
Part 10 of CTA 2010 (close companies) is amended as follows.
In section 438 (overview), after subsection (2) insert— The amendment made by this paragraph is treated as having come into force on 20 March 2013.
In section 455 (charge to tax in case of loan to participator), for subsection (1) substitute— The amendment made by this paragraph has effect in relation to a loan or advance made on or after 20 March 2013.
In section 459(2) (application of other provisions where loan treated as made to participator), after “458” insert “ and 464C and 464D ”. The amendment made by this paragraph is treated as having come into force on 20 March 2013.
After Chapter 3 insert— The amendment made by this paragraph has effect in relation to arrangements to which a close company becomes a party on or after 20 March 2013.
After Chapter 3A insert— The amendment made by this paragraph has effect in relation to repayments and return payments made on or after 20 March 2013.
In section 465 (power to obtain information), after “Chapter 3” (in both places) insert “ or 3A ”.
Section 89
The amendments made by this Schedule have effect in relation to expenditure incurred on or after the day on which this Act is passed.
Section 93
CAA 2001 is amended as follows.
After section 165 insert—
In section 26(5), at the end insert “and sections 165A to 165E (restrictions on allowances: anti-avoidance).”
sections 165A to 165E (restrictions on allowances: anti-avoidance);
In section 161C(3), for “and 164(4)” substitute “, 164(4) and 165A to 165E”.
In section 164(5A), at the end insert “and sections 165A to 165E.”
After section 165(3) insert—
The amendments made by this Part have effect in relation to expenditure incurred on decommissioning carried out on or after the day on which this Act is passed.
After section 416ZB of CAA 2001 (inserted by section 92) insert—
In section 395(3) of that Act (provisions limiting “qualifying expenditure”) for “Chapter 4 contains” substitute “Chapters 4 and 5 contain”.
The amendments made by this Part have effect in relation to expenditure incurred on restoration carried out on or after the day on which this Act is passed.
Part 4 of TIOPA 2010 (transfer pricing) is amended as follows.
In section 147(6) (list of exceptions to the basic rule stated in that section), after paragraph (b) insert—.
After section 206 insert—
In section 213 (effect of Part 4 on capital allowances), after subsection (2) insert—
The amendments made by this Part have effect for accounting periods ending on or after the day on which this Act is passed.
Section 162
Section 164
Schedule 36 to FA 2008 (information and inspection powers) is amended as follows.
In paragraph 12A (powers to inspect property for valuation etc), in sub-paragraph (3)—
omit the “or” after paragraph (d), and
after paragraph (e) insert , or
After paragraph 21A insert—
Where, in respect of a single-dwelling interest (see paragraph 21B(7)) to which one or more companies are or were entitled as members of a partnership, any member of the partnership has— paragraph 21B (restrictions where taxpayer has delivered return) has effect as if that return had been delivered, or that claim had been made, by each member of the partnership.
In paragraph 63(1) (meaning of “tax” in the Schedule), after paragraph (h) insert—.
Section 168
In relation to the chargeable period beginning on 1 April 2013, section 159(annual tax on enveloped dwellings return) has effect as if subsections (2) and (3) of that section provided as follows—
In relation to the chargeable period beginning on 1 April 2013, section 163(payment of tax) has effect as if subsection (1) of that section provided as follows—
Section 176
Section 190
VERA 1994 is amended as follows.
Section 19 (rebates) is amended as follows. In subsection (3), after paragraph (c) insert—. After that subsection insert—
Section 22ZA (nil licences for vehicles for disabled persons: information) is amended as follows. In subsection (1)(b), at the beginning insert “falls within subsection (1A) or”. After subsection (1) insert— In subsections (2) and (4), and in the heading, omit “nil”. For subsection (5) substitute—
In section 62(1) (definitions), at the appropriate places insert—, and .
In Schedule 1 (annual rates of duty), in Part 1 after paragraph 1 insert—
In Schedule 2 (exempt vehicles), paragraph 19 is amended as follows. In sub-paragraph (1), for paragraph (b) substitute— In sub-paragraph (2), after paragraph (a) insert—. This paragraph has effect as if a person were in receipt of personal independence payment by virtue of entitlement to the mobility component at the enhanced rate in any case where the person would be in receipt of that payment by virtue of that entitlement but for— In sub-paragraph (3), for “person in receipt of a disability living allowance by virtue of entitlement to the mobility component at the higher rate, or of a mobility supplement,” substitute “disabled person who satisfies sub-paragraph (2) by virtue of paragraph (a), (aa), (ab) or (b) of that sub-paragraph”. In sub-paragraph (4)(a), after “disability living allowance,” insert “personal independence payment or armed forces independence payment,”.
The amendments made by this Schedule are treated as having come into force on 8 April 2013.
Section 192
Section 195
Part 4 of FA 2003 (stamp duty land tax) is amended as follows.
For section 45 (contract and conveyance: effect of transfer of rights) substitute—
After Schedule 2 insert—
In section 57A (sale and leaseback arrangements), in subsection (3)(c)—
omit “section 45 (contract and conveyance: effect of transfer of rights) or”, and
after the second occurrence of “transfer of rights)” insert “or a pre-completion transaction within the meaning of Schedule 2A (transactions entered into before completion of contract)”.
In section 77 (notifiable transactions), in subsection (1)—
omit the “or” after paragraph (c), and
after paragraph (d) insert, or
In section 79(2) (registration of land transactions etc)—
omit paragraph (a)(i) and the “or” after it, and
after paragraph (b) insert—.
paragraph 5 of Schedule 2A,
In section 121 (index of defined expressions), in the entry for “vendor”, in the second column, for “sections 45(5A) and 45A(9)” substitute “section 45A(9) and paragraphs 8, 10 and 11 of Schedule 2A”.
In Schedule 6B (transfers involving multiple dwellings), in paragraph 7(6), in the definition of “relevant deeming provision”, after “45A” insert “or paragraph 5(1) or (2) of Schedule 2A”.
In paragraph 12B of Schedule 17A (assignment of agreement for lease), in sub-paragraph (1) for “section 45 (contract and conveyance: effect of transfer of rights)” substitute “Schedule 2A (transactions entered into before completion of contract)”.
The amendments made by this Schedule have effect in relation to transfers of rights (see section 45 of FA 2003) and pre-completion transactions (see paragraph 3) entered into on or after the day on which this Act is passed.
Section 196
Part 4 of FA 2003 (stamp duty land tax) is amended as follows.
Section 197
“the leasehold interest” means the interest granted to the lessee under the second transaction;
Part 4 of FA 2003 (stamp duty land tax) is amended as follows.
In Schedule 17A, omit paragraphs 14 and 15 (abnormal increases in rent after fifth year). Accordingly, the following are also repealed—
TCGA 1992 is amended as follows.
This Part of this Schedule—
explains when, as respects an individual, a tax year is a split year,
defines the overseas part and the UK part of a split year, and
amends certain enactments to provide for special charging rules in cases involving split years.
The circumstances of a case fall within Case 2 if they are as described in sub-paragraphs (2) to (6). The taxpayer was resident in the UK for the previous tax year (whether or not it was a split year). The taxpayer has a partner whose circumstances fall within Case 1 for— On a day in the relevant year, the taxpayer moves overseas so the taxpayer and the partner can continue to live together while the partner is working overseas. In the part of the relevant year beginning with the deemed departure day— The taxpayer is not resident in the UK for the next tax year. If sub-paragraph (3)(a) applies, the “deemed departure day” is the later of— If sub-paragraph (3)(b) applies, the “deemed departure day” is the day mentioned in sub-paragraph (4). The permitted limit is the number found by reducing 90 by the appropriate number. The appropriate number is the result of— where— “A” is 90, and “B” is the number of whole months in the part of the relevant year before the deemed departure day.
The circumstances of a case fall within Case 5 if they are as described in sub-paragraphs (2) and (3). The taxpayer was not resident in the UK for the previous tax year. There is at least one period of 365 days in respect of which the following conditions are met— To work out whether the taxpayer works “sufficient hours in the UK” as assessed over a given period, apply paragraph 9(2) but for “P” read “the taxpayer”. Paragraphs 17 to 20 (and Part 2 of this Schedule so far as it relates to those paragraphs) apply for the purposes of sub-paragraph (3)(b) with the following adjustments— The appropriate number is found by multiplying the number of days, in each case, by— where “A” is the number of whole months in the part of the relevant year beginning with the day on which the 365-day period in question begins. Sub-paragraph (5)(a) does not apply to the references to year X in paragraphs 32(1)(b) and 33 of this Schedule (which relate to the residence status of family members) so those references must continue to be read as references to year X.
The circumstances of a case fall within Case 8 if they are as described in sub-paragraphs (2) to (5). The taxpayer was not resident in the UK for the previous tax year. At the start of the relevant year, the taxpayer had no home in the UK but— For the part of the relevant year before the day mentioned in sub-paragraph (3)(a), the taxpayer does not have sufficient UK ties. The taxpayer is resident in the UK for the next tax year and that tax year is not a split year as respects the taxpayer. Paragraphs 17 to 20 (and Part 2 of this Schedule so far as it relates to those paragraphs) apply for the purposes of sub-paragraph (4) with the following adjustments— The appropriate number is found by multiplying the number of days, in each case, by— where “A” is the number of whole months in the part of the relevant year beginning with the day mentioned in sub-paragraph (3)(a). Sub-paragraph (6)(a) does not apply to the references to year X in paragraphs 32(1)(b) and 33 of this Schedule (which relate to the residence status of family members) so those references must continue to be read as references to year X.
This paragraph applies to determine which Case has priority where the taxpayer’s circumstances for the relevant year fall within two or all of the following— Case 1 (starting full-time work overseas); Case 2 (the partner of someone starting full-time work overseas); Case 3 (ceasing to have a home in the UK). Case 1 has priority over Case 2 and Case 3. Case 2 has priority over Case 3.
ITEPA 2003 is amended as follows.
ITTOIA 2005 is amended as follows.
CTA 2009 is amended as follows.
In section 41 of the Constitutional Reform and Governance Act 2010 (tax status of MPs and members of the House of Lords), in subsection (2), omit “, ordinarily resident”. The amendment made by this paragraph has effect for the purposes of a member’s liability to income tax or capital gains tax for the tax year 2013-14 or any subsequent tax year.
The amendments made by this Schedule are treated as having come into force on 11 December 2012 in relation to an accounting period if the relevant day, in relation to that period, falls on or after 11 December 2012. In sub-paragraph (1) “the relevant day”, in relation to an accounting period, means the first day after the period of 9 months beginning immediately after the accounting period. But if the relevant day falls between 11 December 2012 and 31 March 2013 (inclusive), paragraphs 1(4) and 4(3) of Schedule 3ZB to TMA 1970 (inserted by this Schedule) have effect as if, in each case, for “before the end of the period of 9 months beginning immediately after the migration accounting period” there were substituted “on or before 31 March 2013”.
Section 169D (exceptions to rules on gifts to settlor-interested settlements etc) is amended as follows. For subsection (3) substitute— After subsection (4) insert— For subsections (7) to (9) substitute— Omit subsection (10). The amendments made by this paragraph have effect in relation to disposals to the trustees of a settlement on or after 8 April 2013. But if the settlement is a relevant settlement, nothing in this paragraph is to be read as preventing section 169D(2) of TCGA 1992 from applying in relation to the disposal.
The effect of a tax year being a split year is to relax the effect of paragraph 2(3) (which treats individuals who are UK resident “for” a tax year as being UK resident at all times in that year). When and how the effect of paragraph 2(3) is relaxed is defined in the special charging rules introduced by the amendments made by this Part. Subject to those special charging rules (and any other special charging rules for split years that may be introduced in the future), nothing in this Part alters an individual’s residence status for a tax year or affects his or her liability to tax.
In section 15 (earnings for year when employee UK resident), for subsection (1) substitute— After subsection (3) insert—
In section 6 (territorial scope of charge to tax), after subsection (2) insert—
In section 900 (which relates to roll-over relief for disposals of pre-FA 2002 assets), in subsection (2), omit “or ordinarily UK resident”. The amendment made by this paragraph applies in relation to gains accruing or treated as accruing on or after 6 April 2013.
Paragraph 1 of Schedule 1 (application of exempt amount and reporting limits in cases involving settled property) is amended as follows. In sub-paragraph (1)— The trusts on which settled property is held are not to be treated as falling outside sub-paragraph (1) by reason only of— For the purposes of this paragraph, the “annual limit” for a tax year is whichever is the lower of the following amounts— The Treasury may by order— An order under sub-paragraph (1C) may— A statutory instrument containing an order under sub-paragraph (1C) may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, the House of Commons. In sub-paragraph (2), for the words from the beginning to “that sub-paragraph” substitute “The reference in sub-paragraph (1)”. In sub-paragraph (6), for the definitions of “mentally disabled person”, “attendance allowance” and “disability living allowance” substitute—. The amendments made by this paragraph have effect in relation to the tax year 2013-14 and subsequent tax years. But if the settlement is a relevant settlement, nothing in this paragraph is to be read as preventing sections 3(1) to (5C) and 3A of TCGA 1992 from applying in relation to the settlement as provided by paragraph 1(1) of Schedule 1 to that Act.
This Part—
does not apply in determining the residence status of personal representatives, and
applies to only a limited extent in determining the residence status of the trustees of a settlement (see section 475 of ITA 2007 and section 69 of TCGA 1992, as amended by this Part).
In section 22 (chargeable overseas earnings for year when remittance basis applies and employee outside section 26), for subsection (7) substitute—
Section 17 (effect of becoming or ceasing to be UK resident) is amended as follows. For subsection (1) substitute— In subsection (2), at the beginning insert “If this section applies and the individual does not actually cease permanently to carry on the trade immediately before the change of residence occurs,”.
In section 936 (meaning of “UK estate” and “foreign estate”), in subsection (3), omit “or not ordinarily UK resident”. The amendment made by this paragraph applies if the tax year in question begins on or after 6 April 2013.
The existence of special charging rules for cases involving split years is not intended to affect any question as to whether an individual would fall to be regarded under double taxation arrangements as a resident of the UK.
Section 23 (calculation of “chargeable overseas earnings”) is amended as follows. Step 1 Identify— in the case of a tax year that is not a split year, the full amount of the overseas earnings for that year, and in the case of a split year, so much of the full amount of the overseas earnings for that year as is attributable to the UK part of the year. In that subsection, in step 2, for “those earnings” substitute “the earnings identified under step 1”. After that subsection insert—
In section 243 (post-cessation receipts: extent of charge to tax), after subsection (5) insert—
In section 947 (aggregate income of the estate), in subsection (2)(b)(i), omit “who was ordinarily UK resident”. The amendment made by this paragraph applies if the tax year in question begins on or after 6 April 2013.
Section 24 (limit on chargeable overseas earnings where duties of associated employment performed in UK) is amended as follows. After subsection (2) insert— After subsection (3) insert—
In section 849 (calculation of firm’s profits or losses), after subsection (3) insert—
In section 1009 (conditions relating to employee’s income tax position), in subsection (5)(a), omit “and ordinarily UK resident”. The amendment made by this paragraph applies in relation to shares acquired on or after 6 April 2013.
Section 26 (foreign earnings for year when remittance basis applies and employee meets section 26A requirement) is amended as follows. In subsection (1), for the words from “if the general earnings” to the end substitute if the general earnings meet all of the following conditions— After subsection (5) insert— For subsection (6) substitute—
Section 852 (carrying on by partner of notional trade) is amended as follows. For subsection (6) substitute— After subsection (7) insert—
In section 1017 (condition relating to employee’s income tax position), in subsection (4)(a), omit “and ordinarily UK resident”. The amendment made by this paragraph applies in relation to options obtained on or after 6 April 2013.
In section 232 (giving effect to mileage allowance relief), after subsection (6) insert—
Section 854 (carrying on by partner of notional business) is amended as follows. For subsection (5) substitute— After that subsection insert—
In section 1025 (additional relief available if shares acquired are restricted shares), in subsection (5)(a), omit “and ordinarily UK resident”. The amendment made by this paragraph applies in relation to restricted shares acquired on or after 6 April 2013.
Section 329 (deduction from earnings not to exceed earnings) is amended as follows. After subsection (1) insert— In subsection (2), after “those earnings” insert “(or, in a case within subsection (1A), the part of those earnings that is not “excluded”)”. In subsection (3), after “the earnings” insert “(or, in a case within subsection (1A), the part of the earnings that is not “excluded”)”.
In section 1032 (meaning of “chargeable event”), in subsection (5)(a), omit “and ordinarily UK resident”. The amendment made by this paragraph applies in relation to convertible shares acquired on or after 6 April 2013.
Section 394 (charge on employer-financed retirement benefits) is amended as follows. In subsection (4C), omit “or” at the end of paragraph (b) and after that paragraph insert—. In that subsection, for paragraph (c) substitute—
Section 421E (income relating to securities: exclusions about residence etc) is amended as follows. For subsection (1) substitute— After subsection (2) insert—
In section 474 (cases where Chapter 5 of Part 7 does not apply), for subsection (1) substitute—
Section 554Z4 (residence issues) is amended as follows. For subsections (3) to (5) substitute— After subsection (5) insert—
In section 554Z6 (overlap with certain earnings), in subsection (1)(a), after “UK resident” insert “(and, in the case of a tax year that is a split year as respects A, are not “excluded” by virtue of section 15(1A)(a) and (b)(i))”.
In section 554Z9 (remittance basis: A is ordinarily UK resident), in subsection (5)—
in paragraph (b), after “that income” insert “(or of so much of it as is attributable to the UK part of the relevant tax year, if it was a split year as respects A)”, and
in paragraph (c), after “tax year” insert “(or the UK part of it)”.
Section 554Z10 (remittance basis: A is not ordinarily resident) is amended as follows. In subsection (1), for paragraph (a) substitute—. For subsection (2) substitute— After that subsection insert— In subsection (3), for “this purpose” substitute “the purposes of this section”. For subsection (4) substitute—
Section 200
On and after 26 March 2013, Schedule 6 to FA 2000 (climate change levy) has effect as if neither— had ever been enacted. Accordingly— The amendments made by sub-paragraph (2) are treated as having come into force on 26 March 2013.
The carbon price support rates are as follows. Carbon price support rate commodity Carbon price support rate Any gas in a gaseous state that is of a kind supplied by a gas utility £0.00175 per kilowatt hour Any petroleum gas, or other gaseous hydrocarbon, in a liquid state £0.02822 per kilogram Any commodity falling within paragraph 3(1)(d) to (f) £0.85489 per gigajoule The amendment made by this paragraph has effect in relation to supplies treated as taking place on or after 1 April 2014 but before 1 April 2015.
The carbon price support rates are as follows. Carbon price support rate commodity Carbon price support rate Any gas in a gaseous state that is of a kind supplied by a gas utility £0.00334 per kilowatt hour Any petroleum gas, or other gaseous hydrocarbon, in a liquid state £0.05307 per kilogram Any commodity falling within paragraph 3(1)(d) to (f) £1.62534 per gigajoule The amendment made by this paragraph has effect in relation to supplies treated as taking place on or after 1 April 2015.
Section 209
Section 216
Section 218
“conditionally exempt occasion” is to be read in accordance with section 78(2) of that Act;
P has an accommodation tie for year X if— If there is a gap of fewer than 16 days between periods in year X when a particular place is available to P, that place is to be treated as continuing to be available to P during the gap. P is considered to have a “place to live” in the UK if— Accommodation may be “available” to P even if P holds no estate or interest in it and even if P has no legal right to occupy it. If the accommodation is the home of a close relative of P’s, sub-paragraph (1)(c) has effect as if for “at least one night” there were substituted “a total of at least 16 nights”. A “close relative” is— in each case, including by half-blood or by marriage or civil partnership.
P has a country tie for year X if the country in which P meets the midnight test for the greatest number of days in year X is the UK. If— P has a country tie for year X if one of those countries is the UK. P meets the “midnight test” in a country for a day if P is present in that country at the end of that day.
This Part of this Schedule—
explains when an individual is to be regarded for the purposes of certain enactments as temporarily non-resident,
defines the year of departure and the period of return for the purposes of those enactments,
makes consequential amendments to certain enactments containing special rules for temporary non-residents, and
inserts some more special rules for temporary non-residents in certain cases.
An individual has “sole UK residence” for a residence period consisting of an entire tax year if— An individual has “sole UK residence” for a residence period consisting of part of a split year if— An individual is “Treaty non-resident” at any time if at the time the individual falls to be regarded as resident in a country outside the UK for the purposes of double taxation arrangements having effect at the time.
“The period of return” is the first residence period after period A for which the individual has sole UK residence.
Nothing in section 6 or 7 of the Commissioners for Revenue and Customs Act 2005 (initial functions) restricts the functions in connection with which officers of Revenue and Customs may exercise a power under—
Chapter 3 of Part 5 of the Proceeds of Crime Act 2002 (as amended by this Schedule), or
Chapters 2 and 3 of Part 8 of that Act (as so amended).
6ZA Corporation tax Amount payable under an exit charge payment plan entered into in accordance with Schedule 3ZB to TMA 1970 The later of— the first day after the period of 12 months beginning immediately after the migration accounting period (as defined in Part 1 or 2 of Schedule 3ZB to TMA 1970, as the case may be), and the date on which the amount is payable under the plan.
Schedule 55 (penalty for failure to make returns etc) to FA 2009 is amended in accordance with paragraphs 3 to 9.
The amendments made by paragraph 1 have effect in relation to any assessment of a penalty under Schedule 24 to FA 2007 made on or after the day on which this Act is passed. The amendments made by paragraphs 2 to 9 and 15 have effect for the tax year 2014-15 and subsequent tax years in relation to failures to make returns with a filing date (as defined in paragraph 1(4) of Schedule 55 to FA 2009) on or after 6 April 2014. The amendments made by paragraphs 10 to 14 have effect for defaults made in relation to the tax year 2014-15 and subsequent tax years (see paragraph 6(2) of Sch.56 to FA 2009 (as amended by paragraph 12(3) of this Schedule) as to when a default is made in relation to a tax year).
In paragraph 1 (returns etc in respect of which penalties are to be paid under that Schedule)—
in the definition of “penalty date” in sub-paragraph (4), after “document” insert “falling within any of items 1 to 3 and 5 to 13 in the Table”;
The Treasury may by order make such amendments to item 4 in the Table as they think fit in consequence of any amendment, revocation or re-enactment of the regulations mentioned in that item.
Return under any of the following provisions of the Income Tax (PAYE) Regulations 2003 (S.I. 2003/2682)— regulation 67B (real time returns) regulation 67D (exceptions to regulation 67B)
In paragraph 2 (amount of penalty: occasional returns and returns for periods of 6 months or more), for “1 to 5” substitute “1 to 3, 5”.
After paragraph 6A insert—
Sub-paragraph (6) applies if— HMRC may by notice to P amend the assessment so that it is based upon the correct amount. An amendment under sub-paragraph (6)—
Paragraph 19 (assessment) is amended as follows. In sub-paragraph (2) after “Date A is” insert —. In sub-paragraph (3)(a), after “return” insert “or returns (as the case may be in relation to penalties under section 6C or 6D)”.
Paragraph 27 (interpretation) is amended as follows. The Commissioners” means the Commissioners for Her Majesty’s Revenue and Customs. Tax month” means the period beginning with the 6th day of a month and ending with the 5th day of the following month.
references to a “major interest” in land are to be read in accordance with section 117 of FA 2003;
ITEPA 2003 is amended as follows.
In Chapter 2 of Part 6 (employer-financed retirement benefits), after section 394 insert—
In Chapter 2 of Part 7A (employment income provided through third parties: treatment of relevant step for income tax purposes), after section 554Z4 insert—
In that Chapter, after section 554Z11 insert—
In that Chapter, in section 554Z12 (relevant step taken after A’s death etc), after subsection (8) insert—
In Chapter 3 of Part 9 (United Kingdom pensions: general rules), after section 572 insert—
In Chapter 1 of Part 11 (pay as you earn: introduction), section 683 is amended as follows. After subsection (3) insert— For subsection (3B) substitute—
Section 219
Section 220
Section 224
Section 229
Section 230
Section 233
This section is treated as having come into force on 6 April 2013.
An accredited competitor who performs a Commonwealth Games activity is not liable to income tax in respect of any income arising from the activity if the non-residence condition is met.
The following are Commonwealth Games activities—
competing at the Glasgow Commonwealth Games, and
any activity that is performed during the games period the main purpose of which is to support or promote the Glasgow Commonwealth Games or any future Commonwealth Games.
The non-residence condition is that—
the accredited competitor is non-UK resident for the tax year in which the Commonwealth Games activity is performed, or
the accredited competitor is UK resident for the tax year in which the activity is performed but the year is a split year as respects the competitor and the activity is performed in the overseas part of the year.
Section 966 of ITA 2007 (deduction of sums representing income tax) does not apply to any payment or transfer which gives rise to income benefiting from the exemption under subsection (1).
In this section—
“chargeable event” means an event which is a chargeable event under section 32 of IHTA 1984;
Chapter 5 (trade profits: rules allowing deductions) is amended as follows.
In Chapter 8 (trade profits: herd basis rules), after section 111 insert—
In Chapter 10A (leases of plant or machinery: special rules for long funding leases), before section 148A (and the italic heading preceding it) insert—
In Chapter 13 (deductions from profits: unremittable amounts), after section 188 insert—
In Chapter 16ZA (compensation for compulsory slaughter of animal), after section 225ZA insert—
But sub-paragraph (1) above does not apply to any expenditure for which the relevant participator is liable that has been or is to be met directly or indirectly out of a payment made by the guarantor under an abandonment guarantee. In sub-paragraph (1A) above—
P has a work tie for year X if P works in the UK for at least 40 days (whether continuously or intermittently) in year X. For these purposes, P works in the UK for a day if P does more than 3 hours’ work in the UK on that day.
Section 575 of ITEPA 2003 (foreign pensions: taxable pension income) is amended as follows. In subsection (1), after “subsections” insert “(1A),”. After that subsection insert— In subsection (2), after “tax year” insert “or, as the case may be, the UK part of the tax year”.
In section 270 of ITTOIA 2005 (profits of property businesses: income charged), after subsection (2) insert—
In section 832 of ITTOIA 2005 (relevant foreign income charged on remittance basis), for subsection (2) substitute—
In relation to an individual, a “residence period” is—
a tax year that, as respects the individual, is not a split year, or
the overseas part or the UK part of a tax year that, as respects the individual, is a split year.
“The year of departure” is the tax year consisting of or including period A.
“decommissioning relief agreement” has the same meaning as in section 80, and
“participator” has the same meaning as in that Part (see section 454 of that Act).
In Chapter 3 of Part 2 of ITA 2007 (calculation of income tax liability) after section 24 insert—
Chapter 3 (trade profits: basic rules) is amended as follows.
Section 659 (meaning of “open to the whole community”) is amended as follows. In subsection (1), for paragraph (c) substitute— After subsection (2) insert— For subsection (3) substitute—
Chapter 1 of Part 4 of TCGA 1992 (general provision relating to shares etc) is amended as follows.
If the matter is referred to the GAAR Advisory Panel, the Chair must arrange for a sub-panel consisting of 3 members of the GAAR Advisory Panel (one of whom may be the Chair) to consider it. The sub-panel may invite the taxpayer or the designated HMRC officer (or both) to supply the sub-panel with further information within a period specified in the invitation. Invitations must explain the effect of sub-paragraph (4) or (5) (as appropriate). If the taxpayer supplies information to the sub-panel under this paragraph, the taxpayer must at the same time send a copy of the information to the designated HMRC officer. If the designated HMRC officer supplies information to the sub-panel under this paragraph, the officer must at the same time send a copy of the information to the taxpayer.
An individual (“P”) is resident in the UK for a tax year (“year X”) if—
the automatic residence test is met for that year, or
the sufficient ties test is met for that year.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
In section 105 (disposal on or before day of acquisition of shares etc) after subsection (3) insert—
Where the matter is referred to the GAAR Advisory Panel, the sub-panel must produce— The sub-panel must give a copy of the opinion notice or notices to— An opinion notice is a notice which states that in the opinion of the members of the sub-panel, or one or more of those members— and the reasons for that opinion. For the purposes of the giving of an opinion under this paragraph, the arrangements are to be assumed to be tax arrangements. In this Part, a reference to any opinion of the GAAR Advisory Panel about any tax arrangements is a reference to the contents of any opinion notice about the arrangements.
If neither of those tests is met for that year, P is not resident in the UK for that year.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 106A (identification of securities for capital gains tax purposes) is amended as follows. In subsection (5)— After subsection (6) insert— relevant EMI shares” has the meaning given by section 169I(7C) to (7G),
After Chapter 3 insert—
After section 56 insert—
In Schedule 5 to OTA 1975 (allowance of expenditure), in paragraph 2C(2), in the definition of “sum in default”, for the words from “less the aggregate of” to the end substitute “ less so much of that payment as has been made by the defaulter ”.
This paragraph applies for the purposes of paragraph 35. It applies in cases where P has a relevant job on board a vehicle, aircraft or ship. When making a cross-border trip as part of that job— Those assumptions apply regardless of how late in the day the trip begins or ends (even if it begins or ends just before midnight). For the purposes of sub-paragraph (3)(a), it does not matter whether the trip ends on that same day. A day that falls within both paragraph (a) and paragraph (b) of sub-paragraph (3) is to be treated as if it fell only within paragraph (a). In the case of a cross-border trip to or from the UK that is undertaken in stages—
Chapter 2 of Part 13 of ITA 2007 (transfer of assets abroad) is amended as follows in consequence of the amendment made by the preceding paragraph. In section 726 (non-UK domiciled individuals to whom remittance basis applies), after subsection (4) insert— In section 730 (non-UK domiciled individuals to whom remittance basis applies), after subsection (4) insert— In section 735 (non-UK domiciled individuals to whom remittance basis applies), after subsection (4) insert—
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Part 3 of FA 1991 (oil taxation) is amended as follows. Omit section 105 (restriction of expenditure relief by reference to payments under abandonment guarantees). Omit section 106 (relief for reimbursement expenditure under abandonment guarantees).
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
In Part 2 of ITTOIA 2005 (trading income), Chapter 16A (oil activities) is amended as follows. In section 225N (expenditure on and under abandonment guarantees), omit subsections (3) and (4). Omit section 225O (relief for reimbursement expenditure under abandonment guarantees).
In section 72 (payroll deduction schemes: contributions to agents' expenses), after subsection (2) insert—
In Part 8 of CTA 2010 (oil activities), Chapter 4 (calculation of profits) is amended as follows. In section 292 (expenditure on and under abandonment guarantees), omit subsections (3) and (4). Omit section 293 (relief for reimbursement expenditure under abandonment guarantees).
In section 94A (costs of setting up SAYE option scheme or CSOP scheme), after subsection (4) insert—
“abandonment programme” means an abandonment programme approved under Part 4 of the Petroleum Act 1998 (including such a programme as revised),
In section 266A of ICTA (life assurance premiums paid by employer), in subsection (8)—
in paragraph (a), for “employee resident and ordinarily resident, but not domiciled, in UK” substitute “remittance basis applies and employee outside section 26”, and
in paragraph (b), for “employee resident, but not ordinarily resident, in UK” substitute “remittance basis applies and employee meets section 26A requirement”.
References in this Part of this Schedule to an individual’s “foreign income and gains” for a tax year are to be read in accordance with section 809Z7 of ITA 2007 (interpretation of remittance basis rules).
In section 12 of TCGA 1992 (non-UK domiciled individuals to whom remittance basis applies), for subsection (1) substitute—
In section 87B of that Act (section 87: remittance basis), in subsection (1)—
insert “and” at the end of paragraph (a),
omit “and” at the end of paragraph (b), and
omit paragraph (c).
In section 726 of ITA 2007 (non-UK domiciled individuals to whom remittance basis applies), for subsection (1) substitute—
In section 730 of that Act (non-UK domiciled individuals to whom remittance basis applies), for subsection (1) substitute—
In section 735 of that Act (non-UK domiciled individuals to whom remittance basis applies), for subsection (1) substitute—
In section 809F of that Act (effect on what is chargeable), in subsection (4), for “If the individual is not domiciled in the United Kingdom in that year, the” substitute “The”.
In section 809YD of that Act (chargeable gains accruing on sales of exempt property), in subsection (3), omit “and P is not domiciled in the United Kingdom in that year”.
In section 809Z7 of that Act (meaning of “foreign income and gains” etc)—
in subsection (2)(d), omit “if the individual is not domiciled in the United Kingdom in that year,”, and
in subsection (3)(a), for “is ordinarily UK resident in” substitute “does not meet the requirement of section 26A of ITEPA 2003 for”.
After section 293A of ITEPA 2003 insert—
The amendment made by this section has effect in relation to payments made on or after 6 April 2013.
In Chapter 9 of Part 4 of ITEPA 2003 (exemptions from income tax for pension provision), in section 308 (exemption of contributions to registered pension scheme), at the end insert “ in respect of the employee ”.
The amendment made by this section has effect for the tax year 2013-14 and subsequent tax years.
In section 318B of ITEPA 2003 (childcare: meaning of “disabled” etc), in subsection (3)(a), after “allowance” insert “ or personal independence payment ”.
The amendment made by this section has effect for the tax year 2013-14 and subsequent tax years.
Universal credit WRA 2012 Part 1 Any provision made for Northern Ireland which corresponds to Part 1 of WRA 2012
The amendment made by this section has effect for the tax year 2013-14 and subsequent tax years.
Schedule 2 amends the SIP code, the SAYE code, the CSOP code and the EMI code.
Chapter 4 of Part 8 of ITA 2007 (reliefs: annual payments and patent royalties) is amended in accordance with subsections (2) and (3).
In section 448 (relief for individuals), in subsection (1)(b) omit “or 903(5)” and “and patent royalties”.
In section 449 (relief for other persons), in subsection (1)(b) omit “or 903(6)” and “and patent royalties”.
Accordingly, that Act is amended as follows—
in section 2 (overview of Act), in subsection (8)(c) omit “and patent royalties”,
in section 24 (reliefs deductible at Step 2), in subsection (1)(b) omit “and patent royalties”, and
in the heading for Chapter 4 of Part 8 of that Act omit “AND PATENT ROYALTIES”.
The amendments made by this section have effect in relation to payments made on or after 5 December 2012.
Schedule 3 contains provision limiting the deductions which may be made at Step 2 of the calculation in section 23 of ITA 2007 (calculation of income tax liability).
Schedule 4 contains provision enabling the profits of a trade, profession or vocation to be calculated on the cash basis.
Schedule 5 contains provision enabling persons carrying on a trade, profession or vocation to claim deductions for certain expenses at a fixed rate.
Schedule 6 contains provision about employment income in cases where duties are performed in the UK and overseas.
Schedule 7 contains provision about the application of the remittance basis in relation to exempt property.
ITA 2007 is amended as follows.
In section 809K (sections 809L to 809Z6: introduction), in subsection (2)(e), for “809V” substitute “ 809UA ”.
Before section 809V (but after the italic heading) insert—
In section 809Z9(11) (taking proceeds etc offshore or investing them: modification of general provisions)—
for “section 809VB(2) but in that case” substitute “ sections 809UA(2) and 809VB(2), but in those cases ”, and
at the beginning of paragraph (b) insert “ in the case of section 809VB(2), ”.
The amendments made by this section have effect in relation to payments on account made in respect of the tax year 2012-13 and subsequent tax years.
In Chapter 8 of Part 2 of ITEPA 2003 (application of provisions to workers under arrangements made by intermediaries), in section 49 (engagements to which Chapter applies), for subsection (1)(c) substitute—
This section has effect for the tax year 2013-14 and subsequent tax years.
Section 139 of ITEPA 2003 (car with CO2 figure: the appropriate percentage) is amended in accordance with subsections (2) to (6).
In subsection (2), after “the relevant threshold” omit “for the year”.
For subsection (2)(a) substitute—.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
In subsection (3)—
after “the relevant threshold” omit “for the year”, and
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
In subsection (4)—
after “the relevant threshold” (in both places) omit “for the year”, and
in paragraph (b), for “35%” substitute “ 37% ”.
Section 140 of that Act (car without CO2 figure: the appropriate percentage) is amended in accordance with subsections (8) to (11).
In the Table in subsection (2), for “35%” substitute “ 37% ”.
For subsection (3)(a) substitute—.
In subsection (3)(b), for “35%” substitute “ 37% ”.
Omit subsection (3A).
The amendments made by this section have effect for the tax year 2015-16 and subsequent tax years.
Schedule 8 amends Chapter 9 of Part 4 of ITTOIA 2005 (gains from contracts for life insurance etc).
Schedule 9 amends Schedule 15 to ICTA (qualifying insurance policies) and makes other provision relating to qualifying policies under Schedule 15 to ICTA.
Schedule 10 amends Chapter 2 of Part 13 of ITA 2007 (tax avoidance: transfer of assets abroad).
Schedule 11 contains provision in connection with the payment of interest for the purposes of income tax.
Schedule 12 contains provision about returns which are economically equivalent to interest.
Section 105 of CTA 2010 (restriction on surrender of losses etc within section 99(1)(d) to (g)) is amended as follows.
In subsection (2), for “the surrendering company's gross profits of the surrender period” substitute “ the profit-related threshold ”.
In subsection (3), for “those gross profits” substitute “ the profit-related threshold ”.
After subsection (3) insert—
After subsection (5) insert—
The amendments made by this section have effect where the surrender period of the surrendering company ends on or after 20 March 2013, but subject to the following.
For the purposes of section 105(3A)(b) and (3B)(b) of CTA 2010, chargeable profits do not include—
chargeable profits for an accounting period within the meaning of Part 9A of TIOPA 2010 ending before 20 March 2013, or
chargeable profits for an accounting period within the meaning of Chapter 4 of Part 17 of ICTA ending before that date.
Subsection (9) applies where— falls partly before and partly on or after 20 March 2013.
an accounting period within the meaning of Part 9A of TIOPA 2010, or
an accounting period within the meaning of Chapter 4 of Part 17 of ICTA,
For the purposes of section 105 of CTA 2010, the chargeable profits of the CFC for that period, so far as apportioned to the surrendering company as mentioned in subsection (3A)(b) or (3B)(b) of that section (as the case requires), are to be further apportioned on a just and reasonable basis between the two parts of the period, and the chargeable profits referred to in subsection (3A)(b) or (3B)(b) are not to include the chargeable profits apportioned to the part ending before 20 March 2013.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 107 of CTA 2010 (surrender of losses etc) is amended as follows.
After subsection (1) insert—
In subsection (2) for “The” substitute “In any other case, the”.
After subsection (6) insert—
In subsection (7), after “subsection (6)” insert “or (6B)”.
The amendments made by this section have effect in relation to accounting periods beginning on or after 1 April 2013.
But for this purpose an accounting period beginning before, and ending on or after, 1 April 2013 is to be treated as if so much of the period as falls before that date, and so much of the period as falls on or after that date, were separate accounting periods.
An apportionment for the purposes of subsection (7) must be made in accordance with section 1172 of CTA 2010 (time basis) or, if that method produces a result that is unjust or unreasonable, on a just and reasonable basis.
In section 156 of CTA 2010 (definition of “arrangements” for purposes of sections 154 to 155B, etc)—
in subsection (2), in paragraph (b), after “include” insert— ,
at the end of that paragraph insert, or , and
after that subsection insert—
In sections 154(3) and 155(3) of that Act (arrangements for transfers), for “154A” substitute “ 155A ”.
In section 188 of that Act (other definitions for Part 5), in subsection (1), after “ “company”” insert “ (except in section 156(2A) ”.
The amendments made by this section have effect in relation to accounting periods ending on or after 1 April 2013.
For section 676 of CTA 2010 (disallowance of trading losses where company reconstruction without a change of ownership) substitute—
The amendment made by this section has effect in relation to changes in ownership that occur on or after 20 March 2013.
Schedule 13—
inserts into Part 14 of CTA 2010 (change in company ownership) a new Chapter 5A (shell companies: restrictions on relief), and
makes consequential provision.
Schedule 14—
inserts into CTA 2010 a new Part 14A (transfer of deductions), and
makes consequential provision.
Schedule 15 contains provision about R&D expenditure credits.
Schedule 16 contains provision about television production.
Schedule 17 contains provision about video games development.
Schedule 18 contains consequential amendments.
a clinical commissioning group section 1I of the National Health Service Act 2006 Health and Social Care Information Centre section 252 of the Health and Social Care Act 2012 National Health Service Commissioning Board section 1H of the National Health Service Act 2006 National Institute for Health and Care Excellence section 232 of the Health and Social Care Act 2012
In Chapter 8 of Part 22 of CTA 2010 (exemptions), after section 987 insert—
The amendment made by this section is treated as having come into force on 16 January 2012, but, in relation to any time before 22 November 2012, section 987A of CTA 2010 has effect as if paragraph (a) were omitted.
Schedule 19 amends Part 12 of CTA 2010 (real estate investment trusts).
Chapter 6 of Part 12 of CTA 2009 (relief for employee share acquisitions: relationship between relief under Part 12 and other reliefs) is amended as follows.
For section 1038 substitute—
After section 1038 insert—
For the purposes of the following subsections—
“pre-claim period” means the period—
This paragraph applies where the first straddling period begins before the relevant date. So far as concerns expenditure incurred before the relevant date, the maximum allowance under section 51A of CAA 2001 for the first straddling period is what would have been the maximum allowance for that period if the amendment made by section 7(1) had not been made. So far as concerns expenditure incurred on or after the relevant date but before 1 January 2013, the maximum allowance under section 51A of CAA 2001 for the first straddling period is— In sub-paragraph (3)— So far as concerns expenditure incurred on or after 1 January 2013, the maximum allowance under section 51A of CAA 2001 for the first straddling period is the sum of each maximum allowance that would be found if the period mentioned in paragraph 1(2)(b) and the period mentioned in paragraph 1(2)(c) were each treated as separate chargeable periods.
Paragraphs 1 to 3 also apply for the purpose of determining the maximum allowance under section 51K of CAA 2001 (operation of annual investment allowance where restrictions apply) in a case where one or more chargeable periods in which the relevant AIA qualifying expenditure is incurred are chargeable periods within paragraph 1(1) .... There is to be taken into account for those purposes only chargeable periods of one year or less (whether or not they are chargeable periods within paragraph 1(1) ...), and, if there is more than one such period, only that period which gives rise to the greatest maximum allowance. For the purposes of sub-paragraph (2) any chargeable period which— is to be treated as being a chargeable period of one year ending at the same time as it actually ends. Section 11(11) of FA 2011 is repealed. That repeal has effect in relation to cases where one or more chargeable periods in which the relevant AIA qualifying expenditure is incurred are chargeable periods within paragraph 1(1). Nothing in this paragraph affects the operation of sections 51M and 51N of CAA 2001.
Schedule 18 to FA 1998 (company tax returns, assessments and related matters) is amended as follows.
In Chapter 6A of Part 3 of CTA 2009 (trade profits: R&D expenditure credits), after section 104B insert—
Section 660 (meaning of “organised on an amateur basis”) is amended as follows. In subsection (1), omit the “and” after paragraph (b) and after that paragraph insert—. In subsection (4)(g)— After subsection (4) insert— After subsection (5) insert— After subsection (7) insert— After subsection (11) insert—
In section 2 of CTA 2009 (charge to corporation tax), after subsection (2) insert—
In Part 7 of CTA 2010 (community investment tax relief) after section 220A (as inserted by paragraph 9 above) insert— The amendment made by this paragraph has effect for the purpose of limiting CITR in respect of investments made on or after 1 April 2013. CITR in respect of investments made before that date is to be ignored for the purposes of section 220B(2) of CTA 2010.
IHTA 1984 is amended as follows.
Schedule 4A (higher rate for certain transactions) is amended as follows. In paragraph 2(6) (treatment of certain transactions as two separate chargeable transactions) for “and 5” substitute “, 5 to 5K and 6A to 6H”. For paragraph 5 (property developers) and the cross-heading preceding it substitute— After paragraph 5 insert— After paragraph 6 insert— In paragraph 9 (interpretation), at the appropriate places insert— .
In relation to transactions in relation to which section 29 of the Scotland Act 2012 (disapplication of UK stamp duty land tax) has effect, FA 2003 as amended by this Schedule has effect subject to the following further amendments. In section 81ZA, in subsection (6), in the definition of “alternative finance arrangements”, omit “72, 72A”. In Schedule 4A—
As respects an individual, a tax year is a “split year” if— The 8 Cases are described in paragraphs 44 to 51. In those paragraphs, the individual is referred to as “the taxpayer” and the tax year as “the relevant year”. In applying Part 2 of this Schedule to those paragraphs, for “P” read “the taxpayer”.
The circumstances of a case fall within Case 3 if they are as described in sub-paragraphs (2) to (6). The taxpayer was resident in the UK for the previous tax year (whether or not it was a split year). At the start of the relevant year the taxpayer had one or more homes in the UK but— In the part of the relevant year beginning with the day mentioned in sub-paragraph (3)(a), the taxpayer spends fewer than 16 days in the UK. The taxpayer is not resident in the UK for the next tax year. At the end of the period of 6 months beginning with the day mentioned in sub-paragraph (3)(a), the taxpayer has a sufficient link with a country overseas. The taxpayer has a “sufficient link” with a country overseas if and only if—
The circumstances of a case fall within Case 6 if they are as described in sub-paragraphs (2) to (4). The taxpayer— There is at least one period (consisting of one or more days) that— The taxpayer is resident in the UK for the next tax year (whether or not it is a split year). A period “satisfies the overseas work criteria” if— A day falls within this sub-paragraph if— To work out whether the taxpayer works “sufficient hours overseas” as assessed over a given period, apply paragraph 14(3) but with the following modifications— The permitted limit is— The appropriate number is the result of— where— “A” is— 30, for sub-paragraphs (5)(c) and (7)(d), or 90, for sub-paragraph (5)(d), and “B” is the number of whole months in the part of the relevant year after the 365-day period in question ends.
This paragraph applies for the purposes of paragraphs 44 to 51. A reference to “the previous tax year” is to the tax year preceding the relevant year. A reference to “the next tax year” is to the tax year following the relevant year. “Partner”, in relation to the taxpayer, means— If calculation of the appropriate number results in a number of days that is not a whole number, the appropriate number is to be rounded up or down as follows—
This paragraph applies to determine which Case has priority where the taxpayer’s circumstances for the relevant year fall within two or more of the following— Case 4 (starting to have a home in the UK only); Case 5 (starting full-time work in the UK); Case 6 (ceasing full-time work overseas); Case 7 (the partner of someone ceasing full-time work overseas); Case 8 (starting to have a home in the UK). In this paragraph “the split year date” in relation to a Case means the final day of the part of the relevant year defined in paragraph 53(5) to (9) for that Case. If Case 6 applies— If Case 7 (but not Case 6) applies— If two or all of Cases 4, 5 and 8 apply (but neither Case 6 nor Case 7), the Case which has priority is the one with the earliest split year date. But if, in a case to which sub-paragraph (5) applies, two or all of the Cases which apply share the same split year date and that date is the only, or earlier, split year date of the Cases which apply, the Cases with that split year date are to be treated as having priority.
In section 69 of TCGA 1992 (trustees of settlements), after subsection (2D) insert—
An individual is to be regarded as “temporarily non-resident” if— Terms used in sub-paragraph (1) are defined below.
the individual has sole UK residence for a residence period,
immediately following that period (referred to as “period A”), one or more residence periods occur for which the individual does not have sole UK residence,
at least 4 out of the 7 tax years immediately preceding the year of departure were either—
a tax year for which the individual had sole UK residence, or
a split year that included a residence period for which the individual had sole UK residence, and
the temporary period of non-residence is 5 years or less.
In relation to an individual, “the temporary period of non-residence” is the period between—
the end of period A, and
the start of the next residence period after period A for which the individual has sole UK residence.
In ITEPA 2003, for section 576A substitute—
Chapter 9 of Part 4 of ITTOIA 2005 (gains from contracts for life insurance etc) is amended as follows.
Chapter A1 of Part 14 of ITA 2007 (remittance basis) is amended as follows.
ITA 2007 is amended as follows.
TMA 1970 is amended as follows.
Paragraph 10 (other claims and elections to be included in return) is amended as follows. In sub-paragraph (4), for “film tax relief” substitute “ tax relief under Part 15, 15A or 15B of the Corporation Tax Act 2009 ”. After sub-paragraph (5) insert—
In Part 8 of CTA 2009 (intangible fixed assets), in Chapter 10 (excluded assets), after section 808 insert—
Section 162 (liabilities) is amended as follows. In subsection (4), after “possible” insert “and to the extent that it is not taken to reduce value in accordance with section 162B”. In subsection (5), after “possible” insert “and to the extent that it is not taken to reduce value in accordance with section 162B”.
In section 475 of ITA 2007 (residence of trustees), after subsection (6) insert—
In ITEPA 2003, for section 579CA substitute—
After section 465A insert—
In section 809A (overview of Chapter), omit “or are not ordinarily UK resident”.
In section 465 (overview of Chapter 2 and interpretation), in subsection (4), omit “and ordinary residence”.
In section 98 (special returns etc), in subsection (4E)(d), omit “ordinarily”. The amendment made by this paragraph takes effect on the coming into force of regulations made under section 17(3) of F(No.2)A 2005 (authorised investment funds) by virtue of the amendment made by paragraph 136.
Paragraph 52 (recovery of excessive overpayments etc) is amended as follows. In sub-paragraph (2), after paragraph (bd) insert—. In sub-paragraph (5)—
In Part 13 of CTA 2009 (additional relief for expenditure on research and development), after section 1040 insert—
After section 162 insert—
In ITTOIA 2005, for section 832A substitute—
In section 468 (non-UK resident trustees and foreign institutions), after subsection (6) insert—
In section 809B (claim for remittance basis to apply)—
in subsection (1)(b), omit “or is not ordinarily UK resident in that year”, and
omit subsection (2).
Section 475 (residence of trustees) is amended as follows. For subsection (1) substitute— In subsection (2), for “both UK resident and ordinarily UK resident” substitute “UK resident”. In subsection (3), for “both non-UK resident and not ordinarily UK resident” substitute “non-UK resident”.
In Schedule 1A (claims etc not included in returns), in paragraph 2(6), omit “or not ordinarily resident”.
Part 9D (claims for film tax relief) is amended as follows. In paragraph 83S (introduction), for “film tax relief” substitutethe following reliefs— The heading of that Part becomes “ Claims for tax relief under Part 15, 15A or 15B of the Corporation Tax Act 2009 ”.
Part 15 of CTA 2009 (film tax relief) is amended as follows.
After section 175 (estate on death: liability to make future payments etc) insert—
In section 514 (chargeable events where transaction-related calculations show gains), after subsection (4) insert—
In section 809D (application of remittance basis without claim where unremitted foreign income and gains under £2,000)—
in subsection (1)(b), omit “or is not ordinarily UK resident in that year”, and
in subsection (1A), omit “the individual is not domiciled in the United Kingdom in that year and”.
Section 476 (how to work out whether settlor meets condition C) is amended as follows. In subsection (2)(b), omit “, ordinarily UK resident”. In subsection (3)(b), omit “, ordinarily UK resident”. The amendment made by sub-paragraph (2) does not apply if the person died before 6 April 2013. The amendment made by sub-paragraph (3) does not apply if the settlement was made before 6 April 2013.
In section 1195 (availability and overview of film tax relief), after subsection (3) insert—
In section 541 (calculation of deficiencies), in subsection (4)(b), after “that section” insert “or formed part of the total income of that individual by virtue of section 465B for the tax year mentioned in section 539(1)”.
In section 809E (application of remittance basis without claim: other cases), in subsection (1)(b), omit “or is not ordinarily UK resident in that year”.
In section 643 (non-residents), in subsection (1), omit “and is not ordinarily UK resident during that year”.
Section 1206 (confidentiality of information) is amended as follows. In subsection (1), for the words from “Schedule 1” to the end substitute “ any of the provisions listed in subsection (1A) ”. After subsection (1) insert— In subsection (2), for “UK Film Council” substitute “ British Film Institute ”. After that subsection insert— In subsection (3)—
In section 552 of ICTA (information: duties of insurers), in subsection (13), for “section 541A” substitute “section 465B or 541A”.
In section 718 (meaning of “person abroad” etc), in subsection (2)(b), for “neither UK resident nor ordinarily UK resident” substitute “non-UK resident”.
In section 1310 of CTA 2009 (orders and regulations), subsection (4) is amended as follows. Omit the “or” at the end of paragraph (e) and after that paragraph insert—.
In section 720 (charge to tax on income treated as arising under section 721), in subsection (1), omit “ordinarily”.
Schedule 4 to CTA 2009 (index of defined expressions) is amended as follows. the company (in Chapter 5 of Part 15A) section 1216E(1) company tax return (in Part 15A) section 1216AJ the completion period (in Chapter 5 of Part 15A) section 1216E(1) co-producer (in Part 15A) section 1216AI core expenditure (in Part 15A) section 1216AG(3) costs of the relevant programme (in Chapter 2 of Part 15A) section 1216BC final certificate (in Chapter 5 of Part 15A) section 1216CC income from the relevant programme (in Chapter 2 of Part 15A) section 1216BB interim accounting period (in Chapter 5 of Part 15A) section 1216E(1) interim certificate (in Chapter 5 of Part 15A) section 1216CC principal photography (in Part 15A) section 1216AF(2) production expenditure (in Part 15A) section 1216AG(2) qualifying co-production (in Part 15A) section 1216AI qualifying expenditure (in Chapter 3 of Part 15A) section 1216CF(3) relevant programme (in Part 15A) section 1216AB the separate programme trade (in Chapters 2, 3 and 5 of Part 15A) section 1216B(3) special television relief (in Chapter 5 of Part 15A) section 1216E(1) television production activities (in Part 15A) section 1216AF television production company (in Part 15A) section 1216AE television programme (in Part 15A) section 1216AA television tax relief (in Part 15A) section 1216C(2) UK expenditure (in Part 15A) section 1216AH the company (in Chapter 5 of Part 15B) section 1217E(1) company tax return (in Part 15B) section 1217AF the completion period (in Chapter 5 of Part 15B) section 1217E(1) core expenditure (in Part 15B) section 1217AD costs of the video game (in Chapter 2 of Part 15B) section 1217BC final certificate (in Chapter 5 of Part 15B) section 1217CC income from the video game (in Chapter 2 of Part 15B) section 1217BB interim accounting period (in Chapter 5 of Part 15B) section 1217E(1) interim certificate (in Chapter 5 of Part 15B) section 1217CC qualifying expenditure (in Chapter 3 of Part 15B) section 1217CF(3) the separate video game trade (in Chapters 2, 3 and 5 of Part 15B) section 1217B(3) special video games relief (in Chapter 5 of Part 15B) section 1217E(1) UK expenditure (in Part 15B) section 1217AE video game (in Part 15B) section 1217AA video games development activities (in Part 15B) section 1217AC video games development company (in Part 15B) section 1217AB video games tax relief (in Part 15B) section 1217C(2)
Section 721 (individuals with power to enjoy income as a result of relevant transactions) is amended as follows. In subsection (1), for “conditions A and B” substitute “conditions A to C”. After subsection (3) insert— In subsection (5), for paragraph (b) substitute—.
In section 727 (charge to tax on income treated as arising under section 728), in subsection (1), omit “ordinarily”.
Section 728 (individuals receiving capital sums as a result of relevant transactions) is amended as follows. In subsection (1)— In subsection (3), for paragraph (b) substitute—.
In section 732 (non-transferors receiving benefit as a result of relevant transactions), in subsection (1)(b), for “ordinarily UK resident receives a benefit” substitute “UK resident for a tax year receives a benefit in that tax year”.
In section 749 (restrictions on particulars to be provided by relevant lawyers), in subsection (2), omit “ordinarily”. The amendment made by this paragraph applies only if the transfer is made or, in the case of an associated operation, the transfer is made and the associated operation is effected on or after 6 April 2013.
In section 812 (case where limit on liability of non-UK residents is not to apply), in subsection (1)(a), omit “ordinarily”.
In section 834 (residence of personal representatives), in subsection (3), omit “, ordinarily UK resident”. The amendment made by this paragraph does not apply if D died before 6 April 2013.
In section 858 (declarations of non-UK residence: individuals)— The amendments made by this paragraph apply to the making of declarations on or after 6 April 2014, and any declarations made before that date continue to have effect in respect of interest paid on or after that date as if those amendments had not been made.
In section 859 (declarations of non-UK residence: Scottish partnerships)— The amendments made by this paragraph apply to the making of declarations on or after 6 April 2014, and any declarations made before that date continue to have effect in respect of interest paid on or after that date as if those amendments had not been made.
In section 860 (declarations of non-UK residence: personal representatives), in subsection (3), for “not ordinarily UK resident” substitute “non-UK resident”. The amendment made by this paragraph applies only if the deceased died on or after 6 April 2014.
Section 861 (declarations of non-UK residence: settlements) is amended as follows. In subsection (3)(b)(i) and (iii), omit “ordinarily”. In subsection (4)— The amendments made by this paragraph apply to the making of declarations on or after 6 April 2014, and any declarations made before that date continue to have effect in respect of interest paid on or after that date as if those amendments had not been made.
In section 519 (no charge in respect of exercise of option) after subsection (3) insert—
In Part 3 of Schedule 4 (eligibility of individuals) in paragraphs 10(2) and (3), 11(3) and (4) and 13(2) (which relate to the “no material interest” requirement) for “25%” substitute “ 30% ”. The amendments made by this paragraph have effect for the purpose of determining whether a person is eligible to participate in a scheme on the day on which this Act is passed or any later day (by altering what constitutes a material interest on that day and within the 12 months preceding that day). A CSOP scheme approved before the day on which this Act is passed has effect with any modifications needed to reflect the amendments made by this paragraph.
Part 2 of ITTOIA 2005 (trading income) is amended as follows.
After Chapter 17 insert—
Chapter 2 of Part 7 of ITTOIA 2005 (qualifying care relief) is amended as follows.
Section 721 (individuals with power to enjoy income as a result of a relevant transaction) is amended as follows. In subsection (3) after “the income” insert “ of the person abroad ”. Before subsection (4) insert— In subsection (4) after “the income” insert “ of the person abroad ”. Omit subsection (5)(a).
In section 874 of ITA 2007 (duty to deduct from certain payments of yearly interest), after subsection (6) insert—
TCGA 1992 is amended as follows.
ITA 2007 is amended as follows. Omit the following provisions (which deal with deemed manufactured payments and repos)— In Schedule 1 (minor and consequential amendments), omit paragraphs 310, 543 and 544. In Schedule 2 (transitionals and savings), omit paragraphs 112 to 124. In Schedule 4 (index of defined expressions)—
Subject to sub-paragraph (2), the amendments made by this Schedule have effect for the tax year 2013-2014 and subsequent tax years. Chapter 2A of Part 4 of ITTOIA 2005 does not apply in relation to an arrangement that produces a return for a person, in relation to an amount, which is economically equivalent to interest if—
In section 662 (exemption from corporation tax for UK trading income), after subsection (5) insert—
The amendments made by this Schedule have effect in relation to a qualifying change if the relevant day (within the meaning of Chapter 16A of Part 2 of CAA 2001) is on or after 20 March 2013. But those amendments do not have effect if before that date—
VATA 1994 is amended as follows.
The amendments made by paragraphs 2 to 4 come into force in relation to prescribed accounting periods beginning on or after 1 February 2014. Subject to that, section 56 of VATA 1994 has effect on and after 11 December 2012 as if in subsection (2) of that section for the words after “it is supplied” there were substituted “for consideration.”
In this Schedule a “designated HMRC officer” means an officer of Revenue and Customs who has been designated by the Commissioners for the purposes of the general anti-abuse rule.
Part 6 of Schedule 3 (requirements etc relating to share options) is amended as follows.
In section 805 (meaning of “qualifying care receipts”), after subsection (3) insert—
Section 724 (special rules where benefit provided out of income of person abroad) is amended as follows. In subsection (2) after “on” insert “ an amount equal to ”. In subsection (3)—
In section 37 (consideration chargeable to tax on income), after subsection (2) insert—
In section 663 (exemption from corporation tax for UK property income), after subsection (5) insert—
The amendment made by paragraph 6 is to be treated as coming into force on 11 December 2012 and has effect in relation to— “The commencement day” means the day on which this Act is passed.
Paragraph 34 (exercise of options: scheme-related employment ends) is amended as follows. In sub-paragraph (2)— In sub-paragraphs (4) and (5A)(b) for “or (b)” substitute “ to (d) ”. A SAYE option scheme approved before the day on which this Act is passed has effect with any modifications needed to reflect the amendments made by this paragraph.
In section 820 (periods of account not ending on 5th April)—
the existing provision becomes subsection (1), and
after that subsection insert—
Section 725 (reduction in amount charged where controlled foreign company involved) is amended as follows. In subsection (1), as substituted by paragraph 22 of Schedule 20 to FA 2012, for paragraph (b) and the “ and ” before it substitute— After subsection (2) insert— In relation to cases in which the amendments made by paragraph 22 of Schedule 20 to FA 2012 are to be ignored in accordance with paragraph 50(9) of that Schedule, the amendment made by sub-paragraph (5) below has effect instead of the amendment made by sub-paragraph (2) above. In subsection (1) for paragraph (c) and the “and” before it substitute—
In section 39 (exclusion of expenditure by reference to tax on income), after subsection (3) insert—
Paragraph 37 (exercise of options: company events) is amended as follows. After sub-paragraph (3) insert— A SAYE option scheme approved before the day on which this Act is passed which contains provision under paragraph 37(1) of Schedule 3 to ITEPA 2003 by reference to paragraph 37(2) has effect with any modifications needed to reflect the amendment made by sub-paragraph (2). In sub-paragraph (4) for the words from “proposed” to the end substituteapplicable to or affecting— A SAYE option scheme approved before the day on which this Act is passed which contains provision under paragraph 37(1) of Schedule 3 to ITEPA 2003 by reference to paragraph 37(4) has effect with any modifications needed to reflect the amendment made by sub-paragraph (4). In sub-paragraph (6)— A SAYE option scheme approved before the day on which this Act is passed which contains provision under paragraph 37(6) of Schedule 3 to ITEPA 2003 has effect with any modifications needed to reflect the amendments made by sub-paragraph (6).
In section 726 (non-UK domiciled individuals to whom remittance basis applies) in subsection (2) for “the extent” substitute “ the corresponding extent ”.
Omit sections 148A to 148C (provision dealing with the capital gains tax consequences of Chapter 12 of Part 4 of ITTOIA 2005).
In Part 7 of Schedule 3 (exercise of share options) paragraph 38 (exchange of options on company reorganisation) is amended as follows. In sub-paragraph (2)(c)— After sub-paragraph (2) insert— A SAYE option scheme approved before the day on which this Act is passed which contains provision under paragraph 38 of Schedule 3 to ITEPA 2003 has effect with any modifications needed to reflect the amendments made by this paragraph.
Section 728 (individuals receiving capital sums as a result of a relevant transaction) is amended as follows. After subsection (1) insert— In subsection (2) for the words from “it applies” to the end substituteif— After subsection (2) insert— Omit subsection (3)(a).
Section 263A (agreements for sale and repurchase of securities) is amended as follows. Before subsection (1) insert— In subsection (1), for the words from “falling” to “repos)” substitute “ where under a repo in respect of securities the original owner has transferred the securities to the interim holder ”. Omit subsection (5).
In section 730 (non-UK domiciled individuals to whom remittance basis applies) in subsection (2) for “the extent” substitute “ the corresponding extent ”.
After section 263A insert—
Section 743 (no duplication of charges) is amended as follows. After subsection (2) insert— In subsection (3) for “subsections (1) and (2)” substitute “ this section ”. Omit subsection (4).
Section 263F (power to modify repo provisions: non-standard repo cases) is amended as follows. In subsection (2), for the words from “cases” to the end substitute “ any case mentioned in section 263A(1). ” For subsection (9) substitute—
Section 744 (meaning of taking income into account in charging income tax for section 743) is amended as follows. In subsection (1) for “743(1) and (2)” substitute “ 743 ”. In subsection (2)— In subsection (3) for “that income” substitute “ the income mentioned in section 728(1)(a) ”.
In section 263G (power to modify repo provisions: redemption arrangements)—
in subsection (2), for the words from “cases” to the end substitute “ any case mentioned in section 263A(1). ”, and
omit subsection (4).
Section 745 (rates of tax applicable to income charged under sections 720 and 727 etc) is amended as follows. In subsection (1) for “so far as it” substitute “ if (and to the corresponding extent that) the income mentioned in section 721(2) or 728(1)(a) ”. For subsections (3) and (4) substitute—
In section 746 (deductions and reliefs where individual charged under section 720 or 727) for subsection (2) substitute—
The amendment made by subsection (2) above has effect for the purpose of disallowing deductions for relevant accounting periods. For this purpose, it does not matter if the acquisition of shares which gives rise, or would give rise, to the relief under Part 12 of CTA 2009 occurs before a company's first relevant accounting period.
But the amendment made by subsection (2) above has no effect for the purpose of disallowing a deduction for a pre-20 March 2013 relevant accounting period where the acquisition of shares which gives rise, or would give rise, to the relief under Part 12 of CTA 2009 occurs before 20 March 2013.
The amendment made by subsection (3) above has effect for the purpose of disallowing deductions for relevant accounting periods. For this purpose, it does not matter if the option is obtained before a company's first relevant accounting period.
But the amendment made by subsection (3) above has no effect for the purpose of disallowing a deduction for a pre-20 March 2013 relevant accounting period where—
the option is obtained before 20 March 2013, and
before that date, an event (for example, the lapse or cancellation of the option) occurs in consequence of which the shares cannot be acquired pursuant to the option.
Chapter 7 of Part 7 of CTA 2009 (chargeable gains arising in relation to derivative contracts) is amended as follows.
In section 643 (contracts relating to land or certain tangible movable property)—
in subsection (1), for “and C” substitute “ , C and D ”, and
after subsection (4) insert—
In section 650 (property based total return swaps)—
in subsection (1), for “to F” substitute “ to H ”, and
after subsection (7) insert—
In section 659 (meaning of “relevant credits” and “relevant debits”), after subsection (4) insert—
The amendments made by this section have effect in relation to accounting periods beginning on or after 5 December 2012.
But, for the purposes of subsection (5), an accounting period beginning before, and ending on or after, 5 December 2012 is to be treated as if so much of the period as falls before that date, and so much of the period as falls on or after that date, were separate accounting periods.
Schedule 20 contains provision about tax mismatch schemes.
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CTA 2010 is amended as follows.
In section 162 (meaning of “normal commercial loan”), after subsection (1) insert—
After section 164 insert—
In section 1029(1) (overview), after paragraph (c) insert—.
After section 1032 insert—
The amendments made by this section are treated as having come into force on 26 October 2012.
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In section 316 of TIOPA 2010 (group treasury companies) for subsections (2) to (8) substitute—
The amendment made by this section has effect in relation to periods of account of the worldwide group beginning on or after 11 December 2012.
In section 1158(2) of CTA 2010 (condition A for a company to be an “investment trust”), for “the business of the company consists of” substitute “ all, or substantially all, of the business of the company is ”.
The amendment made by this section has effect in relation to accounting periods beginning on or after 1 January 2012.
Schedule 21 contains provision about community amateur sports clubs.
Part 2 of Schedule 18 to FA 2011 (lifetime allowance charge: commencement and transitional provision relating to changes made for the tax year 2012-13 and onwards) is amended as follows.
In paragraph 14—
omit sub-paragraphs (2) and (15) to (17) (which confer power on the HMRC Commissioners to make provision specifying how notices under paragraph 14 are to be given),
in sub-paragraph (7) omit “the annual rate of” where it first appears, and
in sub-paragraph (11) after “(5)(a)” insert “ and (c)(i) ”.
After paragraph 14 insert—
The amendments made by subsection (2)(b) and (c) are treated as having come into force on 6 April 2012.
The Registered Pension Schemes (Lifetime Allowance Transitional Protection) Regulations 2011 (S.I. 2011/1752) are to continue to have effect and, so far as they were made under paragraph 14(2) and (15) of Schedule 18 to FA 2011, are to be treated as if they were made under paragraphs 16 and 17(1) of that Schedule (as inserted by subsection (3) above).
Section 218 of FA 2004 (standard lifetime allowance etc) is amended as follows.
For subsection (2) substitute—
In subsection (3) for “the tax year 2012-13” substitute “ the tax year 2014-15 ”.
The amendments made by subsections (2) and (3) have effect for the tax year 2014-15 and subsequent tax years.
Schedule 22 contains transitional provision etc.
Section 228 of FA 2004 (annual allowance) is amended as follows.
For subsection (1) substitute—
In subsection (2) for “2011-12” substitute “ 2014-15 ”.
The amendments made by this section have effect for the tax year 2014-15 and subsequent tax years.
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In Schedule 16 to FA 2011 (benefits under pension schemes)—
in paragraph 90(2)(a), after “year” insert “ beginning before 26 March 2013 and ”,
in paragraph 90(3), omit paragraph (b) and the “and” before it,
in paragraph 98(2)(a), after “year” insert “ beginning before 26 March 2013 and ”, and
in paragraph 98(3), omit paragraph (b) and the “and” before it.
The amendments made by subsections (1) and (2) have effect in relation to drawdown pension years beginning on or after 26 March 2013.
The amendments made by subsection (3)(a) and (c) are treated as having come into force on 26 March 2013.
The amendments made by subsection (3)(b) and (d) have effect in relation to transfers within paragraph 90(5) or 98(5) of Schedule 16 to FA 2011 occurring during a drawdown pension year ending on or after 25 March 2013.
FA 2004 is amended as follows.
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in sub-paragraph (4)(c)—
for the words from “not earlier” to “65” substitute “during the permitted period”, and
after “which” insert “together with any previous reductions of the kind referred to in this paragraph (c)”, and
In sub-paragraph (4)(c) “the permitted period” means the period beginning with the day on which the member reaches the age of 60 and ending with the day on which the member reaches the age of 65 or, if later, reaches pensionable age.
In paragraph 1 of Schedule 29 (pension commencement lump sums), in sub-paragraph (4)(a), omit the words from “at a time” to “65”.
In consequence of subsection (3), paragraph 21 of Schedule 23 to the FA 2006 is repealed.
The amendments made by this section have effect for the tax year 2013-14 and subsequent tax years.
FA 2004 is amended as follows.
In section 188 (relief for contributions), in subsection (3) (contributions excluded from relief), omit paragraph (c) and the word “and” immediately preceding that paragraph.
In that section, omit subsection (6) (which treats certain amounts recovered by individual's employer as contributions paid by individual).
Omit section 190(5) (certain reliefs not to count towards annual limit for relief).
Omit section 196(5) (references to contributions to include references to minimum payments when determining relief for employers).
Omit section 202 (minimum contributions under pensions legislation).
Omit section 233(2) (references to contributions not to include references to minimum payments when determining pension input amount).
In sub-paragraph (2) the reference to the member's contributions includes— Those regulations are regulations which were made under—
Omit paragraph 14(2) of Schedule 36 (which excludes minimum payments from being relevant contributions for the purposes of enhanced protection from lifetime allowance charge).
Subsections (1), (3) to (5) and (7) to (9) come into force on 6 April 2013.
Subsection (2) comes into force on 6 April 2015.
Subsection (6) comes into force on 6 April 2016, except that the repeal of section 202(5) of FA 2004 comes into force on such day as the Treasury may appoint by order made by statutory instrument.
In section 150(8) of FA 2004 (meaning of “recognised overseas pension scheme”), for the words from “which” to the end substitute “ which satisfies any requirements prescribed for the purposes of this subsection by regulations made by the Commissioners for Her Majesty's Revenue and Customs. ”
Section 169 of that Act (pension schemes: recognised transfers) is amended as follows.
In subsection (2)(c), for “any prescribed information requirements imposed on the scheme manager” substitute “ any requirements imposed under subsection (4) ”.
For subsection (4) substitute—
In subsection (5)—
for “the Inland Revenue has” substitute “ the Commissioners have ”,
for paragraph (a) (but not the “and” at the end of it) substitute—, and
in paragraph (b), for “the failure” substitute “ that condition being met ”.
For subsection (6) substitute—
After subsection (7) insert—
“FA 2008” means the Finance Act 2008,
Part 6 of Schedule 36 to FA 2008 (information and inspection powers: special cases) is amended as follows.
In paragraph 34B (registered pension schemes etc)—
in sub-paragraph (2), omit the “or” at the end of paragraph (b) and, at the end of paragraph (c) insert—;
after sub-paragraph (4) insert—;
after sub-paragraph (7) insert—;
in sub-paragraph (8), for “and (7)” substitute “ to (7A) ”.
“QROPS” and “former QROPS” have the meanings given by section 169(8) of FA 2004; “ “scheme manager”, in relation to a pension scheme, has the meaning given by section 169(3) of FA 2004.
In paragraphs 34B and 34C of Schedule 36 to FA 2008, references to a former QROPS include a scheme that ceased to be a QROPS before this Act was passed.
Schedule 23 contains—
provision about employee shareholder shares, and
provision for an exemption from income tax in connection with advice relating to proposed employee shareholder agreements.
ITA 2007 is amended as follows.
In section 29 (tax reductions: supplementary), in subsection (4B), after the entry for Chapter 1 of Part 5 insert— “ Chapter 1 of Part 5A (SEIS relief), ”.
In section 32 (liability not dealt with in the calculation), after the entry for section 235 insert— “ under section 257G (withdrawal or reduction of SEIS relief), ”.
In section 257DG (the control and independence requirement), for subsection (2) substitute—
The amendments made by subsections (2) and (3) have effect for the tax year 2013-14 and subsequent tax years.
The amendment made by subsection (4) has effect in relation to shares issued on or after 6 April 2013.
Schedule 5BB to TCGA 1992 (seed enterprise investment scheme: re-investment) is amended as follows.
In paragraph 1 (SEIS re-investment relief)—
in sub-paragraph (2)—
in paragraph (a), after “the tax year 2012-13” insert “ or the tax year 2013-14 (the year in question being referred to in this Schedule as “the relevant year”) ”, and
in paragraph (b), for “that year” substitute “ the relevant year ”,
in sub-paragraph (3)(a), for “tax year 2012-13” substitute “ relevant year ”, and
for sub-paragraph (5) substitute—
In paragraph 2 (restrictions on relief under paragraph 1)—
in sub-paragraph (1), for “tax year 2012-13” substitute “ relevant year ”, and
in sub-paragraph (2)—
for “tax year 2012-13” substitute “ relevant year ”, and
for “that tax year” substitute “ that year ”.
In paragraph 5 (removal or reduction of relief) in sub-paragraph (2) for “2012-13” substitute “ in which the shares were issued ”.
Accordingly, in section 150G of TCGA (which introduces Schedule 5BB), for “tax year 2012-13” substitute “ tax years 2012-13 and 2013-14 ”.
A claim for relief under this section (“disincorporation relief”) may be made where—
a company transfers its business to some or all of the shareholders of the company,
the transfer of the business is a qualifying business transfer (see section 59), and
the business transfer date falls within the period of 5 years beginning with 1 April 2013.
As to the consequences of a claim for disincorporation relief being made, see— sections 162B and 162C of TCGA 1992; section 849A of CTA 2009.
In this section and sections 59 to 61 “the business transfer date”, in relation to the transfer of a business, is the date on which the business is transferred. For this purpose, where the business is transferred under a contract—
the date on which the business is transferred is to be determined in accordance with section 28 of TCGA 1992, and
if the business in question is transferred by more than one contract, then for the purposes of that section the contract under which the business is transferred is to be taken to be the contract under which the goodwill of the business is transferred.
This section and sections 59 and 60 apply to a transfer of a business with a business transfer date of 1 April 2013 or a later date.
The transfer of a business from a company to some or all of the shareholders of the company is a qualifying business transfer for the purposes of section 58 if conditions A to E are met.
Condition A is that the business is transferred as a going concern.
Condition B is that the business is transferred together with all of the assets of the business, or together with all of those assets other than cash.
Condition C is that the total market value of the qualifying assets of the business included in the transfer does not exceed £100,000.
Condition D is that all of the shareholders to whom the business is transferred are individuals.
Condition E is that each of those shareholders held shares in the company throughout the period of 12 months ending with the business transfer date.
For the purposes of condition D, the reference to individuals includes an individual acting as a member of a partnership, but does not include an individual acting as a member of a limited liability partnership.
Section 60 of TCGA 1992 (nominees and bare trustees) applies for the purposes of this section as it applies for the purposes of that Act.
In this section “market value”, in relation to an asset, means the price which the asset might reasonably be expected to fetch on a sale in the open market.
In this section a “qualifying asset” means—
goodwill, or
an interest in land which is not held as trading stock.
A claim for disincorporation relief under section 58—
is to be made jointly by the company and all of the shareholders to whom the business is transferred, and
is irrevocable.
Any claim for disincorporation relief must be made within the period of 2 years beginning with the business transfer date.
In Part 5 of TCGA 1992 (transfer of business assets), in Chapter 1 (general provisions), after section 162A insert—
In Part 8 of CTA 2009 (intangible fixed assets), Chapter 13 (transactions between related parties) is amended as follows.
In section 844 (overview of Chapter), in subsection (2) for “849” substitute “ 849A ”.
In section 845 (transfer between company and related party treated as at market value), in subsection (4) (exceptions to basic rule)—
omit the “and” at the end of paragraph (ca), and
after paragraph (d) insert, and
After section 849 insert—
The amendments made by this section have effect in relation to a transfer of a business with a business transfer date of 1 April 2013 or a later date.
TCGA 1992 is amended as follows.
In subsection (4) of section 13 (members to whom rule for attributing gains to members of non-resident companies does not apply), for “one tenth” substitute “ one quarter ”.
In subsection (5) of that section (cases where rule for attributing gains to members of non-resident companies does not apply), after the “or” at the end of paragraph (b) insert—.
After section 13 insert—
The amendments made by this section have effect in relation to disposals made on or after 6 April 2012.
But, in the case of a disposal made on or after that date but before 6 April 2013, a person to whom a part of a chargeable gain or allowable loss would (but for the amendments made by this section) have accrued on the disposal may make an election in writing for section 13 of TCGA 1992 to apply in relation to the disposal without those amendments.
An election under subsection (6) in respect of a disposal must be made—
in the case of a person within the charge to capital gains tax, within 4 years from the end of the tax year in which the disposal was made, and
in the case of a person within the charge to corporation tax, within 4 years from the end of the accounting period in which the disposal was made.
In section 169D of TCGA 1992 (gifts to settlor-interested settlements etc: exceptions to sections 169B and 169C), in subsection (1), after “elected” insert “ , or could have elected, ”.
The amendment made by this section has effect for the tax year 2012-13 and subsequent tax years.
Schedule 24 makes provision for capital gains tax purposes in connection with shares acquired under options which are qualifying options under the EMI code.
Schedule 25 contains provision for a new capital gains tax charge on gains accruing to companies etc on certain high value disposals.
Chapter 4 of Part 2 of CTA 2010 (currency) is amended as follows.
In section 5 (basic rule: sterling to be used), after subsection (2) insert—
After section 9B insert—
The amendments made by this section come into force in accordance with provision made by the Treasury by order.
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Section 45AA of CAA 2001 (section 45A exclusion: payments under Energy Act 2008 schemes) is amended as follows.
In subsection (1)—
in paragraph (a), after “(feed-in tariffs)” insert “, or under a corresponding scheme having effect in Northern Ireland,”, and
in paragraph (b), after “of that Act” insert “or section 113 of the Energy Act 2011”.
In subsection (5), for “subsection (6)” substitute “subsections (5A) and (6)”.
After that subsection insert—
In the heading, for “payments under Energy Act 2008 schemes” substitute “feed-in tariffs and renewable heat incentives”.
In section 45D of CAA 2001 (first year qualifying expenditure on cars with low carbon dioxide emissions)—
in subsection (1)(a), for “2013” substitute “2015”, and
in subsection (4), for “110” substitute “95”.
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In section 104AA of that Act (special rate expenditure: meaning of “main rate car”), in subsection (4) for “160” substitute “130”.
Accordingly, in section 77 of FA 2008 omit—
subsection (2), and
subsection (3).
The amendments made by subsections (1)(b), (2) and (4)(b) have effect in relation to expenditure incurred on or after 1 April 2013.
The amendment made by subsection (3) has effect in relation to expenditure incurred on or after the relevant date.
But in relation to expenditure incurred on the hiring of a car— section 49(1A) of ITTOIA 2005 and section 57(1A) of CTA 2009 apply on or after the relevant date as if the amendment made by subsection (3) did not have effect.
for a period of hire which begins before the relevant date, and
under a contract entered into before that date,
“The relevant date” means—
in the case of income tax, 6 April 2013, and
in the case of corporation tax, 1 April 2013.
In section 45E(1)(a) of CAA 2001 (time limit for incurring of expenditure qualifying for first-year allowance), for “2013” substitute “ 2015 ”.
In section 46(2) of CAA 2001 (general exclusions from first-year allowance), omit— and the italicised headings preceding them.
general exclusion 3 (ships), and
general exclusion 4 (railway assets),
The amendments made by this section have effect for expenditure incurred on or after 1 April 2013.
Schedule 26 contains provision amending Chapter 16A of Part 2 of CAA 2001 (restrictions on allowance buying).
In section 268D of CAA 2001 (hire cars for disabled persons), in subsection (2), after paragraph (a) insert—.
The amendment made by this section has effect in relation to expenditure incurred on or after 1 April 2013.
Section 538 of CAA 2001 (contribution allowances: plant and machinery) is amended as follows.
In subsection (1), omit the “and” at the end of paragraph (a) and after that paragraph insert—.
In subsection (2)—
in paragraph (a), for “asset provided by means of C's contribution” substitute “ plant or machinery ”,
in paragraph (b), for “asset” substitute “ plant or machinery ”, and
in paragraph (c)—
for “asset” substitute “ plant or machinery ”, and
after “times” insert “ plant or machinery ”.
The amendments made by this section have effect in relation to expenditure pooled, and to claims made, on or after 29 May 2013 (“the commencement date”).
In relation to such expenditure and claims, when determining for the purposes of section 536(3)(a) of CAA 2001 whether an allowance can be made under Chapter 2 of Part 11 of that Act, the amendments made by this section are to be treated as always having had effect.
Nothing in this section applies to a claim by a person for a contribution allowance under Part 2 of CAA 2001 in respect of a contribution made before the commencement date.
Subsection (8) applies if—
expenditure which a person has been regarded as having incurred (despite section 532(1) of CAA 2001) by virtue of section 536(1) of that Act has been pooled by virtue of section 53 of that Act—
on or after 1 January 2013 but before the commencement date, or
before 1 January 2013 in circumstances where no claim was made in respect of the expenditure before that date, and
had the amendments made by this section had effect at the time the expenditure was incurred, that person would not have been regarded as having incurred that expenditure (“the relevant expenditure”).
Part 2 of CAA 2001 has effect as if an event had occurred as a result of which the person is required to bring into account as a disposal receipt under that Part, for the chargeable period in which the commencement date falls, a disposal value of an amount equal to E-A.
For the purposes of subsection (8)— E is the amount of the relevant expenditure, and A is the total amount of writing-down allowances made in respect of the relevant expenditure.
“pre-claim period” has the same meaning as in section 100;
Part 4 of Schedule 3 (shares to which schemes can apply) is amended as follows.
In Schedule 24 to FA 2007 (penalties for errors), in paragraph 28(fa) (definition of “corporation tax credit”), after sub-paragraph (i) insert—.
Section 212B (circumstances where Chapter 16A applies) is amended as follows. For subsection (1)(d) substitute— For subsection (4) substitute—
The following amendments are in consequence of, or otherwise connected with, the amendments made by Parts 1 and 2.
ITTOIA 2005 is amended as follows.
CTA 2009 is amended as follows.
In Schedule 6 (valuation: special cases), before paragraph 1 insert—PART 2.
IHTA 1984 is amended as follows.
This Part of this Schedule sets out the rules for determining for the purposes of relevant tax whether individuals are resident or not resident in the UK. The rules are referred to collectively as “the statutory residence test”. The rules do not apply in determining for the purposes of relevant tax whether individuals are resident or not resident in England, Wales, Scotland or Northern Ireland specifically (rather than in the UK as a whole). “Relevant tax” means— Key concepts used in the rules are defined in Part 2 of this Schedule.
In paragraph 17 (introduction) in sub-paragraph (1)—
after the entry for paragraph 20 insert “ and ”, and
omit the entry for paragraph 21 and the “and” after it.
After section 212L insert—
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
In section 539 (introduction to Chapter about manufactured interest), omit subsection (7).
In paragraph 6 of that Schedule (valuation of supplies of goods by virtue of paragraph 5(1) of Schedule 4 etc), in sub-paragraph (1), after “except where” insert “the person making the supply opts under paragraph A1(3) above for valuation on the flat-rate basis or”.
Section 71A (trusts for bereaved minors) is amended as follows. For subsection (3)(c)(ii) substitute— In subsection (4), before paragraph (a) insert—. After subsection (4) insert—
Omit paragraph 21 (only certain kinds of restrictions allowed).
In consequence of the amendments made by paragraphs 2 and 3, the heading to Chapter 16A becomes “ Restrictions on allowance buying ”.
In section 397A (tax credit for distributions of non-UK resident companies)—
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
omit subsection (8).
In section 540(3) (manufactured interest treated as interest under loan relationship), omit “and to section 799 of CTA 2010”.
Omit sections 56 and 57 (fuel for private use).
Section 71B (charge to tax on property to which section 71A applies) is amended as follows. In subsection (1), after “(2)” insert “, (2B)”. After subsection (2) insert—
At the time a share option is granted— For the purposes of this paragraph the market value of shares subject to a restriction is to be determined as if they were not subject to the restriction.
Omit section 397B (tax credits under section 397A: manufactured overseas dividends).
In section 550 (which makes provision about the effect of the sale of securities on a borrower)—
in subsection (4), for “(6)” substitute “ (5C) ”,
after subsection (5A) insert—, and
omit subsection (6).
In section 97(4) (orders subject to affirmative procedure), in paragraph (f)—
after “paragraph” insert “B1, C1(4),”, and
after “1A(7)” insert “, 2A(4)”.
Section 71D (age 18-to-25 trusts) is amended as follows. For subsection (6)(c)(ii) substitute— After that subsection insert—. In subsection (7), before paragraph (a) insert—. After that subsection insert—
For the purposes of this paragraph the market value of shares subject to a restriction is to be determined as if they were not subject to the restriction.
In section 1221(1) (amounts treated as expenses of management), for paragraph (i) substitute—.
Section 71E (charge to tax on property to which section 71D applies) is amended as follows. In subsection (1), for “(4)” substitute “(4A)”. After subsection (4) insert—
Part 9 of Schedule 3 (supplementary provisions) is amended as follows.
In section 1248 (expenses in connection with arrangements for securing a tax advantage)—
omit subsection (3), and
in subsection (5), omit the definition of “relevant tax relief”.
Section 89 (trusts for disabled persons) is amended as follows. For subsection (1)(b) substitute— For subsection (3) substitute— In subsection (4), for the words following “into settlement,” substitute “was a disabled person”. For subsections (5) and (6) substitute—
In paragraph 48 (minor definitions) after sub-paragraph (2) insert—
Section 89A (self-settlement by person with condition expected to lead to disability) is amended as follows. In subsection (1)(b), for the words following “A becoming” substitute “a person falling within any paragraph of the definition of “disabled person” in paragraph 1 of Schedule 1A to the Finance Act 2005”. In subsection (2), after “settled property” insert “or income arising from it”. For subsections (5) and (6) substitute— Before subsection (7) insert— For subsection (8) substitute— In the heading, for the words following “person” substitute “expected to fall within the definition of “disabled person””.
restriction (in relation to shares) paragraph 48(3)
Section 89B (meaning of “disabled person’s interest”) is amended as follows. For subsection (2) substitute— After that subsection insert—
The amendments made by paragraphs 59 to 62 above have effect in relation to options granted on or after the day on which this Act is passed. The amendment made by paragraph 63 above has effect for cases where the old options are granted on or after that day. A SAYE option scheme approved before that day has effect with any modifications needed to reflect the amendments made by paragraphs 59 to 66 above. In particular, in relation to options granted on or after that day, such a SAYE option scheme has effect with the omission of any provision falling within a provision of Schedule 3 to ITEPA 2003 omitted by paragraph 61 above.
The amendments made by paragraphs 2 to 8 have effect in relation to property transferred into settlement on or after 8 April 2013. Nothing in paragraphs 6 to 8 is to be read as preventing property transferred into a relevant settlement on or after 8 April 2013 from being property to which section 89 or 89A of IHTA 1984 applies.
In section 89B (meaning of “disabled person’s interest”), in subsection (1)(c) after “2006” insert “if the trusts on which the settled property is held secure that, if any of the settled property is applied during the disabled person’s life for the benefit of a beneficiary, it is applied for the benefit of the disabled person”. After that section insert— The amendments made by this paragraph have effect in relation to property transferred into settlement on or after the day on which this Act is passed. Nothing in this paragraph is to be read as preventing property transferred into a settlement to which sub-paragraph (5) applies from being settled property for the purposes of section 89B(1)(c) or (d) of IHTA 1984. This sub-paragraph applies to a settlement—
Part 7 of ITEPA 2003 (employment income: income and exemptions relating to securities) is amended as follows.
For the purposes of this paragraph the market value of shares subject to a restriction is to be determined as if they were not subject to the restriction.
ITA 2007 is amended as follows. In section 23 (calculation of income tax liability) at step 2 for “section 25” substitute “ sections 24A and 25 ”. In the following provisions (which explain how certain reliefs work) for “section 25(4) and (5)” substitute “ sections 24A and 25(4) and (5) ” In section 148 (share loss relief: disposal of shares forming part of mixed holding) in subsection (3)(b) before sub-paragraph (i) insert—.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
The amendments made by this Part of this Schedule have effect for the tax year 2013-14 and subsequent tax years. They have effect in relation to relevant transfers occurring before 6 April 2013 as well as relevant transfers occurring on or after that date.
In Schedule 54A to FA 2009 (further provision as to late payment interest and repayment interest), in paragraph 2(2), omit the “or” at the end of paragraph (d) and after paragraph (e) insert—
The amendments made by this Schedule come into force in accordance with provision contained in an order made by the Treasury. An order under sub-paragraph (1)—
In Schedule 24 to FA 2004 (manufactured dividends), omit paragraph 3(1) and (3).
In Schedule 19 to FA 2009 (income tax credits for foreign distributions), omit paragraphs 4 and 13(b).
In Schedule 13 to FA 2011 (profits of foreign permanent establishments), omit paragraphs 22 to 24.
In Part 2 of ITTOIA 2005 (trading income), Chapter 16A (oil activities) is amended as follows. In section 225N (expenditure on and under abandonment guarantees)— In section 225R (introduction to sections 225S and 225T)—
An officer of Revenue and Customs may correct any obvious error or omission in a return. A correction under this paragraph— The reference in sub-paragraph (1) to an error includes, for instance, an arithmetical mistake or an error of principle. A correction under this paragraph must be made within the 9 months beginning with— A correction under this paragraph has no effect if the chargeable person— A notice is given in the “special period” if it is given— A notice under sub-paragraph (5)(b) must be given to HMRC.
A person who believes that tax has been assessed on that person more than once in respect of the same matter may make a claim to the Commissioners for Her Majesty’s Revenue and Customs for relief against any double charge. Schedule 11A to FA 2003 (claims not included in returns) applies in relation to a claim under sub-paragraph (1) as it applies to a claim such as is mentioned in paragraph 1 of that Schedule.
A claim under paragraph 29 must be made within the period of 4 years after the end of the chargeable period to which the payment by way of tax, or the assessment or determination, relates. A claim under paragraph 29 may not be made by being included in a return. Schedule 11A to FA 2003 (claims not included in returns) applies in relation to a claim under paragraph 29 as it applies to a claim such as is mentioned in paragraph 1 of that Schedule.
In paragraph 29(1)(a) the reference to an amount paid by a person by way of tax includes an amount paid by a person under a contract settlement in connection with tax believed to be due. Sub-paragraphs (3) to (6) apply if the person who paid the amount under the contract settlement (“the payer”) and the person from whom the tax was due (“the taxpayer”) are not the same person. In relation to a claim under paragraph 29 in respect of that amount— Sub-paragraph (5) applies where the grounds for giving effect to a claim by the payer in respect of the amount also provide grounds for a discovery assessment on the taxpayer in respect of any single-dwelling interest. The Commissioners for Her Majesty’s Revenue and Customs may set any amount repayable to the payer as a result of the claim against any amount payable by the taxpayer as a result of the assessment. The obligations of the Commissioners for Her Majesty’s Revenue and Customs and the taxpayer are discharged to the extent of any set-off under sub-paragraph (5). “Contract settlement” means an agreement made in connection with any person’s liability to make a payment to the Commissioners for Her Majesty’s Revenue and Customs under or by virtue of an enactment.
TCGA 1992 is amended as follows.
Part 4 of ITTOIA 2005 (savings and investment income) is amended as follows.
Parts 1 and 2 of this Schedule have effect for determining whether individuals are resident or not resident in the UK for the tax year 2013-14 or any subsequent tax year. Part 3 of this Schedule has effect in calculating an individual’s liability to income tax or capital gains tax for the tax year 2013-14 or any subsequent tax year. Part 4 of this Schedule has effect if the year of departure (as defined in that Part) is the tax year 2013-14 or a subsequent tax year.
Part 4 of Schedule 4 (shares to which schemes can apply) is amended as follows.
Sections 721(3C) and 728(2A) of ITA 2007 (as inserted by paragraphs 10(3) and 14(4) above) have effect only if the income of the person abroad arises to that person on or after 6 April 2013. The amendments made by paragraphs 10(5) and 14(5) above have no effect in relation to income arising to a person abroad before 6 April 2013.
The amendments made by this Schedule have effect in relation to accounting periods beginning on or after the relevant day. “The relevant day” is— For provision about the case where a company has an accounting period beginning before the relevant day and ending on or after that day, see paragraph 3(3) of Schedule 16 or (as the case may be) paragraph 3(4) of Schedule 17.
In Part 8 of CTA 2010 (oil activities), Chapter 4 (calculation of profits) is amended as follows. In section 292 (expenditure on and under abandonment guarantees)— In section 296 (introduction to sections 297 and 298)—
Section 2 (persons and gains chargeable to capital gains tax, and allowable losses) is amended as follows. After subsection (1A) (inserted by Schedule 46 to this Act) insert— In subsection (2)—
In Chapter 1 (introduction), after section 368 insert—
In paragraph 15 (introduction)—
after the entry for paragraph 18 insert “ and ”, and
omit the entry relating to paragraph 19 and the “and” after it.
Section 3A (reporting limits) is amended as follows. In subsection (1)— In subsection (2), after “year of assessment” insert “(or the UK part of such a year)”.
In Chapter 3 (dividends etc from UK resident companies and tax credits etc in respect of certain distributions), after section 401B insert—
Omit paragraph 19 (only certain kinds of restrictions allowed).
Section 12 (non-UK domiciled individuals to whom remittance basis applies) is amended as follows. After subsection (2) insert— In subsection (3), after “that year” insert “or, where applicable, that part of the year”.
In Chapter 4 (dividends from non-UK resident companies), after section 408 insert—
At the time a share option is granted— For the purposes of this paragraph the market value of shares subject to a restriction is to be determined as if they were not subject to the restriction.
In section 13 (attribution of gains to members of non-resident companies), after subsection (3) insert—
In Chapter 5 (stock dividends from UK resident companies), after section 413 insert—
For the purposes of this paragraph the market value of shares subject to a restriction is to be determined as if they were not subject to the restriction.
In section 16 (computation of losses), after subsection (3) insert—
In Chapter 6 (release of loan to participator in close company), after section 420 insert—
Part 8 of Schedule 4 (supplementary provisions) is amended as follows.
In section 16ZB (individual who has made election under section 16ZA: foreign chargeable gains remitted in tax year after tax year in which accrue), in subsection (1)(c), after “tax year” insert “or a part of the applicable tax year”.
In Chapter 8 of Part 5 of that Act (income not otherwise charged), after section 689 insert—
In paragraph 36 (minor definitions) after sub-paragraph (2) insert—
Section 16ZC (individual who has made election under section 16ZA and to whom remittance basis applies) is amended as follows. In subsection (3)— In subsection (7), in the definition of “relevant allowable losses”, after “tax year” insert “or a part of the tax year”.
In Chapter 1 of Part 14 of ITA 2007 (limits on liability to income tax of non-UK residents), after section 812 insert—
restriction (in relation to shares) paragraph 36(3)
In section 86 (attribution of gains to settlors with interest in non-resident or dual resident settlements), in subsection (4)(a), after “the year” insert “or if, as respects the settlor, the year is a split year, in the UK part of that year”.
The amendment made by paragraph 68 above has effect for the purpose of determining whether options may be granted to an individual on or after the day on which this Act is passed; but the amendment is to be ignored in determining the market value of any shares to which an option granted before that day relates. The amendments made by paragraphs 69 to 72 above have effect in relation to options granted on or after that day. The amendment made by paragraph 73 above has effect for cases where the old options are granted on or after that day. A CSOP scheme approved before that day has effect with any modifications needed to reflect the amendments made by paragraphs 68 to 76 above. In particular, in relation to options granted on or after that day, such a CSOP scheme has effect with the omission of any provision falling within a provision of Schedule 4 to ITEPA 2003 omitted by paragraph 71 above.
In section 87 (non-UK resident settlements: attribution of gains to beneficiaries), after subsection (6) insert—
For the purpose of calculating A, the total amount of writing-down allowances made in respect of expenditure on an item of plant or machinery is to be determined as if that item were the only item of plant or machinery in relation to which Chapter 5 of Part 2 of CAA 2001 had effect.
The event mentioned in subsection (8) is not to be regarded as a disposal event for the purposes of section 60(3) of CAA 2001.
Schedule 27 makes provision about community investment tax relief.
Schedule 28 makes provision in relation to relief for lease premiums.
Section 596 of ITA 2007 (deemed manufactured payments: stock lending arrangements) is amended in accordance with subsections (2) and (3).
For subsection (1) substitute—
In subsection (2), for paragraph (a) substitute—.
Section 812 of CTA 2010 (deemed manufactured payments: stock lending arrangements) is amended in accordance with subsections (5) to (7).
For subsection (1) substitute—
In subsection (2), for paragraph (a) substitute—.
After subsection (6) insert—
The amendments made by this section have effect in relation to cases in which a dividend or interest is paid, or is treated as paid, on or after 5 December 2012.
Schedule 29 contains provision for, and in connection with, the application of the Tax Acts to manufactured payment relationships and payments representative of dividends and interest.
In section 31 of ITTOIA 2005 (trade profits: relationship between rules prohibiting and allowing deductions)—
after subsection (1) insert—
after subsection (3) insert—
In section 274 of ITTOIA 2005 (property businesses: relationship between rules prohibiting and allowing deductions)—
after subsection (1) insert—
after subsection (3) insert—
In section 51 of CTA 2009 (trade profits: relationship between rules prohibiting and allowing deductions)—
after subsection (1) insert—, and
after subsection (3) insert—
In section 214 of CTA 2009 (property businesses: relationship between rules prohibiting and allowing deductions)—
after subsection (1) insert—, and
after subsection (3) insert—
The amendments made by this section have effect in relation to deductions in respect of amounts which arise directly or indirectly in consequence of, or otherwise in connection with—
arrangements which are entered into on or after 21 December 2012, or
any transaction forming part of arrangements which is entered into on or after that date.
But those amendments do not have effect where the arrangements are, or any such transaction is, entered into pursuant to an unconditional obligation in a contract made before that date.
“An unconditional obligation” means an obligation which may not be varied or extinguished by the exercise of a right (whether under the contract or otherwise).
Schedule 30 (which makes provision about close companies) has effect.
There are to be paid out of money provided by Parliament any sums which a Minister of the Crown is liable to pay under a decommissioning relief agreement.
A “decommissioning relief agreement” is an agreement which—
is made between a Minister of the Crown and a qualifying company, and
provides that, in such circumstances as are specified in the agreement, if the amount of tax relief in respect of any decommissioning expenditure incurred by that or another qualifying company is less than an amount determined in accordance with the agreement (“the reference amount”), the difference is payable to the company that incurred the expenditure.
“Qualifying company” means—
any company that has at any time carried on a ring fence trade,
any company that is associated with a company carrying on a ring fence trade,
any company that has at any time been associated with a company that was carrying on a ring fence trade at that time, and
in the case of decommissioning expenditure incurred in connection with any plant or machinery, or any land, situated in the UK sector of a cross-boundary field, any company that is a party to a joint operating agreement or unitisation agreement in relation to that field.
For the purposes of subsection (2)(b) the amount of tax relief in respect of any decommissioning expenditure is to be determined in accordance with the agreement; and in making such a determination tax relief in respect of expenditure incurred by the qualifying company that is not decommissioning expenditure may, in such circumstances as are specified in the agreement, be treated as if it were tax relief in respect of decommissioning expenditure.
A payment made to a company under a decommissioning relief agreement is not to be regarded as income or a gain of the company for any purpose of the Tax Acts.
No payment is to be made to a company under a decommissioning relief agreement by reference to the energy (oil and gas) profits levy.
Every decommissioning relief agreement (whenever entered into) is to be read accordingly.
Section 18(1) of CRCA 2005 (restriction on disclosure by Revenue and Customs officials) does not prevent—
disclosure to a Minister of the Crown for the purpose of enabling the Minister of the Crown to determine the extent of any liability under a decommissioning relief agreement, or
disclosure to a company that has rights under a decommissioning relief agreement for the purpose of enabling the company to determine the reference amount.
In this section—
“qualifying termination event” is to be interpreted in accordance with article 63B of the Regulated Activities Order;
ITTOIA 2005 is amended as follows.
Sub-paragraph (2) applies if an officer of Revenue and Customs discovers that— An officer of Revenue and Customs may make an assessment (a “discovery assessment”) in the amount or further amount that ought in the officer’s opinion to be charged in order to make good to the Crown the loss of tax. The functions of an officer of Revenue and Customs under this paragraph are also exercisable by the Commissioners for Her Majesty’s Revenue and Customs.
If the taxpayer has delivered a return in respect of the interest in question for the chargeable period in question, an assessment under paragraph 21 or 22 may only be made in the two cases specified in sub-paragraphs (2) and (3). See also the further restriction in sub-paragraph (7). The first case is where the situation mentioned in paragraph 21(1) or 22(1) was brought about carelessly or deliberately by— The second case is where it could not reasonably have been expected that an officer of Revenue and Customs in possession of the information made available to HMRC before the relevant time would be aware at the relevant time of the situation mentioned in paragraph 21(1) or 22(1). In sub-paragraph (3) “the relevant time” means the time HMRC— For this purpose information is regarded as made available to HMRC if— In sub-paragraph (5)(c) and (d) “relevance” means relevance as regards the situation mentioned in paragraph 21(1) or 22(1). No assessment may be made under paragraph 21 or 22 if—
Notice of an assessment must be served on the taxpayer. The notice must state— After notice of the assessment has been served on the taxpayer, the assessment may not be altered except in accordance with the express provisions of this Part of this Act. Where an officer of Revenue and Customs has decided to make an assessment to tax, and has taken all other decisions needed for arriving at the amount of the assessment, the officer may entrust to some other officer of Revenue and Customs the responsibility for completing the assessing procedure, whether by means involving the use of a computer or otherwise, including responsibility for serving notice of the assessment.
Paragraphs 9 to 12 contain amendments and modifications of Schedule 56 to FA 2009 (penalty for failure to make payments on time).
After paragraph 2 of Schedule 6 insert—
Section 81 (further return where relief withdrawn) is amended as follows. After subsection (1) insert— In subsection (2A), for “Tax” substitute “Where subsection (1) applies any tax”. In subsection (3) for “this section” substitute “subsection (1)”. After subsection (4) insert—
The circumstances of a case fall within Case 1 if they are as described in sub-paragraphs (2) to (4). The taxpayer was resident in the UK for the previous tax year (whether or not it was a split year). There is at least one period (consisting of one or more days) that— The taxpayer is not resident in the UK for the next tax year because the taxpayer meets the third automatic overseas test for that year (see paragraph 14). A period “satisfies the overseas work criteria” if— A day falls within this sub-paragraph if— To work out whether the taxpayer works “sufficient hours overseas” as assessed over a given period, apply paragraph 14(3) but with the following modifications— The permitted limit is— The appropriate number is the result of— where— “A” is— 30, for sub-paragraphs (5)(c) and (7)(d), or 90, for sub-paragraph (5)(d), and “B” is the number of whole months in the part of the relevant year before the day mentioned in sub-paragraph (3)(a).
The circumstances of a case fall within Case 4 if they are as described in sub-paragraphs (2) to (4). The taxpayer was not resident in the UK for the previous tax year. At the start of the relevant year, the taxpayer did not meet the only home test, but there comes a day in the relevant year when that ceases to be the case and the taxpayer then continues to meet the only home test for the rest of that year. For the part of the relevant year before that day, the taxpayer does not have sufficient UK ties. The “only home test” is met if— Paragraphs 17 to 20 (and Part 2 of this Schedule so far as it relates to those paragraphs) apply for the purposes of sub-paragraph (4) with the following adjustments— The appropriate number is found by multiplying the number of days, in each case, by— where “A” is the number of whole months in the part of the relevant year beginning with the day mentioned in sub-paragraph (3). Sub-paragraph (6)(a) does not apply to the references to year X in paragraphs 32(1)(b) and 33 of this Schedule (which relate to the residence status of family members) so those references must continue to be read as references to year X.
The circumstances of a case fall within Case 7 if they are as described in sub-paragraphs (2) to (6). The taxpayer was not resident in the UK for the previous tax year. The taxpayer has a partner whose circumstances fall within Case 6 for— On a day in the relevant year, the taxpayer moves to the UK so the taxpayer and the partner can continue to live together on the partner’s return or relocation to the UK. In the part of the relevant year before the deemed arrival day— The taxpayer is resident in the UK for the next tax year (whether or not it is a split year). If sub-paragraph (3)(a) applies, the “deemed arrival day” is the later of— If sub-paragraph (3)(b) applies, the “deemed arrival day” is the day mentioned in sub-paragraph (4). The permitted limit is the number found by reducing 90 by the appropriate number. The appropriate number is the result of— where— “A” is 90, and “B” is the number of whole months in the part of the relevant year beginning with the deemed arrival day.
“The overseas part” of a split year is the part of that year defined below— For Case 1, the overseas part is— For Case 2, the overseas part is the part beginning with the deemed departure day as defined in paragraph 45(7) and (8). For Case 3, the overseas part is the part beginning with the day mentioned in paragraph 46(3)(a). For Case 4, the overseas part is the part before the day mentioned in paragraph 47(3). For Case 5, the overseas part is— For Case 6, the overseas part is— For Case 7, the overseas part is the part before the deemed arrival day as defined in paragraph 50(7) and (8). For Case 8, the overseas part is the part before the day mentioned in paragraph 51(3)(a).
for the Case in question, or
if the taxpayer’s circumstances fall within more than one Case, for the Case which has priority (see paragraphs 54 and 55).
“The UK part” of a split year is the part of that year that is not the overseas part.
Section 690 of ITEPA 2003 (employee non-residents etc) is amended as follows. In subsection (1), omit “only”. After that subsection insert—
Part 4 of ITTOIA 2005 (savings and investment income) is amended as follows.
In TCGA 1992, for section 10A substitute—
The amendments made by this Schedule are treated as having come into force on 1 January 2013.
In section 61 (tenants occupying land for purposes of trade treated as incurring expenses) after subsection (5) insert—
The Table in paragraph 1 of that Schedule is amended as follows. 10A Annual tax on enveloped dwellings Amount payable under section 163(1) or (2) of FA 2013 (except an amount falling within item 23). The date falling 30 days after the date specified in section 163(1) or (2) of FA 2013 as the date by which the amount must be paid 15A Annual tax on enveloped dwellings Amount shown in determination under paragraph 18 of Schedule 33 to FA 2013 The date falling 30 days after the filing date for the return in question In item 17, in the second column, for “or 10” substitute “, 10 or 10A” and in the third column for “15” substitute “15A”.
After section 81 insert—
In section 368 (territorial scope of charges in respect of savings and investment income), after subsection (2) insert—
For section 86A of TCGA 1992 substitute—
Section 371CE of TIOPA 2010 (as amended by paragraph 17 above) applies for accounting periods of CFCs beginning before 20 March 2013 with the modifications set out in this paragraph. References below to subsections are to subsections of section 371CE.
In section 292 (tenants under taxed leases treated as incurring expenses) after subsection (4) insert—
Until paragraphs 2(13)(a) and 2(14)(a) of Schedule 11 to F(No. 3)A 2010 (which amend items 23 and 24) come into force, paragraph 1 of Schedule 56 to FA 2009 has effect as if— With effect from the coming into force of paragraphs 2(13)(a) and 2(14)(a) of Schedule 11 to F(No. 3)A 2010, paragraph 1 of Schedule 56 to FA 2009 is amended as follows—
In section 85 (liability for tax), after subsection (2) insert—
In section 465 (person liable for tax on gains from life insurance etc: individuals), after subsection (1) insert—
In section 96 (payment by and to companies), in subsection (9A), for the words from “which in his case” to the end substitute for which he or she was not so resident if—
The amendments made by paragraphs 2 and 3 above have effect in relation to leases granted on or after 6 April 2013.
Until paragraph 3 of Schedule 11 to F(No. 3)A 2010 comes into force, paragraph 2(c) has effect as if the reference in that paragraph to items 1 to 10 were to items 1 to 10A.
In section 86 (payment of tax), after subsection (2) insert—
In section 467 (person liable: UK resident trustees), in subsection (4), after paragraph (a) insert—.
Section 279B (deferred unascertainable consideration: supplementary provisions) is amended as follows. In subsection (7), for “year of return” substitute “period of return”. In subsection (8)(a) and (b), for “year” substitute “period”.
Schedule 56 to FA 2009, as amended by paragraph 9, is taken to have come into force for the purposes of annual tax on enveloped dwellings on the date on which this Act is passed.
In the table in section 122 (index of defined expressions), in second column of the entry for “settlement”, after “paragraph 1(1)” insert “(except as otherwise expressly provided)”.
Section 528 (reduction in amount charged under Chapter 9 of Part 4: non-UK resident policy holders) is amended as follows. The amendments made by sub-paragraphs (3) to (6) apply to section 528 as substituted by paragraph 3 of Schedule 8 to this Act, and have effect in relation to policies and contracts in relation to which that section as so substituted has effect. In subsection (1)(b), for the words from “on which” to the end substitute “that are foreign days”. After subsection (1) insert— In subsection (3), in the definition of “A”, for “days falling within subsection (1)(b)” substitute “foreign days”. In subsection (8), for “subsection (1)(b)” substitute “subsection (1A)(a) and (b)”. The amendments made by sub-paragraphs (8) to (10) apply to section 528 as in force immediately before the substitution mentioned in sub-paragraph (2) so far as that section as so in force continues to have effect after the substitution. In subsection (1), for the words from “the policy holder” to the end substitute “there are one or more days in the policy period that are foreign days.” After that subsection insert— In subsection (3), in the definition of “A”, for the words from “on which” to the end substitute “in the policy period that are foreign days, and”.
Schedule 4C (transfers of value: attribution of gains to beneficiaries) is amended as follows. In paragraph 6(1)(b), for “year of return” substitute “period of return”. In paragraph 12(1)— In paragraph 12(2), for “year of return” substitute “period of return”. In paragraph 12A(1)—
Section 528A (reduction in amount charged on basis of non-UK residence of deceased person), as inserted by paragraph 3 of Schedule 8 to this Act, is amended as follows. In subsection (1)(b), for the words from “on which” to the end substitute “that were foreign days”. In subsection (2)— After that subsection insert— In subsection (4), in the definition of “A”, for the words from “are days falling” to the end substitute “were foreign days, and”. In subsection (8), for “subsection (1)(b) or (2)(b)” substitute “subsection (2A)(a) and (b)”.
Section 536 (top slicing relieved liability: one chargeable event) is amended as follows. The amendment made by sub-paragraph (3) applies to section 536 as amended by paragraph 5 of Schedule 8 to this Act, and has effect in accordance with paragraph 7 of that Schedule. For subsection (7) substitute— The amendment made by sub-paragraph (5) applies to section 536 as in force immediately before it is amended by paragraph 5 of Schedule 8 to this Act, so far as that section as so in force continues to have effect after it is so amended. For subsection (7) substitute—
If no representations are made in accordance with paragraph 4, a designated HMRC officer must refer the matter to the GAAR Advisory Panel.
A designated HMRC officer may give a notice, or do anything else, under this Schedule where the officer considers that a tax advantage might have arisen to the taxpayer. Accordingly, any notice given by a designated HMRC officer under this Schedule may be expressed to be given on the assumption that the tax advantage does arise (without agreeing that it does).
Part 9A of TIOPA 2010 (controlled foreign companies) is amended as follows.
If representations are made in accordance with paragraph 4, a designated HMRC officer must consider them. If, after considering them, the designated HMRC officer considers that the tax advantage ought to be counteracted under section 209, the officer must refer the matter to the GAAR Advisory Panel.
Chapter 5 (the CFC charge gateway: non-trading finance profits) is amended as follows.
If the matter is referred to the GAAR Advisory Panel, the designated HMRC officer must at the same time provide it with—
a copy of the notice given to the taxpayer under paragraph 3,
a copy of any representations made in accordance with paragraph 4 and any comments that the officer has on those representations, and
a copy of the notice given to the taxpayer under paragraph 8.
In section 371ED (arrangements in lieu of dividends) in subsection (1) omit “(other than a relevant finance lease)”.
If the matter is referred to the GAAR Advisory Panel, the designated HMRC officer must at the same time give the taxpayer a notice which—
specifies that the matter is being referred,
is accompanied by a copy of any comments provided to the GAAR Advisory Panel under paragraph 7(b), and
informs the taxpayer of the period under paragraph 9 for making representations, and of the requirement under that paragraph to send any representations to the officer.
Section 371EE (leases to UK resident companies etc) is amended as follows. In subsection (2)(b)(i) for “which is the subject of the lease” substitute “(“the relevant asset”) which is the subject of the lease or making (directly or indirectly) an arrangement which would fall within subsection (3)”. After subsection (2) insert—
The taxpayer has 21 days beginning with the day on which a notice is given under paragraph 8 to send the GAAR Advisory Panel written representations about— The GAAR Advisory Panel may, on a written request made by the taxpayer, extend the period during which representations may be made. The taxpayer must send a copy of any representations to the designated HMRC officer at the same time as the representations are sent to the GAAR Advisory Panel. If no representations were made in accordance with paragraph 4, the designated HMRC officer—
Chapter 22 (supplementary provision) is amended as follows.
In section 371VA (definitions) for the definition of “relevant finance lease” substitute—.
Section 371VG (finance profits) is amended as follows. In subsection (1) for paragraph (b) substitute— In subsection (4)(b) omit “an arrangement which would be”.
Section 371VH (interests in companies) is amended as follows. In subsection (9) omit the second sentence. After subsection (10) insert—
After section 371VI insert—
Subsections (8) to (9) of section 30 of the Petroleum Act 1998 (which specifies when one body corporate is associated with another) apply for the purposes of this section as they apply for the purposes of that section.
In section 80 “decommissioning expenditure” means expenditure incurred in connection with—
demolishing any plant or machinery,
preserving any plant or machinery pending its reuse or demolition,
preparing any plant or machinery for reuse,
arranging for the reuse of any plant or machinery, or
the restoration of any land.
It is immaterial for the purposes of subsection (1)(b) whether the plant or machinery is reused, is demolished or is partly reused and partly demolished.
It is immaterial for the purposes of subsection (1)(c) and (d) whether the plant or machinery is in fact reused.
In subsection (1)(e) “restoration” includes landscaping.
The Treasury may by order amend this section.
An order under subsection (5) may include transitional provision and savings.
The power to make an order under subsection (5) is exercisable by statutory instrument.
A statutory instrument containing an order under subsection (5) is subject to annulment in pursuance of a resolution of the House of Commons.
For each financial year the Treasury must prepare a report containing the information in subsection (2).
The information is—
the number of decommissioning relief agreements entered into in that year,
the total number of decommissioning relief agreements in force at the end of that year,
the number of payments made under any decommissioning relief agreements during that year, and the amount of each payment,
the total number of payments that have been made under any decommissioning relief agreements as at the end of that year, and the total amount of those payments, and
an estimate of the maximum amount liable to be paid under any decommissioning relief agreements.
The report for a financial year must be laid before the House of Commons as soon as is reasonably practicable after the end of that year.
In this section “decommissioning relief agreement” has the same meaning as in section 80.
This section has effect in relation to financial years ending on or after 31 March 2014.
This section applies where a sum is payable to a company (“the claimant”) under a decommissioning relief agreement.
Subsection (3) applies where the reference amount is calculated by reference to what the claimant's assessable profit in any chargeable period would be if any expenditure incurred by it were used to reduce its profit in a particular way (rather than in any way that it has in fact been used).
For the purposes of petroleum revenue tax—
the expenditure is treated as having been used to reduce the claimant's profit in that way (rather than in any way that it has in fact been used), and
the claimant is treated as if it had received the tax relief it would receive if its profit were reduced in that way (so no repayment of tax is to be made by virtue of this subsection).
Subsection (5) applies where the reference amount is calculated by reference to what any other company's assessable profit in any chargeable period would be if any expenditure incurred by the claimant—
had been incurred by the other company, and
were used to reduce the other company's profit in a particular way.
For the purposes of petroleum revenue tax—
the expenditure is treated as incurred by the other company (and not the claimant),
the expenditure is treated as having been used by the other company to reduce its profit in that way, and
the other company is treated as if it had received the tax relief it would receive if its profit were reduced in that way (so no repayment of tax is to be made by virtue of this subsection).
In this section—
“company” has the meaning given by section 1121 of CTA 2010,
This section applies where—
a company defaults on a liability under— to make a payment towards decommissioning expenditure in respect of an oil field,
a relevant agreement, or
an abandonment programme,
in consequence of the default, another company (“the other company”) that has rights under a decommissioning relief agreement at the time of the default incurs decommissioning expenditure in respect of that oil field, and
but for paragraph 15 of Schedule 17 to FA 1980 (terminal losses), a sum (or a sum of a greater amount) would be payable to the other company under the decommissioning relief agreement.
Paragraph 15 of Schedule 17 to FA 1980 does not apply in relation to any allowable loss accruing to the other company from that oil field.
Any allowable unrelievable field loss (within the meaning of section 6 of OTA 1975) that— is not to be regarded as arising.
consists of the unrelieved portion of an allowable loss within subsection (2), and
would (in the absence of this subsection) arise as a result of subsection (2),
Nothing in this section affects the operation of section 83(3) or (5).
In this section—
“oil field” has the same meaning as in OTA 1975,
Section 104 of FA 1991 is amended as follows. In subsection (1), omit “and sections 105 and 106 below”. In subsection (2), omit “and section 106 (but not section 105) below”.
ITEPA 2003 is amended as follows.
This paragraph applies to an individual who— Enactments relating to income tax or capital gains tax have effect, in relation to any eligible foreign income and gains of the individual, as if the amendments made by this Part of this Schedule had not been made. “Eligible foreign income and gains” means— Where, by virtue of this paragraph, it is necessary to determine whether an individual is (or is not) ordinarily resident in the United Kingdom at a time on or after 6 April 2013, the question is to be determined as it would have been in the absence of this Schedule.
ITEPA 2003 is amended as follows.
The amendments made by this Part of this Schedule have effect for the purposes of a person’s liability to income tax for the tax year 2013-14 or any subsequent tax year. Sub-paragraph (1) is without prejudice to any provision in this Part of the Schedule about the application of a particular amendment.
The amendments made by this Part of this Schedule have effect in relation to a person’s liability to capital gains tax for the tax year 2013-14 or any subsequent tax year. Sub-paragraph (1) is without prejudice to any provision in this Part of this Schedule about the application of a particular amendment.
The Proceeds of Crime Act 2002 is amended in accordance with paragraphs 2 to 20.
In section 80(1) and (3) of the Serious Crime Act 2007 (amendment of sections 352(5) and 353(10) of the Proceeds of Crime Act 2002), omit paragraph (a) and the word “and” at the end of that paragraph.
In Schedule 7 to the Policing and Crime Act 2009 (minor and consequential amendments), omit paragraph 116.
In FA 2008, omit section 105.
In section 22 (chargeable overseas earnings for year when remittance basis applies and employee ordinarily UK resident), in subsection (1), for paragraph (b) substitute— Accordingly—
In section 56 (application of Income Tax Acts in relation to deemed employment), in subsection (5)—
for paragraph (a) substitute—, and
in paragraph (b), omit “or ordinarily resident”.
Section 289 (searches) is amended as follows. In subsections (1), (1A)(a) and (2), for “a customs officer” substitute “an officer of Revenue and Customs”. In subsections (1C) and (1D), for “customs officer” substitute “officer of Revenue and Customs”. After subsection (5)(b) insert—. After subsection (5) insert—
In Part 2 of ITTOIA 2005, Chapter 16A is amended as follows.
In section 23 (calculation of “chargeable overseas earnings”), in subsection (2), for paragraph (aa) substitute—.
In section 61G (application of Income Tax Acts in relation to deemed employment), in subsection (5)—
for paragraph (a) substitute—, and
in paragraph (b), omit “or ordinarily resident”.
In section 290 (prior approval for search)—
in subsection (4)(a), for “a customs officer, a customs officer” substitute “an officer of Revenue and Customs, such an officer”, and
in subsection (6), for “customs officer” substitute “officer of Revenue and Customs”.
Section 225N is amended as follows. Omit subsection (5). In subsection (6), in the definition of “abandonment guarantee”— The heading of that section becomes “ Expenditure on abandonment guarantees ”.
In section 26 (foreign earnings for year when remittance basis applies and employee not ordinarily UK resident), in subsection (1), for “is not ordinarily UK resident in” substitute “meets the requirement of section 26A for”. Accordingly—
In section 328 (the income from which deductions may be made), in subsection (5), omit the entry for Chapter 6 of Part 5 and the word “and” immediately preceding it.
In section 291(2) (report on exercise of powers), for “customs officer” substitute “officer of Revenue and Customs”.
Omit sections 225P and 225Q.
After that section insert—
In section 341 (travel at start or finish of overseas employment), in subsection (3), for “resident and ordinarily resident in the United Kingdom” substitute “UK resident”.
In section 292 (code of practice)—
in subsection (1), for “customs officers” substitute “officers of Revenue and Customs”, and
in subsection (6), for “a customs officer” substitute “an officer of Revenue and Customs”.
In section 225R (introduction to sections 225S and 225T)—
in subsection (1), for “Sections 225S and 225T apply” substitute “ Section 225S applies ”;
the heading of section 225R becomes “ Introduction to section 225S ”.
Section 41C (foreign securities income) is amended as follows. In subsection (4), for paragraph (b) substitute—. In subsection (6), for paragraph (b) substitute—.
In section 342 (travel between employments where duties performed abroad), in subsection (6), for “resident and ordinarily resident in the United Kingdom” substitute “UK resident”.
Section 294 (seizure of cash) is amended as follows. In subsections (1) and (2), for “A customs officer” substitute “An officer of Revenue and Customs”. After subsection (2) insert—
In section 295(1) (detention of seized cash), for “customs officer” substitute “officer of Revenue and Customs”.
In Part 8 of CTA 2010, Chapter 4 is amended as follows.
In section 271 (limited exemption of removal benefits and expenses: general), in subsection (2)—
in paragraph (a), for “ordinarily UK resident” substitute “outside section 26”, and
in paragraph (b), for “not ordinarily UK resident” substitute “meets section 26A requirement”.
In section 370 (travel costs where duties performed abroad: employee’s travel), in subsection (6), omit “in which the employee is ordinarily UK resident”.
Section 292 is amended as follows. Omit subsection (5). In subsection (6), in the definition of “abandonment guarantee”— The heading of that section becomes “ Expenditure on abandonment guarantees ”.
In section 554Z9 (remittance basis: A is ordinarily UK resident), in subsection (1), for paragraph (c) substitute—. Accordingly, in the heading of that section, for “A is ordinarily UK resident” substitute “A does not meet section 26A requirement”.
In section 376 (foreign accommodation and subsistence costs and expenses (overseas employments)), in subsection (1)(b), for “resident and ordinarily resident in the United Kingdom” substitute “UK resident”.
In section 296(2) (interest on cash), for “customs officer” substitute “officer of Revenue and Customs”.
In section 297(4) (release of detained cash), for “A customs officer” substitute “An officer of Revenue and Customs”.
Omit sections 294 and 295.
In section 554Z10 (remittance basis: A is not ordinarily resident), in subsection (1), for paragraph (c) substitute— Accordingly, in the heading of that section, for “A is not ordinarily resident” substitute “A meets section 26A requirement”.
Section 378 (deductions from seafarers’ earnings: eligibility) is amended as follows. In subsection (1), for “relevant taxable earnings or EEA-resident earnings” substitute “relevant general earnings”. For subsection (5) substitute— Omit subsection (6).
In section 296 (introduction to sections 297 and 298)—
in subsection (1), for “Sections 297 and 298 apply” substitute “ Section 297 applies ”;
the heading of section 296 becomes “ Introduction to section 297 ”.
Section 690 (employee non-resident etc) is amended as follows. In subsection (1), for paragraph (a) substitute—. In subsection (2A), for “but not ordinarily resident in a tax year” substitute “for a tax year but not domiciled in the United Kingdom in that tax year”.
Section 413 (exception in certain cases of foreign service) is amended as follows. In subsection (2), after “subsection” (in the second place it occurs) insert “(2A),”. After that subsection insert— In subsection (3), after “2003-04” insert “but before the tax year 2013-14”. After that subsection insert—
In section 302(6) (compensation), for “a customs officer” substitute “an officer of Revenue and Customs”.
In section 351(5) (person making application to vary or discharge order)—
for “a customs officer” substitute “an officer of Revenue and Customs”, and
for “customs officer” substitute “officer of Revenue and Customs”.
In section 681A (foreign benefits of consular employees), for subsection (4) substitute— The amendment made by this paragraph does not apply to a person who became a consular officer or employee in the United Kingdom before 6 April 2013.
In Schedule 2 (approved share incentive plans), in paragraph 8(2), omit paragraph (b) and the “and” immediately before it. The amendments made by this paragraph do not apply to plans that have been approved before the day on which this Act is passed.
Section 352 (search and seizure warrants) is amended as follows. In subsection (5)— In subsection (7), omit “(a) or”.
Section 353 (requirements where production order not available) is amended as follows. In subsection (10)— In subsection (11), omit “(a) or”.
In Schedule 3 (approved SAYE option schemes), in paragraph 6(2)— The amendments made by this paragraph do not apply to schemes that have been approved before the day on which this Act is passed.
In Schedule 5 (enterprise management incentives), in paragraph 27(3)(b), omit “and ordinarily resident”.
Section 369 (customer information orders: supplementary provisions) is amended as follows. In subsection (5)— In subsection (7), for “a customs officer” substitute “an officer of Revenue and Customs”.
for “a customs officer” substitute “an officer of Revenue and Customs”, and
for “customs officer” substitute “officer of Revenue and Customs”.
In section 375(4) (account monitoring orders: supplementary provisions)—
for “a customs officer” substitute “an officer of Revenue and Customs”, and
for “customs officer” substitute “officer of Revenue and Customs”.
After section 375B insert—
In section 377(1) (persons subject to code of practice), for paragraph (e) substitute—
In section 378 (officers)—
in subsection (1), for paragraph (d) substitute—,
in subsections (2)(c) and (6)(b), for “a customs officer” substitute “an officer of Revenue and Customs”, and
in subsection (4), for paragraph (c) substitute—
After section 408B insert—
In section 412 (interpretation), in the entry relating to the meaning of references to a “constable”, for “a customs and excise officer” substitute “an officer of Revenue and Customs”.
This section applies where—
a company defaults on a liability under— to make a payment towards decommissioning expenditure in respect of an oil field,
a relevant agreement, or
an abandonment programme,
in consequence of the default, another company that has rights under a decommissioning relief agreement at the time of the default incurs decommissioning expenditure in respect of that oil field, and
by virtue of section 83, any expenditure incurred by that company (whether or not that decommissioning expenditure) is treated as having been used by that company or any other company (“the affected company”) to reduce its assessable profit in a chargeable period in a particular way.
If, in the absence of section 83, the assessable profit accruing to the affected company from an oil field in that chargeable period would be reduced under section 8(1) of OTA 1975, the amount of the oil allowance for the oil field utilised by the affected company in that chargeable period for the purposes of section 8 of that Act is to be determined as if section 83 did not apply.
In this section—
In Chapter 3 of Part 3 of IHTA 1984 (settled property: settlements without interests in possession etc), section 58 (relevant property) is amended as follows.
In subsection (1), omit the “and” at the end of paragraph (ea) and before paragraph (f) insert—.
At the end insert—
This section is treated as having come into force on 20 March 1993.
For the purposes of section 58 of IHTA 1984—
any reference in that section to Part 4 of the Petroleum Act 1998 has effect, in relation to any period before the coming into force of that Part, as a reference to Part 1 of the Petroleum Act 1987, and
section 38A of the Petroleum Act 1998 is to be treated as having come into force at the same time as this section.
There is to be no charge to tax under section 65 of IHTA 1984 if the only reason for such a charge would be that property ceases to be relevant property by virtue of the coming into force of this section.
In Part 8 of CTA 2010 (oil activities), after section 287 insert—
In section 464 of CTA 2009 (priority of Part 5 for corporation tax purposes), in subsection (3)(e), for “and 287” substitute “ to 287A ”.
The amendments made by this section have effect in relation to accounting periods beginning on or after the day on which this Act is passed.
Section 330B of CTA 2010 (decommissioning expenditure taken into account for PRT purposes) is amended as follows.
In subsection (1), omit the “and” at the end of paragraph (a) and after paragraph (b) insert, and
For subsection (2) substitute—
In subsection (3)—
“the relevant percentage of the decommissioning expenditure” is the percentage of that expenditure that is the used-up amount referred to in subsection (1)(c),
in the definition of “the appropriate fraction”, omit “relevant”;
in the definition of “the PRT difference”, for “subsection (1)” substitute “ subsection (1)(a) ”.
In subsection (4), for “subsection (1)” substitute “ subsection (1)(a) ”.
In subsection (7)—
omit the definition of “the relevant accounting period”, and
“the used-up amount”, in relation to any expenditure, has the same meaning as in section 330A (see subsection (3) of that section).
The amendments made by this section have effect in relation to expenditure incurred in connection with decommissioning carried out on or after the day on which this Act is passed.
Part 1 of Schedule 31 contains provision about expenditure on and under abandonment guarantees and abandonment expenditure.
Part 2 of Schedule 31 contains provision about calculating the profits of a ring fence trade carried on by a person who incurs expenditure on meeting another person's decommissioning liabilities.
Section 163 of CAA 2001 (meaning of “general decommissioning expenditure”) is amended as follows.
In subsection (1)—
the words after “if” become paragraph (a) of that subsection,
in that paragraph, for “subsections (3) to (4)” substitute “ subsections (3), (3A) and (4) ”, and
at the end of that paragraph insert, or
After subsection (3A) insert—
In subsection (5)(a), for “ “oil field” has” substitute “ “oil” and “oil field” have”.
The amendments made by this section have effect in relation to expenditure incurred on decommissioning carried out on or after the day on which this Act is passed.
In section 164 of CAA 2001 (general decommissioning expenditure incurred before cessation of ring fence trade), after subsection (1B) insert—
The amendment made by this section has effect in relation to expenditure incurred on decommissioning carried out on or after the day on which this Act is passed.
Part 5 of CAA 2001 (mineral extraction allowances) is amended as follows.
In section 395 (qualifying expenditure), in subsection (1)(d), omit “post-trading”.
In section 403 (qualifying expenditure on acquiring a mineral asset), after subsection (2) insert—
In section 416 (expenditure on restoration within 3 years of ceasing to trade)—
in subsections (1)(a) and (6)(a), before “mineral extraction trade” insert “ relevant ”;
But it does not include decommissioning any plant or machinery (within the meaning of section 163).
after subsection (7) insert—;
the heading of section 416 becomes “ Non-ring fence trades: expenditure on restoration within 3 years of ceasing to trade ”.
In Chapter 5, after section 416 insert—
In section 416B (first-year qualifying expenditure), in subsection (2), at the end insert “ (within the meaning of section 403) ”.
Part 4 of CTA 2010 (loss relief) is amended as follows.
In section 40 (ring fence trades: extension of periods for which relief may be given), in subsection (1)(b), for “403” substitute “ by virtue of section 416ZA ”.
In section 43 (claim period in case of ring fence or mineral extraction trades), in subsection (1)(b)—
after “416” insert “ or 416ZA ”, and
for the words from “restoration” to “trade” substitute “ site restoration ”.
The amendments made by this section have effect in relation to expenditure incurred on restoration carried out on or after the day on which this Act is passed.
Schedule 32 contains provision in connection with restrictions on allowances for certain oil-related expenditure.
A tax (called “annual tax on enveloped dwellings”) is to be charged in accordance with this Part.
Tax is charged in respect of a chargeable interest if on one or more days in a chargeable period—
the interest is a single-dwelling interest and has a taxable value of more than £500,000, and
a company, partnership or collective investment scheme meets the ownership condition with respect to the interest.
The tax is charged for the chargeable period concerned.
A company meets the ownership condition with respect to a single-dwelling interest on any day on which the company is entitled to the interest (otherwise than as a member of a partnership or for the purposes of a collective investment scheme).
A partnership meets the ownership condition with respect to a single-dwelling interest on any day on which a member of the partnership that is a company is entitled to the interest (as a member of the partnership).
A collective investment scheme meets the ownership condition with respect to a single-dwelling interest on any day on which the interest is held for the purposes of the scheme.
If a company is jointly entitled to a chargeable interest (as a member of a partnership or otherwise), then regardless of whether the company is entitled as a joint tenant or tenant in common (or, in Scotland, as a joint owner or owner in common) the ownership condition is regarded as met in relation to the whole chargeable interest.
The chargeable periods are—
the period beginning with 1 April 2013 and ending with 31 March 2014, and
each subsequent period of 12 months beginning with 1 April.
See also section 95.
In this Part “entitled” means beneficially entitled— This is subject to subsection (2).
whether solely or jointly with another person, and
whether as a member of a partnership or otherwise.
References in this Part to entitlement to a single-dwelling interest (or any other chargeable interest) do not include—
entitlement in the capacity of a trustee or personal representative, or
entitlement as a beneficiary under a settlement.
Subsection (1)(b) does not apply where the contrary is specified.
In this section “settlement” has the same meaning as in Part 4 of FA 2003 (see paragraph 1 of Schedule 16 to that Act).
The chargeable person is liable to pay tax charged under this Part.
“The chargeable person” means—
in relation to tax charged by virtue of section 94(4), the company;
in relation to tax charged by virtue of section 94(5), the responsible partners.
In relation to tax charged by virtue of section 94(6) “the chargeable person” means—
if the collective investment scheme is a unit trust scheme, the trustee of the scheme;
if the collective investment scheme is an open-ended investment company, the body corporate referred to in section 236(2) of the Financial Services and Markets Act 2000;
in relation to an EEA UCITS which is not an open-ended investment company or unit trust scheme, the management company for that UCITS;
in any other case, the person who has day-to-day control over the management of the property subject to the scheme.
The liability of the responsible partners to pay tax charged on them under this Part is joint and several.
References in this section to “the responsible partners” are to all the persons who are members of the partnership concerned on the first day in the chargeable period on which the partnership meets the ownership condition with respect to the single-dwelling interest.
Tax charged under this Part is said to be “charged on” the chargeable person (and that person is said to be “chargeable to” the tax).
Subsection (2) applies if—
a company is within the charge for a chargeable period with respect to a single-dwelling interest by virtue of section 96(2)(a), and
one or more other persons are jointly entitled to the interest on the first day in that period on which the company is within the charge with respect to it.
The company and the other person or persons are jointly and severally liable for the tax charged for that period with respect to the interest (whether or not those other persons are also within the charge with respect to the interest on the day in question).
Subsection (4) applies if—
a company that is a member of a partnership is entitled (as a member of the partnership) to a single-dwelling interest on a day in a chargeable period, and
as a result, the responsible partners are within the charge with respect to the interest for the period.
If, on the first day in the chargeable period on which the responsible partners are within the charge a person (“P”) who is not one of the responsible partners is jointly entitled to the chargeable interest, P and the responsible partners are jointly and severally liable for the tax charged for the period with respect to the interest (whether or not P is also within the charge with respect to the interest on the day in question).
Subsection (2) applies where tax is charged for a chargeable period with respect to a single-dwelling interest by virtue of section 94(6).
The persons who are major participants in the scheme on the first day of the chargeable period on which the chargeable person is within the charge with respect to the interest are jointly and severally liable with the chargeable person for the tax charged.
Subsection (2) does not permit the recovery from a major participant of an amount exceeding the market value of the participant's holding in the scheme.
The reference in subsection (3) to a participant's holding in a collective investment scheme is to the interests or rights by virtue of which the participant takes part in the scheme.
Tax chargeable by virtue of section 94(6) may be recovered from the depositary (if any) of a collective investment scheme, but only up to the amount or value of any money or other property subject to the scheme that has been entrusted to the depositary for safekeeping.
The depositary—
may retain out of any money entrusted to it as mentioned in subsection (5) enough money to pay that tax, and
is entitled to be fully reimbursed by the participants in the scheme (by that method or another) for amounts recovered under subsection (5).
In this section—
“depositary”, in relation to a collective investment scheme (other than a unit trust scheme), has the meaning given by section 237(2) of the Financial Services and Markets Act 2000;
“major participant”, in relation to a collective investment scheme, is to be read in accordance with section 136(4);
“participant”, in relation to a collective investment scheme, is to be read in accordance with section 235 of the Financial Services and Markets Act 2000.
For the purposes of this Part “market value” is to be determined as for the purposes of TCGA 1992 (see, particularly, section 272 of that Act).
The amount of tax charged for a chargeable period with respect to a single-dwelling interest is stated in subsection (2) or (3).
If the chargeable person is within the charge with respect to the single-dwelling interest on the first day of the chargeable period, the amount of tax charged is equal to the annual chargeable amount.
Otherwise, the amount of tax charged is equal to the relevant fraction of the annual chargeable amount.
The annual chargeable amount for a single-dwelling interest and a chargeable period is determined in accordance with the following table, by reference to the taxable value of the interest on the relevant day. Annual chargeable amount Taxable value of the interest on the relevant day £3,500 More than £500,000 but not more than £1 million. £7,000 More than £1 million but not more than £2 million. £23,350 More than £2 million but not more than £5 million. £54,450 More than £5 million but not more than £10 million. £109,050 More than £10 million but not more than £20 million. £218,200 More than £20 million.
The “relevant day” is—
for the purposes of subsection (2), the first day of the chargeable period;
for the purposes of subsection (3), the first day in the chargeable period on which the chargeable person is within the charge with respect to the interest.
The relevant fraction is— where— “N” is the number of days from (and including) the relevant day to the end of the chargeable period; “Y” is the number of days in the chargeable period.
See also—
section 100 (interim relief), and
section 106 (adjustment of amount chargeable).
Where tax is charged for a chargeable period with respect to a single-dwelling interest, the chargeable person may claim relief before the end of the chargeable period if—
one or more days in the period is relievable with respect to the interest (by virtue of any of sections 133 to 150),
one or more days in the chargeable period (after the first day in the period on which the chargeable person is within the charge with respect to the interest) are days on which the chargeable person is not within the charge with respect to the interest, or
the taxable value of the single-dwelling interest on the first day in the chargeable period on which the chargeable person is within the charge with respect to the interest is higher than its taxable value on a later day in the chargeable period on which the chargeable person remains within the charge with respect to the interest.
Relief under this section is called “interim relief”, and must be claimed—
in an annual tax on enveloped dwellings return, or
by amending such a return.
Where interim relief is claimed under this section, section 163(1) (payment of tax by filing date for annual tax on enveloped dwellings return) has effect as if the amount of tax charged with respect to the single-dwelling interest were the sum of amounts A and B.
Amount A is the total of all the daily amounts for days in the pre-claim period on which the chargeable person is within the charge with respect to the single-dwelling interest, other than days that are relievable with respect to the single-dwelling interest.
Amount B is zero if—
the day of the claim is relievable with respect to the single-dwelling interest by virtue of any of sections 133 to 150, or
the chargeable person is not within the charge with respect to the single-dwelling interest on the day of the claim.
Otherwise, amount B is the appropriate fraction of the annual chargeable amount for the single-dwelling interest. For this purpose the annual chargeable amount is determined (under section 99(4)) on the basis that the day of the claim is the relevant day.
In subsection (6) “appropriate fraction” means— where— “X” is the number of days in the period beginning with the day of the claim and ending at the end of the chargeable period, and “Y” is the number of days in the chargeable period.
In this section—
See sections 105 and 106 for provision about the adjustment of the amount of tax charged.
If the consumer prices index for September in 2013 or any later year (“the later year”) is higher than it was for the previous September, section 99(4) applies in relation to chargeable periods beginning on or after 1 April in the year after the later year with the following amendments.
For each of the annual chargeable amounts stated in the table in section 99(4) (as it applies in relation to chargeable periods beginning in the previous 12 months) there is substituted the indexed amount.
“The indexed amount” is found by—
increasing the previous amount by the same percentage increase as the percentage increase in the consumer prices index, and
rounding down the result to the nearest multiple of £50.
In this section “consumer prices index” means the all items consumer prices index published by the Statistics Board.
The Treasury must, before 1 April 2014 and before each subsequent 1 April, make an order stating the amounts that by virtue of this section are to be the annual chargeable amounts for chargeable periods beginning on or after that date.
The taxable value of a single-dwelling interest on any day (“the relevant day”) is equal to its market value at the end of the latest day that—
falls on or before that day, and
is a valuation date in the case of that interest.
Each of the following is a valuation date in the case of any single-dwelling interest—
1 April 2012;
each 1 April falling 5 years, or a multiple of 5 years, after 1 April 2012.
The following are also valuation dates in the case of any single-dwelling interest to which a company is entitled on the relevant day (otherwise than as a member of a partnership)—
the effective date of any substantial acquisition by the company of a chargeable interest in or over the dwelling concerned;
the effective date of any substantial disposal of part (but not the whole) of the single-dwelling interest.
But a day that is a valuation date only because of subsection (2)(b) (a “5-yearly valuation date”) is to be treated as if it were not a valuation date for the purpose of determining the taxable value of a single-dwelling interest on any day in the chargeable period beginning with that 5-yearly valuation date.
The following are also valuation dates in the case of any single-dwelling interest to which a company is entitled on the relevant day as a member of a partnership—
the effective date of any substantial acquisition as a result of which a chargeable interest in or over the dwelling concerned became an asset of the partnership,
the effective date of any substantial disposal of part (but not the whole) of the single-dwelling interest.
The following are also valuation dates in the case of any single-dwelling interest that is on the relevant day held for the purposes of a collective investment scheme—
the effective date of any substantial acquisition, made for the purposes of the scheme, of a chargeable interest in or over the dwelling concerned;
the effective date of any substantial disposal of part (but not the whole) of the single-dwelling interest.
In this section references to a disposal of part of a single-dwelling interest include the grant of a chargeable interest out of the single-dwelling interest.
The grant of an option does not count as the grant of a chargeable interest for the purposes of subsection (6).
For the purposes of section 102—
the acquisition of a chargeable interest in a dwelling is a “substantial acquisition” only if the chargeable consideration for the acquisition is £40,000 or more;
the disposal of part (but not the whole) of a single-dwelling interest is a “substantial disposal” only if the chargeable consideration for the acquisition of the chargeable interest by the person acquiring it is £40,000 or more.
If the acquisition mentioned in subsection (1)(a) is a transaction between persons who are connected with each other or not acting at arm's length, subsection (1)(a) applies as if the reference to the chargeable consideration for the acquisition were to the market value of the chargeable interest acquired.
If the disposal mentioned in subsection (1)(b) is a transaction between persons who are connected with each other or not acting at arm's length, subsection (1)(b) applies as if the reference to the chargeable consideration for the acquisition in question were to the market value of the part of the single-dwelling interest disposed of.
The chargeable consideration for the acquisition mentioned in subsection (1)(a) is taken to include the chargeable consideration for any linked acquisition of a chargeable interest in or over the same dwelling.
The chargeable consideration for the transaction mentioned in subsection (1)(b) is taken to include the chargeable consideration for any linked disposal of part (but not the whole) of the single-dwelling interest concerned.
For the purposes of subsection (2) the market value of the chargeable interest acquired is taken to be the sum of the market values of that chargeable interest and any chargeable interest in or over the same dwelling that is acquired in a linked transaction.
For the purposes of subsection (3) the market value of the part of the single-dwelling interest disposed of is taken to be the sum of the market values of that chargeable interest and any chargeable interest in or over the same dwelling that is disposed of in a linked transaction.
For the purposes of this section two or more transactions are “linked” if they form part of a single scheme, arrangement or series of transactions between the same vendor and purchaser or, in either case, persons connected with them.
In this section “chargeable consideration”, “purchaser” and “vendor” have the same meaning as in Part 4 of FA 2003.
In this section references to a disposal of part of a single-dwelling interest include the grant of a chargeable interest out of the single-dwelling interest.
Tax in respect of a given single-dwelling interest is charged only once for any chargeable day even if more than one person is “the chargeable person” with respect to the tax charged.
In relation to a person on whom tax is charged for a chargeable period with respect to a single-dwelling interest, the “adjusted chargeable amount” is the total of the daily amounts for all the days in the period on which the chargeable person is within the charge with respect to the interest.
The daily amount for any such day (“the actual day”) is— where— “Y” is the number of days in the chargeable period; “A” is the annual chargeable amount for the single-dwelling interest, determined (under section 99(4)) on the basis that the actual day is the relevant day.
Where tax is charged for a chargeable period with respect to a single-dwelling interest and the adjusted chargeable amount is greater than the initial charged amount, the amount of tax charged is taken to be increased to the adjusted chargeable amount.
In this section “the initial charged amount” means the amount of tax charged under section 99 for the period in respect of the interest.
Subsection (4) applies where—
tax is charged for a chargeable period with respect to a single-dwelling interest,
the adjusted chargeable amount is less than the initial charged amount, and
a claim for relief is made under this subsection.
The amount of tax charged for the period with respect to the interest is taken to be reduced (at the end of the chargeable period) to the adjusted chargeable amount.
Relief under subsection (3) must be claimed—
in an annual tax on enveloped dwellings return, or
by amending an annual tax on enveloped dwellings return.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Relief under subsection (3) may be given by repayment of tax or otherwise.
See also section 160 (return of adjusted amount chargeable); and see section 163(2) for provision about payment of additional tax by reference to the adjusted chargeable amount.
In this Part “chargeable interest” means—
an estate, interest, right or power in or over land in the United Kingdom, or
the benefit of an obligation, restriction or condition affecting the value of any such estate, interest, right or power.
Where two or more persons are jointly entitled to a chargeable interest the chargeable interest is not regarded, for the purposes of this Part, as consisting of separate interests corresponding to the shares (if any) that those persons have by virtue of their joint entitlement.
An exempt interest is not a chargeable interest for the purposes of this Part.
The following are exempt interests—
any security interest;
a licence to use or occupy land;
in England and Wales or Northern Ireland, a tenancy at will.
In subsection (4) “security interest” means an interest or right (other than a rentcharge) held for the purpose of securing the payment of money or the performance of any other obligation.
In the application of this Part in Scotland the reference in subsection (5) to a rentcharge is to be read as a reference to a feu duty or a payment mentioned in section 56(1) of the Abolition of Feudal Tenure etc (Scotland) Act 2000 (asp 5).
The Treasury may by regulations provide that any other description of interest or right in or over a dwelling is an exempt interest.
References in this Part to a “single-dwelling interest” are to be read in accordance with this section.
A chargeable interest that is exclusively in or over land consisting (on any day) of a single dwelling is a single-dwelling interest (on that day).
Where a person is entitled to a chargeable interest that is exclusively in or over land consisting (on any day) of two or more single dwellings—
provisions referring to a “single-dwelling interest” operate as if the person had (on that day) a separate chargeable interest in or over each dwelling, and
the chargeable interest in or over each dwelling is therefore a single-dwelling interest.
Where a person is entitled to a chargeable interest in or over land that on any day consists of one or more single dwellings and non-residential land—
provisions referring to a “single-dwelling interest” operate as if the person had (on that day) a separate chargeable interest in or over each dwelling and a further separate chargeable interest in or over the non-residential land, and
the chargeable interest in or over each dwelling is therefore a single-dwelling interest.
A single-dwelling interest is referred to as a single-dwelling interest “in” the dwelling concerned.
A single-dwelling interest in one dwelling is distinct from any single-dwelling interest in another dwelling, even if the dwellings stand successively on the same land.
In this section—
“non-residential land” means land that is not a dwelling or part of a dwelling;
references to a dwelling include a part of a dwelling.
Subsection (2) applies if on one or more days in a chargeable period—
a company is entitled to two or more single-dwelling interests in the same dwelling, or
two or more single-dwelling interests in the same dwelling are held for the purposes of the same collective investment scheme.
This Part has effect with respect to that chargeable period as if those separate interests constituted just one single-dwelling interest, the taxable value of which on any day is the sum of the taxable values of the separate interests.
In calculating the taxable values of the separate interests for the purposes of subsection (2), the market value of each interest is determined, under the provisions of TCGA 1992 applied by section 98(8), on the assumption that the other interest or interests are placed on the open market with that interest (on the valuation date appropriate to that interest).
If on any day (“the relevant day”) a company (“C”) is entitled to a single-dwelling interest in a dwelling and another person (“P”) who is connected with C is entitled to a different single-dwelling interest in the same dwelling, this Part has effect—
in relation to C as if C were on that day entitled to P's single-dwelling interest as well as C's single-dwelling interest, and
(if P is a company) in relation to P as if P were on that day entitled to C's single-dwelling interest as well as P's single-dwelling interest.
This subsection provides for an exception to subsection (1). Where P is an individual, C is not treated ... as entitled to P's single-dwelling interest on the relevant day unless on that day C is entitled to a single-dwelling interest in the dwelling that is a freehold or leasehold interest with a taxable value of more than £250,000.
If on any day a single-dwelling interest (“the scheme interest”) is held for the purposes of a collective investment scheme and a person (“P”) who is connected with the scheme is entitled to a different single-dwelling interest in the same dwelling, this Part has effect—
in relation to the scheme, as if both those separate interests were on that day held for the purposes of the scheme, and
(if P is a company) in relation to P as if P were on that day entitled to the scheme interest as well as P's single-dwelling interest.
Subsection (2B) applies in any case where—
C would (without subsection (2B)) be treated, as a result of subsection (1) (read with section 109), as entitled to a single-dwelling interest with a taxable value (on the relevant day) of more than £2 million, but
C would not be so treated if the value specified in subsection (2) were £500,000 (instead of £250,000).
Subsection (2) has effect as if the value specified in it were £500,000 (instead of £250,000).
If on any day a single-dwelling interest in a dwelling is held for the purposes of a collective investment scheme (“the first scheme”) and another interest in the same dwelling is held for the purposes of another collective investment scheme (“the second scheme”) that is connected with the first scheme, this Part has effect—
in relation to the first scheme, as if both the interests were held on that day for the purposes of that scheme, and
in relation to the second scheme, as if both interests were held on that day for the purposes of that scheme.
See also—
section 97, for provision about the liability to tax of persons treated under this section (read with section 104) as jointly entitled to a single-dwelling interest;
paragraph 55 of Schedule 33, for provision about returns in cases involving joint entitlement.
The provisions mentioned in subsection (5) are to be read as including corresponding provision for cases where the same single-dwelling interest is treated under this section as held—
for the purposes of different collective investment schemes, or
by a company and for the purposes of a collective investment scheme.
In the application of this section to Scotland—
the reference to a freehold interest is to the interest of the owner;
the reference to a leasehold interest is to a tenant's right over or interest in property subject to a lease.
References in section 110 to a person do not include—
a public body, as defined in section 153,
a body listed in section 154(2) (bodies established for national purposes).
Subsections (1) to (4) of section 110 do not apply in relation to a single-dwelling interest if—
the day in question is relievable with respect to that interest by virtue of section 150 (providers of social housing),
by virtue of section 151 (charitable companies) the ownership condition is regarded as not met with respect to the interest on that day, or
the taxable value of the interest on that day is taken to be zero by virtue of section 155 (dwelling conditionally exempt from inheritance tax).
Subsection (4) applies where the separate interests (the “relevant interests”) that under section 110 (or that section and section 109) are treated as constituting, on a day, just one single-dwelling interest (“the combined interest”) include—
a freehold or leasehold interest, and
a leasehold interest (“the inferior interest”) granted out of that interest.
If the inferior interest is the most inferior relevant interest, the combined interest, and the dwelling itself (where relevant), are regarded for the purposes of the relevant relieving provisions as being exploited, on the day mentioned in subsection (3), in the way the inferior interest is exploited on that day.
If the inferior interest is an interest in part only (“the sub-let part”) of the land that is the subject-matter of the combined interest, subsection (4) has effect in relation to the combined interest only so far as that interest relates to the sub-let part.
In this section “the relevant relieving provisions” means sections 132 to 150.
The inferior interest counts as “the most inferior relevant interest” if no relevant interest (see subsection (3)) is a leasehold interest granted out of it.
In this section the reference to a leasehold interest includes the interest of a lessee under an agreement for a lease.
In the application of this section to Scotland—
the reference to a freehold interest is to the interest of the owner;
the reference to a leasehold interest is to a tenant's right over or interest in property subject to a lease;
the reference to an agreement for lease includes missives of let.
A building or part of a building counts as a dwelling at any time when—
it is used or suitable for use as a single dwelling, or
it is in the process of being constructed or adapted for such use.
Land that is, or is at any time intended to be, occupied or enjoyed with a dwelling as a garden or grounds (including any building or structure on such land) is taken to be part of that dwelling at that time.
Land that subsists, or is at any time intended to subsist, for the benefit of a dwelling is taken to be part of the dwelling at that time.
A building, or part of a building, used for a purpose specified in section 116(2) or (3) of FA 2003 is not used as a dwelling for the purposes of subsection (1).
Where a building, or part of a building, is used for a purpose mentioned in subsection (4), no account is to be taken for the purposes of subsection (1) of its suitability for any other use.
If a building or part of a building becomes temporarily unsuitable for use as a dwelling for any reason (including accidental damage, repairs or any other physical change to the building or its environment), that temporary unsuitability is ignored in determining whether or not the building or part of a building is, during the period in question, a dwelling for the purposes of this Part. This subsection does not affect any of the provisions in sections 126 to 131.
Subsection (2) applies where—
a contract is entered into for the acquisition of a chargeable interest in or over land that consists of or includes a building, or part of a building, that is to be constructed or adapted for use as a single dwelling,
substantial performance is treated as constituting the acquisition of the chargeable interest (under section 122), and
construction or adaptation of the building, or the part of a building, has not begun by the time the contract is substantially performed.
The chargeable interest deemed to be acquired as mentioned in subsection (1)(b) is taken to be in or over land that consists of or (as appropriate) includes a dwelling.
If at any time after the substantial performance of the contract the obligation under the contract to carry out the construction or adaptation ceases to have effect without the construction or adaptation having been begun, subsection (2) ceases to apply at that time.
A building or part of a building used for a purpose specified in section 116(2) or (3) of FA 2003 is not used as a dwelling for the purposes of subsection (1).
In this section—
“relative” means brother, sister, ancestor or lineal descendant;
Chapter 6 (trade profits: receipts) is amended as follows.
In Chapter 9 (trade profits: sound recordings), after section 130 insert—
In Chapter 11 (trade profits: other specific trades), before section 149 (and the italic heading preceding it) insert—
In Chapter 14 (disposal and acquisition of know-how), before section 192 insert—
In Chapter 16A (oil activities), before section 225A (and the italic heading preceding it) insert—
Chapter 18 (post-cessation receipts) is amended as follows. In section 246 (basic meaning of “post-cessation receipt”), after subsection (2) insert— . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
In Schedule 4 to CTA 2009 (index of defined expressions), omit the following entries— “ capped R&D expenditure (in Part 13) ”, “ qualifying Chapter 3 expenditure (in Part 13) ”, “ qualifying Chapter 4 expenditure (in Part 13) ”, and “ qualifying Chapter 5 expenditure (in Part 13) ”.
Sections 1217 and 1218 of CTA 2009 are renumbered as follows— In the following provisions of CTA 2009, for “section 1218” substitute “ section 1218B ” section 985(3), section 999(4), section 1000(3), section 1013(3), and section 1021(3). In Schedule 4 to CTA 2009— In section 18 of CAA 2001, for “section 1218” substitute “ section 1218B ”.
The Treasury may by regulations provide that a club is not entitled to be registered as a community amateur sports club under section 658 of CTA 2010 unless it meets one or more conditions relating to income received by the club. The provision that may be made by regulations under this paragraph includes, in particular— “Specified” means specified in the regulations. Regulations made under this paragraph may— A statutory instrument that contains (whether alone or with other provisions) regulations under this paragraph may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, the House of Commons.
There are 5 automatic overseas tests.
In section 577 (territorial scope of charges in respect of miscellaneous income), after subsection (2) insert—
After section 95 insert—
CTA 2010 is amended as follows. In section 312 (ring fence expenditure supplement: qualifying pre-commencement expenditure), omit subsections (8) and (9). In section 1173, in Part 1 of the table in subsection (2), omit the entry relating to section 1083(5) of CTA 2009. In Schedule 1, omit paragraph 671.
The first automatic overseas test is that—
P was resident in the UK for one or more of the 3 tax years preceding year X,
the number of days in year X that P spends in the UK is less than 16, and
P does not die in year X.
After section 96 insert—
In section 13 of F(No.3)A 2010, omit subsections (4) and (5).
The second automatic overseas test is that—
P was resident in the UK for none of the 3 tax years preceding year X, and
the number of days that P spends in the UK in year X is less than 46.
After section 97 insert—
FA 2012 is amended as follows. In section 78(3), omit the entry relating to section 1080(2) of CTA 2009. In Schedule 16, omit paragraph 190.
The third automatic overseas test is that— A day falls within this sub-paragraph if— Take the following steps to work out whether P works “sufficient hours overseas” as assessed over year X— Step 1 Identify any days in year X on which P does more than 3 hours’ work in the UK, including ones on which P also does work overseas on the same day. The days so identified are referred to as “disregarded days”. Step 2 Add up (for all employments held and trades carried on by P) the total number of hours that P works overseas in year X, but ignoring any hours that P works overseas on disregarded days. The result is referred to as P’s “net overseas hours”. Step 3 Subtract from 365 (or 366 if year X includes 29 February)— the total number of disregarded days, and any days that are allowed to be subtracted, in accordance with the rules in paragraph 28 of this Schedule, to take account of periods of leave and gaps between employments. The result is referred to as the “reference period”. Step 4 Divide the reference period by 7. If the answer is more than 1 and is not a whole number, round down to the nearest whole number. If the answer is less than 1, round up to 1. Step 5 Divide P’s net overseas hours by the number resulting from step 4. If the answer is 35 or more, P is considered to work “sufficient hours overseas” as assessed over year X. This paragraph does not apply to P if—
Section 105 (industrial development grants) is amended as follows. In subsection (2), at the end of paragraph (a) insert “ (but see subsection (2A)) ”. After that subsection insert—
The fourth automatic overseas test is that— P’s case falls within this sub-paragraph if—
The fifth automatic overseas test is that— P’s case falls within this sub-paragraph if— The relevant modifications of paragraph 14 are—
“relevant accounting period” means an accounting period which ends on or after 20 March 2013.
Section 524 (no charge in respect of exercise of option) is amended as follows. In subsection (2B) for paragraph (a) substitute—. After subsection (2B) insert— In subsection (2C) for “(2B)” substitute “ (2B)(a)(i) ”. After subsection (2C) insert—
Part 3 of Schedule 2 (eligibility of individuals) is amended as follows.
In section 1 of CAA 2001 (capital allowances), after subsection (3) insert—
In Chapter 3 of Part 5 of TCGA 1992 (entrepreneurs' relief) section 169I (material disposal of business assets) is amended as follows. In subsection (5) for “or B” substitute “ , B, C or D ”. After subsection (7) insert—
In Chapter 4 of Part 8 of CTA 2010 (oil activities: calculation of profits), after section 298 insert—
A person who has delivered a return may amend the return by notice to an officer of Revenue and Customs. The Commissioners for Her Majesty’s Revenue and Customs may require that notices under this paragraph— An amendment under this paragraph must be made by the end of the next chargeable period after the chargeable period to which the return relates (but see the exception that follows). If a return is delivered on or after 1 January in the chargeable period next after that to which it relates, the latest time for amending the return under this paragraph is the end of the period of 3 months after the day on which the return is delivered.
The duty under paragraph 5 to preserve records may be satisfied—
by preserving them in any form and by any means, or
by preserving the information contained in them in any form and by any means, subject to any conditions or exceptions specified in writing by the Commissioners for Her Majesty’s Revenue and Customs.
An enquiry extends to anything contained in the return, or required to be contained in the return, that relates— Sub-paragraph (3) applies if the notice of enquiry is given as a result of the amendment of a return under paragraph 3 (amendment by person making the return)— The enquiry is limited to—
An officer of Revenue and Customs or the relevant person may withdraw a notice of referral under paragraph 11.
Where the question to be referred under paragraph 11 is of the market value of any single-dwelling interest, the referral is to be made to— In any other case a referral under paragraph 11 is to be made to— References to “the tribunal” in paragraphs 11 and 13 are to be read accordingly.
If after an HMRC determination has been made P delivers a return for the chargeable period with respect to the interest in question, 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 yet been paid.
In FA 1916, omit section 63 (exemption from taxation of municipal securities issued in America).
Part 2 of TIOPA 2010 (double taxation relief) is amended as follows.
Schedule 56 (penalty for failure to make payments on time) to FA 2009 is amended in accordance with paragraphs 11 to 14.
Paragraph 3 of Schedule 53 to FA 2009 (late payment interest start date: amendments and discovery assessments etc) is amended as follows. In sub-paragraph (3)— In the case of a person (“P”) who failed to give notice in accordance with a requirement under section 7 of TMA 1970 that arose by virtue of subsection (1B) of that section, the reference in sub-paragraph (1)(c) to an assessment which ought to have been made by P is a reference to the assessment which P would have been required to make if no notice relating to the year of assessment concerned had been withdrawn under section 8B of that Act.
In paragraph 1 (penalty for failure to pay tax), in sub-paragraph (4), for the words from “the date on which” to the end substitute “the day after the date specified in or for the purposes of column 4 of the Table in relation to that amount.”
In Schedule 55 to that Act (penalty for failure to make returns etc), after paragraph 17 insert—
Part 5 of Schedule 4 (requirements etc relating to share options) is amended as follows.
In paragraph 13 (introduction)—
after the entry for paragraph 18 insert “ and ”, and
omit the entry for paragraph 19 and the “and” before it.
In section 59 of CAA 2001 (unrelieved qualifying expenditure), after subsection (3) insert—
Chapter 2 (double taxation relief by way of credit) is amended as follows.
In paragraph 21 (introduction) in sub-paragraph (2)—
after the entry for paragraph 24 omit “or”, and
paragraph 25A (exercise of options: company events)
In paragraph 14 (time of eligibility to participate) in sub-paragraph (7)—
after paragraph (b) insert “ and ”, and
omit paragraph (c) and the “and” before it.
In Chapter 5 of Part 2 of CAA 2001 (plant and machinery allowances and charges), after section 66 insert—
In section 42 (limit on credit against corporation tax) after subsection (4) insert—
Paragraph 6 (amount of penalty: PAYE and CIS amounts) is amended as follows. P is liable to a penalty under this paragraph, in relation to each tax, each time that P makes a default in relation to a tax year. In sub-paragraph (2)— But where a failure to make one of those payments (or to pay an amount comprising two or more of those payments) would, apart from this sub-paragraph, constitute the first default in relation to a tax year, that failure does not count as a default in relation to that year for the purposes of a penalty under this paragraph. The amount of the penalty for a default made in relation to a tax year is determined by reference to— If the default is P’s 1st, 2nd or 3rd default in relation to the tax year, P is liable, at the time of the default, to a penalty of 1% of the amount of tax comprised in the default. If the default is P’s 4th, 5th or 6th default in relation to the tax year, P is liable, at the time of the default, to a penalty of 2% of the amount of tax comprised in the default. If the default is P’s 7th, 8th or 9th default in relation to the tax year, P is liable, at the time of the default, to a penalty of 3% of the amount of tax comprised in the default. If the default is P’s 10th or subsequent default in relation to the tax year, P is liable, at the time of the default, to a penalty of 4% of the amount of tax comprised in the default. In sub-paragraph (8), for paragraph (b) substitute— Regulations made by the Commissioners for Her Majesty’s Revenue and Customs may specify— Regulations under sub-paragraph (8A) may—
After paragraph 9 insert—
After paragraph 25 insert—
Omit paragraphs 19 to 24 (the “no material interest” requirement).
After section 49 insert—
In Part 6 of Schedule 4 (exercise of share options) paragraph 26 (exchange of options on company reorganisation) is amended as follows. In sub-paragraph (2)(c)— After sub-paragraph (2) insert— A CSOP scheme approved before the day on which this Act is passed which contains provision under paragraph 26 of Schedule 4 to ITEPA 2003 has effect with any modifications needed to reflect the amendments made by this paragraph.
In Part 11 of Schedule 2 (supplementary provisions) in paragraph 100 (index of defined expressions), in the entry for “close company”, omit “(and see paragraph 20(4))”.
In Chapter 3 (miscellaneous provisions), section 112 (deduction from income for foreign tax (instead of credit against UK tax)) is amended as follows. After subsection (3) insert— In subsection (6), for “subsection (1)” substitute “this section”.
Paragraph 11 (assessment of penalty) is amended as follows. If an assessment in respect of a penalty is based on an amount of tax due or payable that is found by HMRC to be excessive, HMRC may by notice to P amend the assessment so that it is based upon the correct amount. An amendment made under sub-paragraph (4A)— Omit sub-paragraph (5).
The amendments made by paragraphs 33 to 37 above have effect for the purpose of determining whether an individual is eligible to participate in an award of shares on the day on which this Act is passed or any later day. A SIP approved before the day on which this Act is passed has effect accordingly with the omission of any provision falling within a provision of Schedule 2 to ITEPA 2003 omitted by those paragraphs.
The Treasury may by order amend this Part so as to specify cases where use of a building is to be use of a building as a dwelling for the purposes of section 112(1) or 113(1).
The reference in section 116(8)(a) of FA 2003 (power to amend section 116(2) and (3)) to “the purposes of subsection (1)” includes a reference to the purposes of sections 112(1) and 113(1).
The fact that a part of a building is suitable for use as a dwelling does not prevent that part from forming part of a larger single dwelling.
The fact that a building or structure that is— is itself suitable for use as a single dwelling does not prevent it from being treated (in accordance with section 112(2)) as part of the dwelling.
in the garden or grounds of a dwelling, and
occupied or enjoyed with the dwelling,
Subsection (4) applies where the conditions in subsection (2) are met in relation to two dwellings (the “main dwelling” and the “associated dwelling”) on a day (“the day in question”) in a chargeable period.
The conditions are that—
the main dwelling has a garden or grounds,
the associated dwelling stands within the garden or grounds of the main dwelling, but is not occupied or enjoyed with that dwelling,
the associated dwelling does not have separate access, and is not part of the same building as the main dwelling, and
the common ownership condition is met.
The common ownership condition is that— (It does not matter whether or not the interest in the main dwelling and the interest in the associated dwelling are held for the same title.)
a company is entitled to a chargeable interest in the main dwelling, and the company or a person connected with the company is entitled to a chargeable interest in the associated dwelling, or
a chargeable interest in the main dwelling is held for the purposes of a collective investment scheme, and a chargeable interest in the associated dwelling is held for the purposes of the same collective investment scheme.
This Part has effect in relation to the interests mentioned in paragraph (a) or (as the case may be) (b) of subsection (3) as if the main dwelling and the associated dwelling were, on the day in question, suitable for use as a single dwelling.
Subsection (4) does not apply if—
the day in question is, in relation to the interest in the main dwelling or the interest in the associated dwelling, relievable by virtue of a provision mentioned in subsection (6), or
the ownership condition is, by virtue of section 151 (charitable companies), regarded as not being met on that day with respect to one or other of those interests.
Those provisions are— section 133 (property rental businesses); section 134 (rental property: preparation for sale etc); section 137 (dwellings opened to the public); section 138 (property developers); section 139 (property developers: exchange of dwellings); section 141 (property traders); section 143 (financial institutions acquiring dwellings in the course of lending); section 144A (regulated home reversion plans); section 145 (occupation by employees or partners of a qualifying trade or property rental business ); section 147A (caretaker flat owned by management company); section 148 (farmhouses); section 150 (providers of social housing).
The reference in subsection (3)(a) to a person connected with the company does not include a public body (as defined in section 153) or a body listed in section 154(2) (bodies established for national purposes).
The reference in subsection (3)(b) to a chargeable interest being held for the purposes of the same collective investment scheme includes a reference to a person connected with the scheme being entitled to the interest.
The associated dwelling has “separate access” only if—
there is access to the associated dwelling directly from a highway (in Scotland, a road) that the dwelling adjoins, or
the person entitled to possession of the associated dwelling has access to that dwelling from a highway (in Scotland, a road), exclusively by passing over land that the person is entitled to pass over by reason of one or more rights of way or other interests in land to which the person is separately entitled.
In this section—
Two parts of a building are “linked dwellings” if—
each of them counts as a dwelling,
there is private access between the two dwellings,
the two parts of the building are not (together) used or suitable for use as a single dwelling, and
the common ownership condition and the use condition are met.
The common ownership condition is that— (It does not matter whether or not the interests are held for the same title.)
a company is entitled to a chargeable interest in one of the dwellings, and the company or a person connected with the company is entitled to a chargeable interest in the other dwelling, or
a chargeable interest in one of the dwellings is held for the purposes of a collective investment scheme, and a chargeable interest in the other dwelling is held for the purposes of the same collective investment scheme.
If on a day in a chargeable period (“the day in question”) two parts of a building constitute linked dwellings, this Part has effect in relation to the interests mentioned in paragraph (a) or (as the case may be) (b) of subsection (2) as if the two parts were, on the day in question, suitable for use as a single dwelling.
Subsection (3) does not apply if—
the day in question is, in relation to a chargeable interest mentioned in subsection (2)(a) or (as the case may be) (2)(b), relievable by virtue of a provision mentioned in subsection (5), or
(in a case where paragraph (a) of subsection (2) applies) the ownership condition is, by virtue of section 151 (charitable companies), regarded as not being met on that day with respect to one or other of the chargeable interests mentioned in that paragraph.
Those provisions are— section 133 (property rental businesses); section 134 (rental property: preparation for sale etc); section 137 (dwellings opened to the public); section 138 (property developers); section 139 (property developers: exchange of dwellings); section 141 (property traders); section 143 (financial institutions acquiring dwellings in the course of lending); section 144A (regulated home reversion plans); section 145 (occupation by employees or partners of a qualifying trade or property rental business ); section 147A (caretaker flat owned by management company); section 148 (farmhouses); section 150 (providers of social housing).
The reference in subsection (2)(a) to a person connected with the company does not include a public body (as defined in section 153) or a body listed in section 154(2) (bodies established for national purposes).
If two dwellings in a building (dwelling A and dwelling B) are treated under this section as suitable for use as a single dwelling, and dwelling B and a third dwelling in the building (“dwelling C”) are treated under this section as suitable for use as a single dwelling, all three are treated as suitable for use as a single dwelling (and so on).
The reference in section 117(2)(b) to a chargeable interest being held for the purposes of the same collective investment scheme includes a reference to a person connected with the scheme being entitled to the interest.
For the purposes of section 117, there is private access between two dwellings if the person entitled to possession of each dwelling is entitled, by reason of a right of way or other interest in land, to have access to that person's dwelling from the other dwelling, without passing over any part of the building (or any other land) in which a third party has an interest entitling that third party to enter it.
In subsection (2) “third party” means a person other than—
the persons entitled to possession of the dwellings mentioned in subsection (2), and
persons connected with any of them.
The use condition mentioned in section 117(1)(d) is that each of the two dwellings—
is occupied (or usually occupied) by a relevant individual,
is intended to be so occupied (or usually so occupied), or
is not occupied.
In subsection (4) “relevant individual” means—
an individual connected with the company mentioned in section 117(2)(a),
an individual connected with the collective investment scheme mentioned in section 117(2)(b),
an individual who occupies (or is to occupy) the dwelling concerned otherwise than on commercial terms, or
an individual who is employed wholly or partly in connection with the occupation by a person falling within any of paragraphs (a) to (c) of a dwelling in the building, or provides services in connection with such a person's occupation of a dwelling in the building.
In this section references to the person entitled to possession of a dwelling are to the person entitled to possession of the dwelling by reason of an estate or interest held by that person.
Any structure (such as a terrace of houses or a pair of semi-detached houses) that is composed of or includes dwellings is regarded as a building for the purposes of sections 117 and 118.
References in this Part to the acquisition of a chargeable interest include any acquisition however effected (including an acquisition effected by the act of parties to a transaction, by order of a court or other authority, by or under any statutory provision or by operation of law).
The surrender or release of a chargeable interest is—
an acquisition of that interest by any person whose interest or right is benefited or enlarged by the transaction, and
a disposal by the person ceasing to be entitled to that interest.
The variation of a chargeable interest is—
an acquisition of a chargeable interest by the person benefiting from the variation, and
a disposal of a chargeable interest by the person whose interest is subject to or limited by the variation.
A person who acquires a chargeable interest in or over land that consists of or includes a dwelling is treated for the purposes of this Part as acquiring the interest on the effective date of the acquisition (and therefore as entitled to the interest with effect from that date: see section 171).
A person who disposes of a chargeable interest in or over land that consists of or includes a dwelling is treated for the purposes of this Part as ceasing to be entitled to the interest on the effective date of the disposal (and therefore as not being entitled to the interest on that day: see section 171).
If a person's acquisition and disposal of a chargeable interest are completed on the same day, then for the purposes of this Part—
the person's acquisition of the interest is ignored if it precedes the disposal;
the person's disposal of the interest is ignored if it precedes the acquisition.
The effective date of an acquisition of a chargeable interest is—
the date on which the acquisition is completed, or
any alternative date the Commissioners for Her Majesty's Revenue and Customs may prescribe by regulations.
The effective date of a disposal of a chargeable interest is—
the date on which the disposal is completed, or
any alternative date the Commissioners for Her Majesty's Revenue and Customs may specify by regulations.
This section applies where a person (“P”) enters into a contract under which—
P is to acquire a relevant chargeable interest, and
the acquisition is to be completed by a conveyance.
P is not regarded as acquiring any chargeable interest by reason of entering into the contract.
If the contract is substantially performed without having been completed, this Part has effect as if the substantial performance of the contract were the completion of the acquisition provided for by the contract.
Accordingly, where subsection (3) applies and the contract is subsequently completed by a conveyance, that completion is not treated for the purposes of section 102 (taxable value) as effecting the acquisition of a chargeable interest.
Where subsection (3) applies and— this Part has effect as if P had at the relevant time disposed of the chargeable interest referred to in subsection (1)(a).
the contract is afterwards rescinded or annulled, or
performance of the contract is for any other reason terminated before the contract has been carried fully into effect,
In subsection (5) “the relevant time” means—
the time when the rescission or annulment takes effect, or
(as the case requires) the time when performance of the contract ceases.
Where subsection (3) applies and the contract is afterwards varied (or partially rescinded) so that the chargeable interest to be acquired under the contract is not the same as the chargeable interest to which the contract originally related, this Part (including subsection (3)) has effect as if the variation of the contract effected—
the disposal by P of the chargeable interest referred to in subsection (1)(a), and
the substantial performance of the contract, as varied.
If the parties to the contract proceed as if they had varied the contract in the way mentioned in subsection (7) (without actually doing so), subsection (7) applies as if they had actually made the corresponding variation in the terms of the contract.
In this section—
references to completion are to the completion of the acquisition proposed, whether or not between the original parties;
“contract” includes any agreement;
“conveyance” includes any instrument;
“relevant chargeable interest” means a chargeable interest in or over land that consists of or includes a dwelling;
“substantially performed” has the same meaning as in section 44 of FA 2003.
This section applies where a person (“V”) enters into a contract under which—
V is to dispose of a relevant chargeable interest, and
the disposal is to be completed by a conveyance.
V is not regarded as disposing of a chargeable interest by reason of entering into the contract.
If the contract is substantially performed without having been completed, this Part has effect as if the substantial performance of the contract were the completion of the disposal provided for by the contract.
Accordingly, where subsection (3) applies and the contract is subsequently completed by a conveyance, that completion is not treated for the purposes of section 102 as effecting the disposal of a chargeable interest.
Where subsection (3) applies and— this Part has effect as if V had at the relevant time re-acquired the chargeable interest referred to in subsection (1)(a).
the contract is afterwards rescinded or annulled, or
performance of the contract is for any other reason terminated before the contract has been carried fully into effect,
In subsection (5) “the relevant time” means—
the time when the rescission or annulment takes effect, or
(as the case requires) the time when performance of the contract ceases.
Where subsection (3) applies and the contract is afterwards varied (or partially rescinded) so that the chargeable interest to be disposed of under the contract is not the same as the chargeable interest to which the contract originally related, this Part (including subsection (3)) has effect as if the variation of the contract effected—
the re-acquisition by V of the chargeable interest referred to in subsection (1)(a), and
the substantial performance of the contract, as varied.
If the parties to the contract proceed as if they had varied the contract in the way mentioned in subsection (7) (without actually doing so), subsection (7) applies as if they had actually made the corresponding variation in the terms of the contract.
In this section—
references to completion are to the completion of the disposal proposed, between the same parties, in substantial conformity with the contract;
“contract” includes any agreement;
“conveyance” includes any instrument;
“relevant chargeable interest” means a chargeable interest in or over land that consists of or includes a dwelling;
“substantially performed” has the same meaning as in section 44 of FA 2003.
Where a new dwelling is being or has been constructed (whether or not as part of a larger building) the earlier of the following days is a valuation date in the case of a single-dwelling interest in that dwelling—
the completion day;
the day on which the dwelling is first occupied.
The reference in subsection (1) to the construction of a new dwelling—
includes the production of a new dwelling by the alteration (whether structural or otherwise) of an existing building, but
does not include a case to which section 125 (dwellings produced from other dwellings) or section 128 (demolition and replacement: new dwellings) applies.
The reference in subsection (1) to the “completion day” is to the day on which the new dwelling is treated as having come into existence for the purposes of—
Part 1 of the Local Government Finance Act 1992 (council tax: England and Wales) (see section 17 of that Act), or
Part 2 of that Act (council tax: Scotland) (see section 83 of that Act), or
the Rates (Northern Ireland) Order 1977 (S.I. 1977/2157 (N.I. 28)) (see Article 25B of that Order).
In this section “building” includes a part of a building.
This section applies where an existing building that is a dwelling or dwellings (“the old dwelling” or “the old dwellings”) becomes a different dwelling or dwellings ( “ new ” dwellings) as a result of structural alteration.
Any question as to whether or not a person has a single-dwelling interest at any time either in the old dwelling or dwellings or in a new dwelling is determined on the assumption that the old dwelling or dwellings cease to exist, and any new dwelling come into existence, only when the conversion is completed.
The day after the conversion is completed is a valuation date in the case of any single-dwelling interest in a new dwelling.
References to when the conversion is completed are to the end of the day on which the new dwelling is treated as having come into existence (or the first day on which all the new dwellings are treated as having come into existence) for the purposes of—
Part 1 of the Local Government Finance Act 1992 (council tax: England and Wales) (see section 17 of that Act), or
Part 2 of that Act (council tax: Scotland) (see section 83 of that Act), or
the Rates (Northern Ireland) Order 1977 (S.I. 1977/2157 (N.I. 28)) (see Article 25B of that Order).
In this section “building” includes a part of a building.
This section and sections 127 to 129 apply where a building that is a dwelling (“the old dwelling”) is demolished after 1 April 2013.
Except so far as express provision to the contrary is made in sections 127 to 129, any question as to whether a person has a single-dwelling interest in the dwelling, and any question as to the taxable value of such an interest, is determined as if the dwelling had not been demolished.
For the purposes of subsection (1) the demolition of a building is treated as having occurred after 1 April 2013 if a day after 1 April 2013 is the first day on which—
the demolition has begun, and
as a result, the building is no longer suitable for use as a dwelling.
In this section “building” includes a part of a building.
Subsection (2) applies if a person entitled to a single-dwelling interest in the old dwelling notifies an officer of Revenue and Customs that to the best of the person's knowledge there is no proposal to construct any dwelling or dwellings on the site of the old dwelling.
Any question as to whether a person has a single-dwelling interest in the old dwelling is determined on the assumption that the old dwelling ceases (or ceased) to exist with effect from the end of the day mentioned in subsection (3).
That day is the first day on which—
the demolition has begun, and
as a result, the building in question is no longer suitable for use as a dwelling.
A notification under subsection (1) must be given—
in an annual tax on enveloped dwellings return, or
by amending such a return.
In this section—
“building” includes part of a building;
“the site of the old dwelling” means the land on which the dwelling stood and that counted as part of the dwelling;
the reference to the construction of a dwelling or dwellings on that site is to the construction of a dwelling or dwellings wholly or partly on the site.
Subsection (2) applies if one or more dwellings (referred to below as “new dwellings”) are constructed on the site of the old dwelling after the demolition.
Any question as to whether or not a person has a single-dwelling interest at any time either in the old dwelling or in a new dwelling is determined on the assumption that the old dwelling ceases to exist, and the new dwellings come into existence, only when the rebuilding is completed.
The day after the rebuilding is completed is a valuation date in the case of any single-dwelling interest in a new dwelling.
In subsection (1)—
“the site of the old dwelling” means the land on which the dwelling stood and that counted as part of the dwelling;
the reference to the construction of a dwelling on that site is to the construction of a dwelling wholly or partly on the site.
References to when the rebuilding is completed are to the end of whichever of the following days is earlier—
the completion day;
the day on which the last of the new dwellings to be occupied is first occupied.
The reference in subsection (5) to the “completion day” is to the day on which the new dwelling is treated as having come into existence (or the first day on which all the new dwellings are treated as having come into existence) for the purposes of—
Part 1 of the Local Government Finance Act 1992 (council tax: England and Wales) (see section 17 of that Act), or
Part 2 of that Act (council tax: Scotland) (see section 83 of that Act), or
the Rates (Northern Ireland) Order 1977 (S.I. 1977/2157 (N.I. 28)) (see Article 25B of that Order).
This section applies if—
a building is constructed on the site of the old dwelling after the demolition, and
section 128 does not apply.
Any question as to whether a person has a single-dwelling interest in the old dwelling is determined on the assumption that the old dwelling ceases to exist on the day after—
the day on which the change of use is approved, or
if later, the day on which the old dwelling ceased to be occupied.
In subsection (1)—
“the site of the old dwelling” means the land on which the dwelling stood and that counted as part of the dwelling;
the reference to the construction of a dwelling on that site is to the construction of a dwelling wholly or partly on the site.
This section applies where a building or part of a building—
has been suitable for use as a dwelling, and
is altered for the purpose of making it suitable for use otherwise than as a dwelling.
The question whether or not the alterations make the building or part unsuitable for use as a dwelling is one of fact (but see subsection (3)).
The building or part will not be regarded as having become unsuitable for use as a dwelling as a result of the alterations at any time unless by that time any planning permission , development consent or infrastructure consent required for the alterations has been granted (and the alterations have been made in accordance with any such permission or consent).
In this section “planning permission” has the meaning given by the relevant planning enactment.
“The relevant planning enactment” means—
in relation to land in England and Wales, section 336(1) of the Town and Country Planning Act 1990;
in relation to land in Scotland, section 277(1) of the Town and Country Planning (Scotland) Act 1997;
in relation to land in Northern Ireland, Article 2(2) of the Planning (Northern Ireland) Order 1991 (S.I. 1991/1220 (N.I. 11)).
In this section—
“development consent” means development consent under the Planning Act 2008.
“infrastructure consent” means infrastructure consent under the Infrastructure (Wales) Act 2024.
This section applies where a dwelling is damaged so as to be temporarily unsuitable for use as a dwelling.
The unsuitability for use as a dwelling is taken into account in applying the definition of “dwelling” for the purposes of this Part (see section 112) only if the first and second conditions are met.
The first condition is that the damage is—
accidental, or
otherwise caused by events beyond the control of the person entitled to the single-dwelling interest.
The second condition is that, as a result of the damage, the building concerned is unsuitable for use as a dwelling for at least 90 consecutive days.
Where the first and second conditions are met—
the entire period of unsuitability for use as a dwelling (including the first 90 days) is taken into account in applying the definition of “dwelling”, and
work done in that period to restore the building to suitability for use as a dwelling does not count, for the purposes of section 112 or 113, as construction or adaptation of the building for use as a dwelling.
The first condition is regarded as not being met if the damage occurs in the course of work that—
is done for the purpose of altering the dwelling (or a building of which it forms part), and
itself involves, or could be expected to involve, making the building unsuitable for use as a dwelling for 30 days or more.
In this section—
references to alteration include partial demolition;
references to a building include a part of a building.
In this section references to damage include damage done before 1 April 2013; and days before 1 April 2013 may be taken into account for the purposes of subsection (4).
Subsection (2) applies where tax is charged, in respect of a single-dwelling interest, for a chargeable period that includes one or more days that are relievable as a result of any of the provisions listed in subsection (3) (or for more than one such period).
For any such period, the adjusted chargeable amount is to be calculated on the basis that the chargeable person is not within the charge with respect to the interest on any relievable day.
The provisions are— section 133 (property rental businesses); section 134 (rental property: preparation for sale etc); section 137 (dwellings opened to the public); section 138 (property developers); section 139 (property developers: exchange of dwellings); section 141 (property traders); section 143 (financial institutions acquiring dwellings in the course of lending); section 144A (regulated home reversion plans); section 145 (occupation by employees or partners of a qualifying trade or property rental business ); section 147A (caretaker flat owned by management company); section 148 (farmhouses); section 150 (providers of social housing).
See also section 106 (adjustment of amount chargeable and claim for relief).
A day in a chargeable period is relievable in relation to a single-dwelling interest if on that day the interest—
is being exploited as a source of rents or other receipts (other than excluded rents) in the course of a qualifying property rental business carried on by a person entitled to the interest, or
steps are being taken to secure that the interest will, without undue delay, be so exploited in the course of a qualifying property rental business that is being carried on, or is to be carried on, by a person entitled to the interest.
A day is not relievable by virtue of subsection (1) or section 134 in the case of a single-dwelling interest if on that day a non-qualifying individual is permitted to occupy the dwelling.
In this Part “qualifying property rental business” means a property rental business that is run on a commercial basis and with a view to profit.
A business is a “property rental business” for the purposes of subsection (3) if it is a property business as defined in Chapter 2 of Part 4 of CTA 2009, but—
the question whether or not a business is a property rental business for the purposes of subsection (3) is determined without reference to whether or not any profits of the business are chargeable to corporation tax (and section 204(2) of CTA 2009 is therefore disregarded), and
for the purposes of this subsection the “rents or other receipts” referred to in section 207(1) of CTA 2009 are taken not to include excluded rents
In subsection (1)(b) “without undue delay” means without delay except so far as delay is justified by commercial considerations or cannot be avoided.
In this Part “excluded rents” means rents within any of classes 2 to 6 in the table in section 605(2) of CTA 2010.
A day (“day X”) on which a person (“P”) is entitled to a single-dwelling interest is relievable in relation to that interest if— First condition The first condition is that steps are being taken to secure that the interest will be sold without undue delay. Second condition The second condition is that— steps are being taken to secure that the dwelling will be demolished without undue delay, and if it is intended that a new dwelling will be constructed on the site of the existing dwelling, the intention is that it will be used in a relievable way. Third condition The third condition is that— steps are being taken to secure that the dwelling will be converted into a different dwelling without undue delay, and it is intended that the new dwelling will be used in a relievable way. Fourth condition The fourth condition is that steps are being taken to secure that the dwelling will be converted into a building other than a dwelling without undue delay.
on day X the dwelling is unoccupied and any of the first to fourth conditions is met (see below),
day X is preceded by one or more days (“qualifying days”) that are relievable under section 133 in relation to the interest and on which P, or a relevant partner, was entitled to the interest, and
the days (if any) between day X and the last of the qualifying days to precede day X are all relievable under this section.
A dwelling is “used in a relievable way” for the purposes of subsection (1) if the single-dwelling interest in question is exploited in such a way, or held in such a way and for such purposes, (or, as the case requires, the dwelling itself is exploited or used in such a way) that a day of such exploitation, ownership or use would be relievable under any of sections 133, 137, 145 and 148.
In this section— “relevant partner”, where P is (on day X) entitled to the interest as a member of a partnership, means a person who was at the time in question carrying on the qualifying rental property business concerned as a member of that partnership; “without undue delay” means without delay, except so far as delay is justified by commercial considerations or cannot be avoided.
Subsection (2) applies if on a day in a chargeable period (“the day of non-qualifying occupation”)—
a single-dwelling interest to which a person (“the landlord”) is entitled is being exploited as mentioned in section 133(1)(a), or steps are being taken to secure that the interest will be so exploited, as mentioned in section 133(1)(b), and
a non-qualifying individual is permitted to occupy the dwelling.
No subsequent day in that chargeable period, or in any of the subsequent 3 chargeable periods, that meets the continuity of ownership condition and would (in the absence of this subsection) be relievable by virtue of section 133(1)(b) is treated as relievable by virtue of that provision unless a day of qualifying use falls between that day and the day of non-qualifying occupation.
A day meets the continuity of ownership condition if on that day—
the landlord is entitled to the single-dwelling interest, or
if the landlord carried on or (as the case requires) intended to carry on the property rental business in partnership, another member of the partnership is entitled to the interest.
Subsection (5) applies if a person who is a non-qualifying individual in relation to a single-dwelling interest occupies the dwelling on a day in a chargeable period (“the day of non-qualifying occupation”).
An earlier day in that or the preceding chargeable period (“the earlier day”) is not relievable by virtue of section 133(1)(b) or 134 if a relevant person is entitled to the single-dwelling interest on that day.
In subsection (5) “relevant person” means—
a person who is entitled to the single-dwelling interest on the day of non-qualifying occupation, or
if a person falling within paragraph (a) is or has been a member of a partnership whose members have at any time exploited the single-dwelling interest as a source of rents and receipts in a property rental business, any other member of that partnership.
Subsection (5) does not apply in relation to the earlier day if a day that is relievable by virtue of section 133(1)(a) falls between that earlier day and the day of non-qualifying occupation.
For the purposes of this section—
“day of qualifying use”, in relation to a single-dwelling interest, means a day that is relievable in the case of the interest by virtue of section 133(1)(a);
occupation of any part of a dwelling is regarded as occupation of the dwelling.
In sections 133 and 135 “non-qualifying individual”, in relation to a single-dwelling interest, means any of the following—
an individual who is entitled to the interest (otherwise than as a member of a partnership),
an individual (“a connected person”) who is connected with a person entitled to the interest,
if a person is entitled to the interest as a member of a partnership, an individual who is, or is connected with, a qualifying member of that partnership,
an individual (“a relevant settlor”) who is the settlor in relation to a settlement of which a trustee is (in the capacity of trustee) connected with a person who is entitled to the interest,
the spouse or civil partner of a connected person or of a relevant settlor,
a relative of a connected person or of a relevant settlor, or the spouse or civil partner of a relative of a connected person or of a relevant settlor,
a relative of the spouse or civil partner of a connected person or of a relevant settlor,
the spouse or civil partner of a person falling within paragraph (g), or
an individual who is a major participant in a relevant collective investment scheme or is connected with a major participant in a relevant collective investment scheme.
In subsection (1)(c) “qualifying member”, in relation to a partnership, means a member of the partnership who is entitled to a 50% or greater share—
in the income profits of the partnership, or
in the partnership's assets.
In subsection (1)(i) “relevant collective investment scheme”, in relation to a single-dwelling interest, means a collective investment scheme that meets the ownership condition with respect to the interest.
A person who participates in a collective investment scheme is a “major participant” in the scheme if the person—
is entitled to a share of at least 50% either of all the profits or income arising from the scheme or of any profits or income arising from the scheme that may be distributed to participants, or
would in the event of the winding up of the scheme be entitled to 50% or more of the assets of the scheme that would then be available for distribution among the participants.
The reference in subsection (4)(a) to profits or income arising from the scheme is to profits or income arising from the acquisition, holding, management or disposal of the property subject to the scheme.
For the purposes of subsection (1), section 1122 of CTA 2010 (as applied by section 172) has effect as if subsections (7) and (8) of that section (application of rules about connected persons to partnerships) were omitted.
In this section—
In subsection (1)(d) “trustee” is to be read in accordance with section 1123(3) of CTA 2010 (“connected persons”: supplementary).
A day in a chargeable period is relievable in relation to a single-dwelling interest if the first or second condition is met on that day.
The first condition is that the dwelling is being exploited as a source of income in the course of a qualifying trade in the normal course of which the public are offered the opportunity to make use of, stay in or otherwise enjoy the dwelling as customers of the trade on least 28 days in any year.
The second condition is that steps are being taken to secure—
that the dwelling will (in that or a future chargeable period) be exploited as a source of income in the course of a qualifying trade such as is mentioned in subsection (2), and
that it will be so exploited without delay, except so far as delay is justified by commercial considerations or cannot otherwise be avoided.
In this section “qualifying trade” means a trade carried on on a commercial basis and with a view to profit.
For the purposes of this section persons are not taken to have an opportunity to make use of, stay in or otherwise enjoy a dwelling unless the areas that they are permitted to make use of, stay in or otherwise enjoy include a significant part of the interior of the dwelling.
The size (relative to the size of the whole dwelling), nature, and function of the area or areas concerned are to be taken into account in determining whether they form a significant part of the interior of the dwelling.
A day in a chargeable period is relievable in relation to a single-dwelling interest if on that day—
a person carrying on a property development trade (“the property developer”) is entitled to the interest, and
the interest is held exclusively for the purpose of developing and reselling the land in the course of the trade.
If the property developer holds an interest for the purpose mentioned in subsection (1)(b), any additional purpose the property developer may have of exploiting the interest as a source of rents or other receipts in the course of a qualifying property rental business (after developing the land and before reselling it) is treated as not being a separate purpose in applying the test in subsection (1)(b).
A day is not relievable by virtue of subsection (1) if on the day a non-qualifying individual is permitted to occupy the dwelling.
In this Part “property development trade” means a trade that—
consists of or includes buying and developing for resale residential or non-residential property, and
is run on a commercial basis and with a view to profit.
In this section references to development include redevelopment.
A day in a chargeable period is relievable in relation to a single-dwelling interest if—
a person (“the property developer”) is on that day entitled to a single-dwelling interest (“the returned interest”) that was acquired (by the relevant person) in the course of a property development trade, and
that acquisition (“the reverse acquisition”) was part of a qualifying exchange.
A day is not relievable by virtue of this section if on that day a non-qualifying individual is permitted to occupy the dwelling.
In this section “the relevant person” means—
if the property developer is entitled to the returned interest as a member of a partnership, the persons who acquired the interest as members of the partnership, or
otherwise, the property developer (and any person who acquired the returned interest jointly with the property developer).
The reverse acquisition is “part of a qualifying exchange” only if—
it was made by way of transfer,
the person from whom the acquisition was made itself acquired (by way of grant or transfer) a chargeable interest in or over a new dwelling from the relevant person, and
each of those acquisitions was entered into in consideration of the other.
A building or part of a building is a “new dwelling” if—
it has been constructed for use as a single dwelling and has not previously been occupied, or
it has been adapted for use as a single dwelling and has not been occupied since its adaptation.
Subsection (2) applies if on a day in a chargeable period—
a person carrying on a property development trade (“the property developer”) is entitled to a single-dwelling interest that has been acquired in the course of that trade (whether or not the acquisition was part of a qualifying exchange for the purposes of section 139), and
a non-qualifying individual is permitted to occupy the dwelling.
No subsequent day is relievable in the case of the single-dwelling interest by virtue of section 138(1) or 139(1) if—
the day falls within that chargeable period, or any of the subsequent 3 chargeable periods, and
there is continuity of ownership on that day.
There is “continuity of ownership” on any day on which—
the property developer is entitled to the single-dwelling interest, or
if the property developer carried on the property development trade in partnership, another member of the partnership is entitled to the interest.
Subsection (5) applies if—
on a day in a chargeable period (“the day of non-qualifying occupation”) a person who is a non-qualifying individual in relation to a single-dwelling interest is occupying the dwelling in question, and
on an earlier day in that, or the preceding, chargeable period (“the earlier day”) the conditions in section 138(1)(a) and (b) are met in relation to the same single-dwelling interest.
The earlier day is not relievable by virtue of section 138(1) in the case of the single-dwelling interest if—
a person who is entitled to the interest on the earlier day is also entitled to it on the day of non-qualifying occupation, or
if the trade mentioned in section 138(1) is carried on in partnership, a person who has at any time carried that business on in partnership is entitled to the interest on the day of non-qualifying occupation.
Subsection (7) applies if—
on a day in a chargeable period (“the day of non-qualifying occupation”) a person who is a non-qualifying individual in relation to a single-dwelling interest is occupying the dwelling in question, and
on an earlier day in that, or the preceding, chargeable period (“the earlier day”) the conditions in section 139(1)(a) and (b) are met in relation to the same single-dwelling interest.
The earlier day is not relievable by virtue of section 139(1) in the case of the single-dwelling interest if—
a person who is entitled to the interest on the earlier day is also entitled to it on the day of non-qualifying occupation, or
where the trade mentioned in section 139(1) is carried on in partnership, a person who has at any time carried that trade on in partnership is entitled to the interest on the day of non-qualifying occupation.
If a day that is relievable by virtue of section 133(1)(a) falls between the earlier day mentioned in subsection (5) or (as the case may be) (7) and the day of non-qualifying occupation, that subsection does not apply in relation to that earlier day.
For the purposes of sections 138 and 139 and this section—
“non-qualifying individual” has the meaning given by section 136(1);
occupation of any part of a dwelling is regarded as occupation of the dwelling.
A day in a chargeable period is relievable in relation to a single-dwelling interest if on that day—
a person carrying on a property trading business is entitled to the interest, and
the interest is held as stock of the business and for the sole purpose of resale in the course of the business.
A single-dwelling interest in a dwelling is taken not to be held for the sole purpose of resale in the course of a property trading business at any time when a non-qualifying individual is permitted to occupy the dwelling.
In this Part “property trading business” means a business that—
consists of or includes activities in the nature of a trade of buying and selling dwellings, and
is carried on on a commercial basis and with a view to profit.
Subsection (2) applies if on a day in a chargeable period (“the day of non-qualifying occupation”)—
a person carrying on a property trading business (“the property trader”) is entitled to a single-dwelling interest that is held as mentioned in section 141(1)(b), and
a non-qualifying individual is permitted to occupy the dwelling.
No subsequent day is relievable in the case of the single-dwelling interest by virtue of section 141(1) if—
the day falls within that chargeable period, or any of the subsequent 3 chargeable periods, and
the property trader or a relevant partner is entitled to the interest on that day.
If on the day of non-qualifying occupation mentioned in subsection (1) the property trader carries on the property trading business in partnership, “relevant partner” means any other person who is, at any time, a member of that partnership.
Subsection (5) applies if—
on a day in a chargeable period (“the day of non-qualifying occupation”) a person who is a non-qualifying individual in relation to a single-dwelling interest is occupying the dwelling in question, and
on an earlier day in that, or the preceding, chargeable period (“the earlier day”) the conditions in section 141(1)(a) and (b) are met in relation to the same single-dwelling interest.
The earlier day is not relievable by virtue of section 141(1) in the case of the single-dwelling interest if—
a person who is entitled to the interest on the earlier day is also entitled to it on the day of non-qualifying occupation, or
if the business mentioned in section 141(1) is carried on in partnership, a person who has at any time carried that business on in partnership is entitled to the interest on the day of non-qualifying occupation.
Subsection (5) does not apply in relation to the earlier day if a day that is relievable by virtue of section 133(1)(a) falls between the earlier day and the day of non-qualifying occupation.
For the purposes of this section and section 141—
“non-qualifying individual” has the meaning given by section 136(1);
occupation of any part of a dwelling is regarded as occupation of the dwelling.
A day in a chargeable period is relievable in relation to a single-dwelling interest if matters stand as follows on that day—
a financial institution carrying on a business that involves the lending of money is entitled to the interest,
the financial institution has acquired the interest in the course of that business and in connection with those lending activities, and
the interest is held with the intention that it will be sold in the course of that business without delay (except so far as delay is justified by commercial considerations or cannot be avoided).
A single-dwelling interest in a dwelling is taken not to be held with the intention mentioned in subsection (1)(c) at any time when a non-qualifying individual is permitted to occupy the dwelling.
In this Part (except where otherwise stated) “financial institution” has the meaning given by section 564B of ITA 2007; but for this purpose section 564B(1) is to be read as if paragraph (d) of that subsection were omitted.
Subsection (2) applies if on a day in a chargeable period—
a financial institution that carries on a business involving the lending of money is entitled to a single-dwelling interest that has been acquired by it as mentioned in section 143(1)(b), and
a non-qualifying individual is permitted to occupy the dwelling.
No subsequent day is relievable in the case of the single-dwelling interest by virtue of section 143(1) if—
the day falls within that chargeable period, or any of the subsequent 3 chargeable periods, and
there is continuity of ownership on that day.
There is continuity of ownership on a day on which—
the financial institution is entitled to the single-dwelling interest, or
if the financial institution carried on the business mentioned in subsection (1)(a) in partnership, another member of the partnership is entitled to the interest.
Subsection (5) applies if—
on a day in a chargeable period (“the day of non-qualifying occupation”) a person who is a non-qualifying individual in relation to a single-dwelling interest is occupying the dwelling in question, and
on an earlier day in that, or the preceding, chargeable period (“the earlier day”) the conditions in section 143(1)(a) to (c) are met in relation to the same single-dwelling interest.
The earlier day is not relievable by virtue of section 143(1) in the case of the single-dwelling interest if—
a person who is entitled to the interest on the earlier day is also entitled to it on the day of non-qualifying occupation, or
if the business mentioned in section 143(1) is carried on in partnership, a person who has at any time carried that business on in partnership is entitled to the interest on the day of non-qualifying ownership.
Subsection (5) does not apply in relation to the earlier day if a day that is relievable by virtue of section 133(1)(a) falls between the earlier day and the day of non-qualifying occupation.
For the purposes of this section and section 143—
“non-qualifying individual” has the meaning given by section 136(1);
occupation of any part of a dwelling is regarded as occupation of the dwelling.
A day in a chargeable period is a relievable if matters stand as follows on that day—
a person (“P”) is entitled to a single-dwelling interest,
P, or a relevant group member, carries on a qualifying trade or qualifying property rental business ,
the interest is held for the purpose of making the dwelling available to one or more qualifying employees or qualifying partners for use as living accommodation, and
the dwelling is, or is to be, made available as mentioned in paragraph (c) for purposes that are solely or mainly purposes of the qualifying trade or qualifying property rental business .
“Qualifying trade” means a trade that is carried on on a commercial basis and with a view to profit.
In this section references to making a dwelling available to a qualifying employee or qualifying partner include making it available to persons who are to share the accommodation with such an individual as their family.
Where P is a company, “a relevant group member” means a company which is a member of the same group as P for the purposes mentioned in paragraph 1(2) of Schedule 7 to FA 2003 (stamp duty land tax: group relief).
For the meaning of “qualifying property rental business” see section 133(3).
A day in a chargeable period is relievable in relation to a single dwelling interest held by a person (“P”) who is an authorised plan provider if—
P has, as plan provider, entered into a regulated home reversion plan relating to the single dwelling interest, and
the occupation condition is met on that day.
If no qualifying termination event has occurred, the “occupation condition” is that a person who was originally entitled to occupy the dwelling (or any part of it) under the regulated home reversion plan is still entitled to do so.
If a qualifying termination event has occurred, the “occupation condition” is that—
the single dwelling interest is being held with the intention that it will be sold without delay (except so far as delay is justified by commercial considerations or cannot be avoided), and
no non-qualifying individual is permitted to occupy the dwelling (or any part of it).
In this section—
In this section references to entering into a regulated home reversion plan “as plan provider” are to be interpreted as if the references were in the Regulated Activities Order (but see also subsection (6)).
For the purposes of this section—
an arrangement which P entered into before 6 April 2007 is treated for the purposes of this section as a regulated home reversion plan entered into by P as plan provider if that arrangement would have been so treated for the purposes of article 63B(1) of the Regulated Activities Order had P entered into that arrangement on the day mentioned in subsection (1);
an arrangement in relation to which P acquired rights or obligations before 6 April 2007 is treated for the purposes of this section as a regulated home reversion plan entered into by P as plan provider if that arrangement would have been so treated for the purposes of article 63B(1) of the Regulated Activities Order had P acquired those rights or obligations on the day mentioned in subsection (1).
Section 136 (meaning of “non-qualifying individual”) applies in relation to this section as in relation to sections 133 and 135.
In a case where the person carrying on the trade or property rental business mentioned in section 145(1)(b) carries it on in partnership with one or more other persons, “qualifying partner” means any individual who is a member of the partnership, except one who is entitled to a 10% or greater share—
in the income profits of the partnership, or
in any company that is entitled to the single-dwelling interest mentioned in section 145(1)(a), or
in the partnership's assets.
“Qualifying employee” means any individual employed for the purposes of the qualifying trade or qualifying property rental business , except one who—
is entitled to a 10% or greater share—
in the income profits of the trade or (as the case may be) property rental business , or
in any company that is entitled to the single-dwelling interest mentioned in section 145(1)(a), or
in that single-dwelling interest, or
provides excluded domestic services.
The reference in subsection (2)(b) to an individual who provides excluded domestic services is to an individual the duties of whose employment include the provision of services in connection with the (actual or intended) occupation, by a non-qualifying individual, of the dwelling mentioned in section 145(1)(c) (“the relevant dwelling”), or a linked dwelling.
In subsection (3) “non-qualifying individual” means an individual connected with a person who is entitled to the single-dwelling interest.
The following are “linked” dwellings for the purposes of subsection (3)—
if the conditions in section 116(2) are met in relation to the relevant dwelling and another dwelling, that other dwelling;
a dwelling that is linked to the relevant dwelling, as described in section 117(1).
In this section references to employment include the holding of an office.
For the purposes of subsections (1)(c) and (2)(a)(iii) persons who are entitled to a chargeable interest as beneficial joint tenants (or, in Scotland, as joint owners) are taken to be entitled to the chargeable interest as beneficial tenants in common (or, in Scotland, as owners in common) in equal shares.
This section applies for the purposes of section 146.
An individual (“P”) is taken to be entitled to a 10% or greater share in a company (“C”) if P possesses (directly or indirectly) or is entitled to acquire—
10% or more of the share capital of C,
10% or more of the issued share capital of C,
10% or more of the voting power in C,
so much of the issued share capital of C as would, on the assumption that the whole of the income of C were distributed among the participators, entitle P to receive 10% or more of the amount so distributed, or
such rights as would entitle P, in the event of the winding up of C or in any other circumstances, to receive 10% or more of the assets of C which would then be available for distribution among the participators.
Any rights that P or any other person has as a loan creditor are to be disregarded for the purposes of the assumption in subsection (2)(d).
For the purposes of subsection (2) a person is treated as entitled to acquire anything which the person—
is entitled to acquire at a future date, or
will at a future date be entitled to acquire.
If a person— those rights or powers are to be attributed to A.
possesses any rights or powers on behalf of another person (“A”), or
may be required to exercise any rights or powers on A's direction or behalf,
The following are also to be attributed to a person—
the rights and powers of any company of which the person has, or the person and associates of the person have, control;
the rights and powers of any two or more companies within paragraph (a);
the rights and powers of any associate of the person (or of any two or more associates of the person).
The rights and powers which are to be attributed under subsection (6)—
include those attributed to a company or associate under subsection (5), but
do not include those attributed to an associate under subsection (6).
A person who does not meet the conditions in subsection (2) is nevertheless treated as having a 10% or greater share in a company if the person exercises, is able to exercise or is entitled to acquire, direct or indirect control over the company's affairs.
In this section—
“tax arrangements” has the meaning given by section 207(1).
This paragraph applies where no part of the first straddling period falls within paragraph 1(2)(a). So far as concerns expenditure incurred before 1 January 2013, the maximum allowance under section 51A of CAA 2001 for the first straddling period is to be calculated as if the amendment made by section 7(1) had not been made.
Part 7 of ITEPA 2003 (employment income: income and exemptions relating to securities) is amended as follows.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Chapter 3 of Part 15 of ITA 2007 (deduction from certain payments of yearly interest) is amended as follows.
The amendments made by paragraphs 1 to 4 have effect— The amendments made by paragraphs 5 to 11 have effect in relation to any payment of interest which is made on or after the day on which this Act is passed.
ITA 2007 is amended as follows.
TIOPA 2010 is amended as follows. In section 85A(4) (schemes involving deemed foreign tax), omit paragraph (b) of the definition of “real foreign tax”. In Schedule 7 (miscellaneous relocations), omit paragraph 113. In Schedule 8 (minor and consequential amendments), omit paragraph 82.
In paragraph 7 of Schedule 6 to FA 2010 (definition of “charity”, “charitable company” and “charitable trust”)—
omit the “and” after paragraph (g), and
after paragraph (h) insert , and
TCGA 1992 is amended as follows. Omit section 9. In section 288 (interpretation)—
The amendments made by this Part of this Schedule have effect in relation to an individual’s foreign income and gains for the tax year 2013-14 or any subsequent tax year.
Section 1034 of CTA 2010 (purchase by unquoted trading company of own shares: requirements as to residence) is amended as follows. In subsections (1) and (2), omit “and ordinarily resident”. In subsection (3), omit “and ordinary residence” in both places. Omit subsection (4). The amendments made by this paragraph do not apply in relation to a purchase by an unquoted trading company of its own shares if the purchase takes place before 6 April 2013.
Chapter 1 of Part 8 of ITA 2007 (relief for interest payments) is amended as follows. In section 383(5), after paragraph (a) insert—. After section 384A insert—
In section 874 (duty to deduct from certain payments of yearly interest), after subsection (5) insert—
In section 2 (overview of Act)—
omit subsection (11), and
before subsection (11A) insert—
In section 27 of ITEPA 2003 (UK-based earnings for year when employee not UK resident), in subsection (1), for “in which” substitute “for which”.
In section 875 (interest paid by building societies), at the end insert “ unless it is treated as a payment of yearly interest by virtue of section 874(5A). ”
Omit the following provisions (which deal with manufactured payments and repos)—
sections 565 to 595,
section 596(1) to (4), and
section 606(8).
In section 465 of ITTOIA 2005 (gains from contracts for life insurance etc: liability of individuals), in subsection (1), for “in the tax year” substitute “for the tax year”.
In section 878 (interest paid by banks), after subsection (1) insert—
In section 647 (makers of manufactured payments), for subsection (6) substitute—
Chapter 4 of Part 2 of FA 2005 (trusts with vulnerable beneficiary) is amended as follows. In section 28 (vulnerable person’s liability: VQTI), for subsection (4) substitute— In section 30 (qualifying trusts gains: special capital gains tax treatment)— In section 31 (UK resident vulnerable persons: amount of relief), in subsection (1), for “during” substitute “for”. In section 32 (non-UK resident vulnerable persons: amount of relief), in subsection (1), for “during” substitute “for”. In section 41—
In section 658 (powers to modify: supplementary), for subsection (5) substitute—
ITA 2007 is amended as follows. In section 809B (claim for remittance basis to apply), in subsection (1)(a), for “in that year” substitute “for that year”. In section 809D (application of remittance basis without claim where unremitted foreign income and gains under £2,000), in subsection (1)(a), for “in that year” substitute “for that year”. In section 809E (application of remittance basis without claim: other cases), in subsection (1)(a), for “in that year” substitute “for that year”. In section 810 (limits on liability to income tax of non-UK residents: overview of Chapter), after subsection (3) insert— Omit sections 829 to 832.
In section 918(1) (manufactured dividends on UK shares: REITs), for paragraph (a) substitute—.
In section 919 (manufactured interest on UK securities)—
for subsection (1) substitute—,
in subsection (4), omit the words from “section 583” to “special cases)”, and
after subsection (5) insert—
Omit section 920 (foreign payers of manufactured interest: the reverse charge).
In section 921 (cases where interest on underlying securities paid gross), in subsection (3), for the words from “ “securities”” to the end substitute “ “manufactured interest” has the same meaning as in section 919. ”
Omit sections 922 to 925 (manufactured overseas dividends).
In section 925A(2) (creditor repos), for “to 925” substitute “ , 919 and 921 ”.
Omit section 925B (debtor repos).
In section 925C (actual payments ignored)—
in the heading, omit “or 925B”,
omit “or 925B(2)”, and
for “to 925” substitute “ , 919 and 921 ”.
In section 926 (interpretation of Chapter 9 of Part 15), omit subsections (1) and (1A).
In Schedule 1 (minor and consequential amendments), omit paragraph 335(1) to (4) and (6) to (8).
In Schedule 2 (transitionals and savings), omit paragraphs 108 to 111 (and the headings “Part 12”, “Manufactured payments and repos” and “Tax credits: stock lending arrangements and repos” immediately preceding paragraph 108).
In Schedule 4 (index of defined expressions), omit the entries for— “ buying back securities, in the context of a repo (in Part 11) ”, “ company UK REIT (in Chapter 2 of Part 11) ”, “ gross amount (in Chapter 2 of Part 11) ”, “ group (in Chapter 2 of Part 11) ”, “ group UK REIT (in Chapter 2 of Part 11) ”, “ manufactured dividend (in Chapter 2 of Part 11) ”, “ manufactured dividend (in Chapter 3 of Part 11) ”, “ manufactured interest (in Chapter 2 of Part 11) ”, “ manufactured overseas dividend (in Chapter 2 of Part 11) ”, “ overseas dividend (in Part 11) ”, “ overseas dividend (in Chapter 9 of Part 15) ”, “ overseas securities (in Part 11) ”, “ overseas tax (in Chapter 2 of Part 11) ”, “ overseas tax (in Chapter 9 of Part 15) ”, “ overseas tax credit (in Chapter 2 of Part 11) ”, “ prescribed (in Chapter 2 of Part 11) ”, “ principal company (in Chapter 2 of Part 11) ”, “ principal company (in Chapter 9 of Part 15) ”, “ property rental business (in Chapter 2 of Part 11) ”, “ property rental business (in Chapter 9 of Part 15) ”, “ related agreements (in Part 11) ”, “ relevant withholding tax (in Chapter 2 of Part 11) ”, “ repo (in Part 11) ”, “ the rules about manufactured payments (in Chapter 4 of Part 11) ”, “ stock lending arrangement (in Part 11) ”, “ trade carried on through a branch or agency (in Chapter 2 of Part 11) ”, “ transfer (in Chapter 2 of Part 11) ”, “ UK securities (in Part 11) ”, and “ UK shares (in Part 11) ”.
This section applies where on a day in a chargeable period—
a dwelling (“the farmhouse”) forms part of land occupied for the purposes of a qualifying trade of farming, and
a person carrying on the trade is entitled to, or connected with a person who is entitled to, a single-dwelling interest in the farmhouse.
That day is relievable in relation to the single-dwelling interest if on that day the farmhouse is occupied—
by a farm worker who occupies it for the purposes of the trade, or
by a former long-serving farm worker, or the surviving spouse or civil partner of a former farm worker.
A trade of farming is a “qualifying trade of farming” only if it is carried on—
on a commercial basis, and
with a view to profit.
In this section—
An individual is a “farm worker” in relation to the qualifying trade of farming mentioned in section 148(1) at any time when the individual has a substantial involvement in—
the day-to-day work of the trade, or
the direction and control of the conduct of the trade.
Where section 148 applies, an individual occupying the farmhouse on the day mentioned in section 148(1) is a “former long-serving farm worker” if the individual had, before that day, been a farm worker in relation to the qualifying trade of farming for—
a qualifying period of 3 or more years, or
qualifying periods together amounting to 3 or more years within a 5 year period.
In subsection (2) “qualifying period” means a period throughout which—
the individual occupied the farmhouse for the purposes of the trade,
the land of which the farmhouse forms part was occupied for the purposes of the trade,
the trade was carried on by—
a person who is entitled to the single-dwelling interest in the farmhouse on the day mentioned in section 148(1), or
a person connected with such a person, and
a person who is entitled to the single-dwelling interest in the farmhouse on the day mentioned in section 148(1) was entitled to that interest.
A person occupying part of a dwelling is regarded as occupying the dwelling for the purposes of this section and section 148.
A day in a chargeable period is relievable in relation to a single-dwelling interest if the dwelling in question is a flat in relation to which the conditions in subsection (2) are met.
The conditions are that on that day—
a company (“the management company”) holds the single-dwelling interest for the purpose of making the flat available as caretaker accommodation,
the flat is contained in premises which also contain two or more other flats,
the tenants of at least two of the other flats in the premises are members of the management company,
the management company owns the freehold of the premises, and
the management company is not carrying on a trade or property rental business.
For the purposes of subsection (2), the management company makes a flat available “as caretaker accommodation” if it makes it available to an individual for use as living accommodation in connection with the individual's employment as caretaker of the premises.
In this section “premises” means premises constituting the whole or part of a building.
A day in a chargeable period is relievable in relation to a single-dwelling interest if on that day—
a profit-making registered provider of social housing (P) is entitled to the interest, and
P's acquisition of the interest (or of any part of the interest) was funded with the assistance of public subsidy.
A day in a chargeable period is relievable in relation to a single-dwelling interest if on that day—
a qualifying housing provider ... is entitled to the interest, and
the condition in subsection (3) is met.
The condition mentioned in subsection (2) is that—
the qualifying housing provider is controlled by its tenants,
the person from whom the qualifying housing provider acquired the interest (or any part of the interest) is a qualifying body, or
the qualifying housing provider's acquisition of the interest (or of any part of the interest) was funded with the assistance of a public subsidy.
In this section—
subsection (2) of section 71 of FA 2003 applies in relation to a reference to a qualifying housing provider controlled by its tenants as it applies to a reference in that section to a non-profit registered provider of social housing controlled by its tenants;
“qualifying body” means—
anything described as a qualifying body in subsection (3) of that section,
the Scottish Ministers,
a council constituted under section 2 of the Local Government etc. (Scotland) Act 1994, or
Scottish Homes;
“public subsidy” means—
anything that is a public subsidy for the purposes of section 71 of FA 2003, and for the purposes of this section the reference in subsection (5)(a) of that section to “the purchaser” is to be treated as a reference to P or the qualifying housing provider (as the case may be);
any grant or other financial assistance under section 18 of the Housing Act 1996 (c. 52) (social housing grants);
any grant or other financial assistance under section 2 of the Housing (Scotland) Act 1988 (c. 43) (general functions of the Scottish Ministers);
“qualifying housing provider” means—
a relevant housing provider (within the meaning of section 71 of FA 2003),
a body registered as a social landlord in a register maintained under section 1(1) of the Housing Act 1996 (Welsh registered social landlords), or
a body registered under section 20(1) of the Housing (Scotland) Act 2010 (asp 17) (Scottish registered social landlords).
A day in a chargeable period is relievable in relation to a single-dwelling interest if on that day a qualifying housing co-operative (as defined by section 150A) is entitled to the interest.
A company is a “qualifying housing co-operative” for the purposes of section 150(3A) on any day if on that day—
it is a housing association within the meaning of—
the Housing Associations Act 1985, or
Part 2 of the Housing (Northern Ireland) Order 1992 (S.I. 1992/1725 (N.I. 15)),
it is a registered society within the meaning of—
the Co-operative and Community Benefit Societies Act 2014, or
the Co-operative and Community Benefit Societies Act (Northern Ireland) 1969, and
the rules of the association comply with subsection (2).
The rules of the association—
must restrict membership to persons who are tenants, or prospective tenants, of the association,
must preclude the granting or assignment of tenancies to persons other than members,
must prevent members from transferring any of their shares,
must prevent members from receiving any more than the nominal value of their shares on a return of share capital, and
must confer on members equal voting rights.
A charitable company that is entitled to a single-dwelling interest is regarded as not meeting the ownership condition with respect to the interest on any day on which the interest is held by the company for qualifying charitable purposes, other than an excluded day.
The interest is “held for qualifying charitable purposes” if it is held—
for use in furtherance of the charitable purposes of the charitable company or of another charity, or
as an investment from which the profits are (or are to be) applied to the charitable purposes of the charitable company.
A day is an “excluded day” if the following conditions are met— but see the exception in subsection (5).
a person (“the donor”) has on or before that day made, or agreed to make, a gift to the charitable company or to a charity that is connected with it,
there exist on that day arrangements under which or as a result of which a linked individual is permitted, or is to be or may in the future be permitted, to occupy the dwelling, and
it is reasonable to assume from either or both of— that the gift would not have been made and the arrangements would not have been entered into independently of one another;
the likely effects of the gift and the arrangements, or
the circumstances in which the gift was made and the circumstances in which the arrangements were entered into,
In subsection (3)(b) “linked individual” means an individual who—
is the donor, or
was, when the arrangements were entered into, an associate of the donor.
A day is not an “excluded day” if the first, second or third condition is met on that day. The first condition is that the activities undertaken for carrying out the primary purposes of the charitable company include, or normally include, opening the dwelling to the public. The second condition is that the dwelling is being exploited through commercial activities that involve, or normally involve, opening the dwelling to the public. The third condition is that steps are being taken— to secure that the first or second condition will be met without undue delay, or to secure that the single-dwelling interest will be sold without undue delay.
In subsection (5)—
“opening the dwelling to the public” means offering the public the opportunity to make use of, stay in or otherwise enjoy, on at least 28 days in any year, areas that constitute a significant part of the interior of the dwelling or of the dwelling's garden or grounds;
“without undue delay” means without delay, except so far as delay is justified by commercial considerations or for the sake of a primary purpose of the charitable company.
For the purposes of subsection (6)(a), the size (relative to the size of the whole dwelling or of the whole garden or grounds), nature, and function of the areas concerned are to be taken into account in determining whether they form a significant part of the interior of the dwelling or (as the case may be) of the garden or grounds.
For the purposes of subsection (3)(a)—
“connected” means connected in a matter relating to the structure, administration or control of the charitable company, and
section 172 does not apply.
In section 151 “associate”, in relation to the donor, means any of the following—
an individual (“a connected person”) who is connected with the donor,
an individual who is the settlor in relation to a settlement of which a trustee is (in the capacity of trustee) connected with the donor,
the spouse or civil partner of a connected person or of a relevant settlor,
a relative of a connected person or of a relevant settlor, or the spouse or civil partner of a relative of a connected person or of a relevant settlor,
a relative of the spouse or civil partner of a connected person or of a relevant settlor, or
the spouse or civil partner of a person falling within paragraph (e).
In subsection (1)—
In subsection (1)(b) “trustee” is to be read in accordance with section 1123(3) of CTA 2010 (“connected persons”: supplementary).
For the purposes of section 151 occupation of any part of a dwelling is regarded as occupation of the dwelling.
For the purposes of section 151(3)—
the making of a gift is disregarded if it is made before the day on which this Act is passed, and
an agreement to make a gift is disregarded if the agreement is made before that day.
Arrangements entered into before the day on which this Act is passed are disregarded for the purposes of section 151(3) unless a material alteration has been made to them on or after that date. “Material alteration” means an alteration affecting anything in the arrangements that relates to the individual's having (at any time), or potentially having, permission to occupy the dwelling.
References in section 151 and this section to a gift include the disposal of an asset for consideration of an amount or value which is less than the market value of the asset.
In section 151 and this section “arrangements” includes any scheme, arrangement or understanding of any kind, whether or not legally enforceable, involving a single transaction or two or more transactions.
A public body is not regarded as a company for the purposes of this Part.
In this section—
“public body” means any body corporate that is a public body for the purposes of section 66 of FA 2003, and
references to a public body accordingly include a company such as is mentioned in subsection (5) of that section (companies wholly owned by the listed bodies).
The power of the Treasury to prescribe persons by an order under section 66(4) of FA 2003 may be exercised so as to make different provision for purposes relating to annual tax on enveloped dwellings and stamp duty land tax.
In paragraph (b) of subsection (2) “company” means a company as defined by section 1 of the Companies Act 2006 (and subsection (1) is to be ignored in interpreting that paragraph).
A body listed in subsection (2) is not regarded as a company for the purposes of this Part.
The bodies are— the Historic Buildings and Monuments Commission for England; the Trustees of the British Museum; the Trustees of the National Heritage Memorial Fund; the Trustees of the Natural History Museum.
Subsection (2) applies to a single-dwelling interest if—
the whole or part of the dwelling has been designated under section 31 of IHTA 1984 (buildings of outstanding historic or architectural interest etc),
an undertaking has been made with respect to the dwelling under section 30 of that Act (conditionally exempt transfers), and
a transfer of value is exempt from inheritance tax by virtue of that designation and that undertaking.
The taxable value of the single-dwelling interest on any day is taken to be zero if no chargeable event has occurred with respect to the dwelling in the time between the transfer of value and the beginning of that day.
Subsection (4) applies to a single-dwelling interest if—
the whole or part of the dwelling has been designated under section 31 of IHTA 1984,
an undertaking has been made with respect to the dwelling under section 78 of that Act (settled property: conditionally exempt occasions), and
a transfer of property or other event is a conditionally exempt occasion by virtue of that designation and that undertaking.
The taxable value of the single-dwelling interest on any day is taken to be zero if no chargeable event has occurred with respect to the dwelling in the time between the conditionally exempt occasion and the beginning of that day.
In this section—
The Treasury may by regulations—
amend this Part for the purpose of providing further relief, or further exemptions, from tax (whether by modifying an existing relief or exemption or otherwise);
amend or repeal any of sections 132 to 155 for purposes not falling within paragraph (a);
make any amendment of any other provision of this Part that may be necessary in consequence of provision under paragraph (b).
In subsection (1)—
the reference to providing further relief from tax includes the provision of relief for additional persons or categories of person or in additional cases or circumstances;
the reference to providing further exemptions from tax includes the provision of exemptions for additional persons or categories of person or in additional cases or circumstances.
This section applies where—
section 71A of FA 2003 (land sold to financial institution and leased to person) ... applies in relation to arrangements entered into between a financial institution and another person (“the lessee”), and
the land in which the institution purchases a major interest under the first transaction is in England ... or Northern Ireland and consists of or includes one or more dwellings (or parts of a dwelling).
This Part has effect in relation to times when the arrangements are in operation as if—
the interest held by the financial institution as mentioned in subsection (3)(b) were held by the lessee (and not by the financial institution), and
the lease or sub-lease granted under the second transaction had not been granted.
The reference in subsection (2) to times when the arrangements are in operation is to times when—
the lessee holds the leasehold interest granted to it under the second transaction, and
the interest purchased under the first transaction (or that interest except so far as transferred by a further transaction) is held by a financial institution.
A company or individual treated under subsection (2)(a) as holding an interest at a particular time is treated as holding it as a member of a partnership if at the time in question the company or individual holds the leasehold interest as a member of the partnership (and this Part has effect accordingly in relation to the other members of the partnership).
In relation to times when the arrangements operate for the benefit of a collective investment scheme, this Part has effect as if—
the interest held by the financial institution as mentioned in subsection (6)(b) were held by the lessee for the purposes of a collective investment scheme (and were not held by the financial institution), and
the lease or sub-lease granted under the second transaction had not been granted.
The reference in subsection (5) to times when the arrangements operate for the benefit of a collective investment scheme is to times when—
the lessee holds the leasehold interest for the purposes of a collective investment scheme, and
the interest purchased under the first transaction (or that interest except so far as transferred by a further transaction) is held by a financial institution.
In this section—
“the games period” means the period—
The amendments made by paragraphs 1 and 2 above have effect for the tax year 2013-14 and subsequent tax years.
After section 370 of ITTOIA 2005 insert—
The amendments made by paragraphs 1 to 7 have effect in relation to transactions with an effective date on or after the day on which this Act is passed.
In Schedule 17A (further provisions about leases), paragraph 3 (leases that continue after a fixed term) is amended as follows. In sub-paragraph (3)— But no tax or additional tax is payable in respect of a transaction as a result of the continuation of a lease for a period (or further period) of one year under sub-paragraph (2) if, during that one year period, the tenant under the lease is granted a new lease of the same or substantially the same premises in circumstances where paragraph 9A applies. Sub-paragraph (2) is subject to paragraph 3A. In sub-paragraph (4), for the words from “the day” to the end substitute “the last day of the one year period for which the lease is continued or (as the case may be) further continued.” Where— the lease is to be treated as continuing under sub-paragraph (2) only until that time; and the references in sub-paragraphs (3) and (4) to that one year period are accordingly to be read as references to so much of that year as ends with that time.
The amendments made by paragraph 2(2), (3), (5) and (6) have effect in relation to any one year period for which a lease is continued, or further continued, which begins on or after the commencement day (including any period which would be one year but for paragraph 3(6) of Schedule 17A to FA 2003). The amendments made by paragraphs 2(4), 3 and 5 have effect if the one year period mentioned in paragraph 3A(1)(b) of Schedule 17A to FA 2003 begins on or after the commencement day. The amendments made by paragraph 4 have effect in relation to amounts payable in consequence of any period for which a lease is continued, or further continued, which begins on or after the commencement day. The amendments made by paragraph 6 have effect if the effective date of the actual lease or, as the case may be, second lease falls on or after the commencement day. The amendments made by paragraph 7 have effect in relation to any increase in rent that takes effect on or after the commencement day. “The commencement day” means the day on which this Act is passed.
If a designated HMRC officer considers— the officer must give the taxpayer a written notice to that effect. The notice must— The notice may set out steps that the taxpayer may take to avoid the proposed counteraction.
The sufficient ties test is met for year X if— “UK ties” is defined in Part 2 of this Schedule. Whether P has “sufficient” UK ties for year X will depend on— The Tables in paragraphs 18 and 19 show how many ties are sufficient in each case.
If P is present in the UK at the end of a day, that day counts as a day spent by P in the UK. But it does not do so in the following two cases. The first case is where— The second case is where— Examples of circumstances that may be “exceptional” are— For a tax year—
P is considered to be “working” (or doing “work”) at any time when P is doing something— In deciding whether something is being done in the performance of duties of an employment, regard must be had to whether, if value were received by P for doing the thing, it would fall within the definition of employment income in section 7 of ITEPA 2003. In deciding whether something is being done in the course of a trade, regard must be had to whether, if expenses were incurred by P in doing the thing, the expenses could be deducted in calculating the profits of the trade for income tax purposes. Time spent travelling counts as time spent working— Time spent undertaking training counts as time spent working if— Sub-paragraphs (4) and (5) have effect without prejudice to the generality of sub-paragraphs (2) and (3). Assume for the purposes of sub-paragraphs (2) to (5) that P is someone who is chargeable to income tax under ITEPA 2003 or ITTOIA 2005. A voluntary post for which P has no contract of service does not count as an employment for the purposes of this Schedule.
There is a “significant break from UK work” if at least 31 days go by and not one of those days is— There is a “significant break from overseas work” if at least 31 days go by and not one of those days is—
P has a family tie for year X if— A relevant relationship exists at any time between P and another person if at the time— P does not have a family tie for year X by virtue of sub-paragraph (2)(c) if P sees the child in the UK on fewer than 61 days (in total) in— A day counts as a day on which P sees the child if P sees the child in person for all or part of the day. “Separated” means separated—
In section 614 of ICTA (exemptions and reliefs in respect of income from investments etc of certain pension schemes)—
in subsection (4), for “not domiciled, ordinarily resident or resident” substitute “not domiciled and not resident”, and
in subsection (5), for “not domiciled, ordinarily resident or resident” substitute “not domiciled and not resident”.
Section 157 of IHTA 1984 (non-residents’ bank accounts) is amended as follows. For subsection (2) substitute— In subsection (3), for “, resident or ordinarily resident” substitute “or resident”. In subsection (4)— The amendments made by this paragraph do not apply if the person dies before 6 April 2013.
F(No.2)A 2005 is amended as follows.
In section 363A of TIOPA 2010 (residence of offshore funds which are undertakings for collective investment in transferable securities), in subsection (3), for “neither resident nor ordinarily resident” substitute “not resident”.
Sub-paragraph (2) applies to a claim which relates to the tax year 2013-14 or a subsequent tax year by virtue of paragraph 2 of Schedule 1B to TMA 1970 where the earlier year is a tax year before the tax year 2013-14. The amount of the claim is to be determined as if the amendments made by paragraphs 1 and 2 above also have effect for tax years before the tax year 2013-14. For this purpose, section 24A(6) of ITA 2007 (as inserted by paragraph 1 above) is treated as having effect for tax years before the tax year 2013-14 as if—
In section 380 of that Act (funding bonds), in subsection (3), at the end insert “ (but does not include any instrument providing for payment in the form of goods or services or a voucher) ”.
After that paragraph insert—
If a notice is given to the taxpayer under paragraph 3, the taxpayer has 45 days beginning with the day on which the notice is given to send written representations in response to the notice to the designated HMRC officer. The designated officer may, on a written request made by the taxpayer, extend the period during which representations may be made.
If P is not present in the UK at the end of a day, that day does not count as a day spent by P in the UK. This is subject to the deeming rule. The deeming rule applies if— The deeming rule is that, once the number of qualifying days in the tax year reaches 30 (counting forward from the start of the tax year), each subsequent qualifying day in the tax year is to be treated as a day spent by P in the UK. The deeming rule does not apply for the purposes of sub-paragraph (3)(a) (so, in deciding for those purposes whether P has a 90-day tie, qualifying days in excess of 30 are not to be treated as days spent by P in the UK).
This paragraph applies in deciding for the purposes (only) of paragraph 32(1)(b) whether a person with whom P has a relevant relationship (a “family member”) is someone who is resident in the UK for year X. A family tie based on the fact that a family member has, by the same token, a relevant relationship with P is to be disregarded in deciding whether that family member is someone who is resident in the UK for year X. A family member falling within sub-paragraph (4) is to be treated as being not resident in the UK for year X if the number of days that he or she spends in the UK in the part of year X outside term-time is less than 21. A family member falls within this sub-paragraph if he or she— In sub-paragraph (4)— For the purposes of this paragraph, half-term breaks and other breaks when teaching is not provided during a term are considered to form part of “term-time”.
In section 7 (charge to income tax on lump sum), in subsection (3), omit “, ordinarily resident”. The amendment made by this paragraph has effect in relation to the tax year 2013-14 and any subsequent tax year.
In section 24A(6)(d) of ITA 2007 (as inserted by paragraph 1 above) the reference to relief does not include relief in respect of a loss made in the tax year 2012-13.
In section 939 of ITA 2007 (duty to retain bonds where issue treated as payment of interest), in subsection (6), at the end insert “ (but does not include any instrument providing for payment in the form of goods or services or a voucher) ”.
In section 87 (interest on unpaid tax), in subsection (3)—
after paragraph (aa) insert— and
in paragraph (ab) omit “3(3) or” and “leases that continue after a fixed term and”.
In section 18 (section 17(3): specific powers), in subsection (1)(f) and (g), omit “ordinarily”.
In section 975 of that Act (statements about deduction of income tax), in subsection (1)—
after “if” insert— , and
at the end insert, and .
paragraph 3(4) of Schedule 17A (leases that continue after a fixed term),
After section 975 of that Act insert—
In section 413 of CTA 2009 (issue of funding bonds), in subsection (3), at the end insert “ (but does not include any instrument providing for payment in the form of goods or services or a voucher) ”.
The reference in subsection (1) to a major interest in land is to be read in accordance with section 117 of FA 2003.
Where the lessee is an individual, references in subsections (2), (3), (5) and (6) to the lessee are to be read, in relation to times after the death of the lessee, as references to the lessee's personal representatives.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
in subsection (1) the words “or section 72 of that Act (land in Scotland sold to financial institution and leased to person)” were omitted, and
in subsection (7) the words, “or (as the case requires) section 72” were omitted (in each place).
This section applies where Conditions A and B are met.
Condition A is that arrangements are entered into between a person (“the lessee”) and a financial institution under which the institution—
purchases a major interest in land (“the first transaction”),
grants to the lessee out of that interest a lease (if the interest acquired is the interest of the owner) or a sub-lease (if the interest acquired is the tenant's right over or interest in a property subject to a lease) (“the second transaction”), and
enters into an agreement under which the lessee has a right to require the institution to transfer the major interest purchased by the institution under the first transaction.
Condition B is that the land in which the institution purchases a major interest under the first transaction is in Scotland and consists of or includes one or more dwellings or parts of a dwelling.
This Part has effect in relation to times when the arrangements are in operation (see subsection (5)) as if—
the interest held by the financial institution as mentioned in subsection (5)(b) were held by the lessee (and not by the financial institution), and
the lease or sub-lease granted under the second transaction had not been granted.
The reference in subsection (4) to times when the arrangements are in operation is to times when—
the lessee holds the interest granted to it under the second transaction, and
the interest purchased under the first transaction is held by a financial institution.
A company or individual treated under subsection (4)(a) as holding an interest at a particular time is treated as holding it as a member of a partnership if at the time in question the company or individual holds the interest granted to it under the second transaction as a member of the partnership (and this Part has effect accordingly in relation to the other members of the partnership).
In relation to times when the arrangements operate for the benefit of a collective investment scheme (see subsection (8)), this Part has effect as if—
the interest held by the financial institution as mentioned in subsection (8)(b) were held by the lessee for the purposes of a collective investment scheme (and were not held by the financial institution), and
the lease or sub-lease granted under the second transaction had not been granted.
The reference in subsection (7) to times when the arrangements operate for the benefit of a collective investment scheme is to times when—
the lessee holds the interest granted to it under the second transaction for the purposes of a collective investment scheme, and
the interest purchased under the first transaction is held by a financial institution.
In this section “financial institution” has the same meaning as in section 71A of FA 2003 (see section 73BA of that Act).
References in this section to a “major interest” in land are to—
ownership of land, or
the tenant's right over or interest in land subject to a lease.
Where the lessee is an individual, references in subsections (4), (5), (7) and (8) to the lessee are to be read, in relation to times after the death of the lessee, as references to the lessee's personal representatives.
This section applies where—
paragraph 2 of Schedule 10 to the Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017 (anaw 1) (land in Wales sold to financial institution and leased to person) applies in relation to arrangements entered into between a financial institution and another person (“the lessee”), and
the land in which the institution purchases a major interest under the first transaction is in Wales and consists of or includes one or more dwellings (or parts of a dwelling).
This Part has effect in relation to times when the arrangements are in operation as if—
the interest held by the financial institution as mentioned in subsection (3)(b) were held by the lessee (and not by the financial institution), and
the lease or sub-lease granted under the second transaction had not been granted.
The reference in subsection (2) to times when the arrangements are in operation is to times when—
the lessee holds the leasehold interest granted to it under the second transaction, and
the interest purchased under the first transaction (or that interest except so far as transferred by a further transaction) is held by a financial institution.
A company or individual treated under subsection (2)(a) as holding an interest at a particular time is treated as holding it as a member of a partnership if at the time in question the company or individual holds the leasehold interest as a member of the partnership (and this Part has effect accordingly in relation to the other members of the partnership).
In relation to times when the arrangements operate for the benefit of a collective investment scheme, this Part has effect as if—
the interest held by the financial institution as mentioned in subsection (6)(b) were held by the lessee for the purposes of a collective investment scheme (and were not held by the financial institution), and
the lease or sub-lease granted under the second transaction had not been granted.
The reference in subsection (5) to times when the arrangements operate for the benefit of a collective investment scheme is to times when—
the lessee holds the leasehold interest for the purposes of a collective investment scheme, and
the interest purchased under the first transaction (or that interest except so far as transferred by a further transaction) is held by a financial institution.
In this section—
The reference in subsection (1) to a major interest in land is to be read in accordance with section 68 of the Land Transaction Tax and Anti-avoidance of Devolved Taxes (Wales) Act 2017.
Where the lessee is an individual, references in subsections (2), (3), (5) and (6) to the lessee are to be read, in relation to times after the death of the lessee, as references to the lessee’s personal representatives.
The Commissioners for Her Majesty's Revenue and Customs are responsible for the collection and management of annual tax on enveloped dwellings.
Where tax is charged on a person for a chargeable period with respect to a single-dwelling interest the person must deliver a return for the period with respect to the interest.
A return under subsection (1) must be delivered by the end of the period of 30 days beginning with first day in the period on which the person is within the charge with respect to the interest.
If the first day in the chargeable period on which the person is within the charge with respect to the interest (“day 1”) is a valuation date only because of section 124 (new dwellings) or section 125 (dwellings produced from other dwellings)—
subsection (2) does not apply, and
the return must be delivered by the end of the period of 90 days beginning with day 1.
A return under this section must be delivered to an officer of Revenue and Customs, and is called an “annual tax on enveloped dwellings return”.
Where a person— subsection (2) has effect as if it required the return mentioned in paragraph (a) to be delivered by the later date.
would (apart from this subsection) be required in accordance with subsection (2) to deliver a return for a chargeable period (“the later period”) by 30 April in that period, and
is also required in accordance with subsection (3) to deliver a return for the previous chargeable period by a date (“the later date”) which is later than 30 April in the later period,
A person on whom tax is charged for a chargeable period with respect to a single-dwelling interest must deliver a further return for the period with respect to the interest if the first or second condition is met.
The return must be delivered by the end of the period of 30 days beginning with the first day of the period following the period for which the tax is charged (but see subsection (3)).
If the return is required because the second condition is met and the adjusted chargeable amount is affected by an event that has occurred after the end of the chargeable period mentioned in subsection (1), the return must be delivered by the end of the period of 30 days beginning with the day on which that event occurred.
The first condition is that—
the person has not made a claim under section 100 (interim relief) with respect to the interest for the chargeable period, and
the adjusted chargeable amount is greater than the amount charged under section 99 with respect to the single-dwelling interest for the period.
The second condition is that—
the person has made one or more claims under section 100 with respect to the interest for the chargeable period, and
the sum of amounts A and B, as calculated under that section, in connection with the last of those claims is less than the adjusted chargeable amount.
A return under this section must be delivered to an officer of Revenue and Customs, and is called a “return of the adjusted chargeable amount”.
“Relief declaration return” means an annual tax on enveloped dwellings return which—
states that it is a relief declaration return,
relates to one (and only one) of the types of relief listed in the table in subsection (9), and
specifies which type of relief it relates to.
A relief declaration return may be made in respect of one or more single-dwelling interests.
A relief declaration return delivered to an officer of Revenue and Customs on a particular day (“the day of the claim”) is treated as made in respect of any single-dwelling interest in relation to which the conditions in subsection (4) are met (but need not contain information which identifies the particular single-dwelling interest or interests concerned).
The conditions are that—
the person making the return is within the charge with respect to the single-dwelling interest on the day of the claim;
the day of the claim is relievable in relation to the single-dwelling interest by virtue of a provision which relates to the type of relief specified in the return (see subsection (9));
none of the days in the pre-claim period is a taxable day.
The statement under subsection (1)(a) in a relief declaration return is treated as a claim for interim relief (see section 100) with respect to the single-dwelling interest (or interests) in respect of which the return is made.
Subsection (7) applies where—
a person has delivered to an officer of Revenue and Customs on any day a relief declaration return for a chargeable period with respect to one or more single-dwelling interests (“the existing return”), and
there is a subsequent day (“day S”) in the same chargeable period on which the relevant conditions are met in relation to another single-dwelling interest.
The existing return is treated as also made with respect to that other single-dwelling interest.
For the purposes of subsection (6)(b), the “relevant conditions” are the same as the conditions in subsection (4), except that for this purpose references in subsection (4) to the day of the claim are to be read as references to day S.
This table sets out the numbered types of relief to which the provisions specified in the left hand column relate— Provision Type of relief to which it relates Section 133 or 134 (property rental business) 1 Section 137 (dwellings opened to the public) 2 Section 138 or 139 (property developers) 3 Section 141 (property traders) 4 Section 143 (financial institutions acquiring dwellings) 5 144A (regulated home reversion plans) 5A Section 145 or 147A (occupation by certain employees etc) 6 Section 148 (farmhouses) 7 Section 150 (providers of social housing) 8
Where a person— the failure may be taken, for the purposes of Schedule 55 to FA 2009, to be a failure to make a single annual tax on enveloped dwellings return.
has failed to make annual tax on enveloped dwellings returns in respect of two or more single-dwelling interests, and
could have discharged the duties in question by making a single relief declaration return in respect of all the interests,
In this section—
A return must include a self assessment.
In subsection (1) “return” means—
an annual tax on enveloped dwellings return, or
a return of the adjusted chargeable amount.
In the case of an annual tax on enveloped dwellings return, “self assessment” means an assessment of—
the amount of tax to which the person is chargeable under section 99 for the period in respect of the interest, and
if the return includes a claim under section 100 (interim relief), the tax payable after the relief.
The reference in subsection (2)(a) to an annual tax on enveloped dwellings return does not include a relief declaration return.
In the case of a return of the adjusted chargeable amount, “self assessment” means an assessment of—
the adjusted chargeable amount, and
the additional tax payable in accordance with section 163(2).
A self assessment must include a statement of the amount taken to be the market value of the interest on each valuation date (earlier than the date on which the return is delivered) that is relevant for the purposes of the assessment.
Schedule 33 contains provision about returns, enquiries and related matters.
The Treasury may by regulations—
make any amendments of Schedule 33 that they may at any time think appropriate;
make any amendment of any other provision of this Part that may be necessary in consequence of provision under paragraph (a).
Tax charged on a person under section 99 for a chargeable period with respect to a single-dwelling interest must be paid not later than the filing date for the annual tax on enveloped dwellings return required to be made for the period with respect to the interest.
So far as a chargeable person's adjusted chargeable amount for a chargeable period with respect to a single-dwelling interest exceeds the amount payable under subsection (1) (as modified, where applicable, by section 100(3)), the amount of the difference must be paid not later than the filing date for the return of the adjusted chargeable amount under section 160.
Tax payable as a result of the amendment of a return must be paid—
immediately, or
if the amendment is made on or before the filing date for the return, not later than that date.
In subsection (3) “return” means—
an annual tax on enveloped dwellings return, or
a return of the adjusted chargeable amount.
Tax payable in accordance with a determination or assessment by an officer of Revenue and Customs must be paid within the period of 30 days beginning with the day on which the determination or assessment is issued.
In Schedule 34—
Part 1 contains provision about information and inspection powers, and
Part 2 contains provision about penalties.
Schedule 12 to FA 2003 (stamp duty land tax: collection and recovery of tax) has effect in relation to the collection and recovery of tax under this Part as it has effect in relation to stamp duty land tax.
The reference in subsection (1) to tax under this Part includes any unpaid penalty or interest under this Part.
In this Part “company” means a body corporate but does not include—
a corporation sole, or
any partnership (see section 167(1)).
Everything to be done by a company under this Part must be done by the company acting through—
the proper officer of the company, or
another person who has the express, implied or apparent authority of the company to act on its behalf for the purpose.
Service of a document on a company under this Part may be effected by serving the document on the proper officer.
Tax due from any company that is incorporated under the law of a country or territory outside the United Kingdom may be recovered from the proper officer of the company (as well as by any means available in the absence of this subsection).
The proper officer—
may retain, out of any money that may come into the officer's hands on the company's behalf, enough money to pay that tax, and
is entitled to be fully reimbursed by the company (whether by that method or another) for amounts recovered from the officer under subsection (4).
For the purposes of this section the proper officer of a company is—
the secretary, or a person acting as secretary, of the company, or
if the company does not have a proper officer within paragraph (a), the treasurer, or a person acting as treasurer, of the company.
If a liquidator has been appointed for the company—
subsections (2)(b) and (6) do not apply, and
the liquidator is the proper officer of the company.
If an administrator has been appointed for the company—
subsection (6) does not apply, and
the administrator is the proper officer of the company.
If two or more persons are appointed to act jointly or concurrently as the administrator of the company, the proper officer of the company is—
whichever of those persons is specified in a notice given by the administrators to an officer of Revenue and Customs for the purposes of this section, or
if no notice is given under paragraph (a), whichever of those persons is designated by an officer of Revenue and Customs as the proper officer for those purposes.
See also section 153 (public bodies) and section 154 (bodies established for national purposes).
In this Part “partnership” means—
a partnership within the Partnerships Act 1890,
a limited partnership registered under the Limited Partnerships Act 1907,
a limited liability partnership formed under the Limited Liability Partnerships Act 2000 or the Limited Liability Partnerships Act (Northern Ireland) 2002, or
a firm or entity of a similar character to any of those mentioned in paragraphs (a) to (c) formed under the law of a country or territory outside the United Kingdom.
This Part has effect as follows in relation to a partnership (for instance, a limited liability partnership formed as mentioned in subsection (1)(c)) that is itself capable of being entitled to, or of acquiring or disposing of, a chargeable interest—
transactions entered into on behalf of the partnership are treated as entered into by or on behalf of the partners;
where the partnership is entitled to a single-dwelling interest, this Part has effect as if the partners were jointly entitled to the interest (and the partnership had no entitlement to it).
For the purposes of this Part a partnership is treated as the same partnership despite a change in membership if any person who was a member before the change remains a member after the change.
For the purposes of this Part—
a collective investment scheme is not regarded as a partnership, and
accordingly, a member of a partnership by or on whose behalf a single-dwelling interest is held for the purposes of a collective investment scheme is not regarded as entitled to the interest as a member of the partnership.
Anything required or authorised by this Part to be done by or in relation to the responsible partners for a partnership may instead be done by or in relation to any representative partner or partners.
A representative partner means a partner nominated by a majority of the partners to act as the representative of the partnership for the purposes of this Part of this Act.
Any such nomination, or the revocation of such a nomination, has effect only after notice of the nomination, or revocation, has been given to an officer of Revenue and Customs.
Schedule 35 contains—
miscellaneous amendments, and
provision about the chargeable period beginning on 1 April 2013.
Orders and regulations under this Part are to be made by statutory instrument.
A statutory instrument containing an order or regulations made under this Part is subject to annulment in pursuance of a resolution of the House of Commons.
Subsection (2) does not apply to—
an instrument containing only an order under section 101(5), or
an instrument to which subsection (4) applies.
A statutory instrument containing (whether alone or with other provision) provision made under section 156(1) or 162(2) may not be made unless a draft of the instrument has been laid before and approved by a resolution of the House of Commons.
An order or regulations under this Part—
may make different provision for different purposes,
may include consequential or transitional provisions or savings.
Any day on which the conditions in section 94(2) are met with respect to a single-dwelling interest is a “chargeable day” for that interest.
Where a day is a chargeable day as a result of subsection (1), the chargeable person is “within the charge” with respect to a single-dwelling interest on that day.
In determining for the purposes of any provision of this Part whether or not a state of affairs obtains on a particular day, it is to be assumed that the state of affairs obtaining at the end of the day persisted throughout the day.
Section 1122 of the Corporation Tax Act 2010 (connected persons) has effect for the purposes of this Part (except where otherwise stated).
For the purposes of this Part a person is taken to be connected with a collective investment scheme if the person is a participant in the scheme who—
is entitled to a share of at least 50% either of all the profits or income arising from the scheme or of any profits or income arising from the scheme that may be distributed to participants, or
would in the event of the winding up of the scheme be entitled to 50% or more of the assets of the scheme that would then be available for distribution among the participants.
The reference in subsection (2) to a collective investment scheme does not include a unit trust scheme; but see section 1123(2) of CTA 2010 (provision about the application of rules about connected persons to unit trust schemes).
The reference in subsection (2)(a) to profits or income arising from the scheme is to profits or income arising from the acquisition, holding, management or disposal of the property subject to the scheme.
For the purposes of subsection (2) a person is taken to have any rights and powers that the person—
is entitled to acquire at a future date, or
will at a future date be entitled to acquire.
For the purposes of subsection (2) the rights and powers of any associate of a person (or of any two or more associates of a person) are to be attributed to the person.
In this section “associate” has the same meaning as in Part 10 of CTA 2010 (see section 448 of that Act); but for this purpose section 448 is to be read as if the words “or partner” were omitted in subsection (1)(a).
For the purposes of this Part a person is to be treated as connected to a cell company where, if any cell of the company were a separate company, the person would be connected to that separate company.
For the purposes of this section a company is a “cell company” if it meets the first or second condition.
The first condition is that under the law under which the company is incorporated or formed, under the company's articles of association or other document regulating the company or under arrangements entered into by or in relation to the company—
some or all of the assets of the company are available primarily, or only, to meet particular liabilities of the company, and
some or all of the members of the company, and some or all of its creditors, have rights primarily, or only, in relation to particular assets of the company.
The second condition is that the company's articles of association, or other document regulating it, establish an entity (by whatever name known) which—
under the law under which the company is incorporated or formed, has legal personality distinct from that of the company, and
which is not itself a company.
For the purposes of this section a “cell”, in relation to a cell company, is—
an identifiable part of the company (by whatever name known) that carries on distinct business activities and to which particular assets and liabilities of the company are primarily or wholly attributable, or
an entity of the kind specified in subsection (4).
In this Part— “chargeable day” (in relation to a single-dwelling interest) is to be read in accordance with section 170; “chargeable interest” has the meaning given by section 107; “the chargeable person” has the meaning given by section 96(2) or (3); “closure notice” has the meaning given by paragraph 16 of Schedule 33; “collective investment scheme” has the same meaning as in Part 17 of the Financial Services and Markets Act 2000 (see section 235 of that Act); “company” has the meaning given by section 166(1); “completion”, in Scotland, means— in relation to a lease, when it is executed by the parties (that is to say, by signing) or constituted by any means, in relation to any other transaction, the settlement of the transaction; “discovery assessment” has the meaning given by paragraph 21 of Schedule 33; “EEAUCITS” has the same meaning as in Part 17 of the Financial Services and Markets Act 2000 (see section 237 of that Act); “excluded rents” has the meaning given by section 133(6); “farming” has the meaning given by section 148(4); “filing date”, in relation to an annual tax on enveloped dwellings return or a return of the adjusted chargeable amount, has the meaning given by paragraph 58 of Schedule 33; “financial institution” has the meaning given by section 143 (except where otherwise stated); “HMRC” means Her Majesty's Revenue and Customs; “HMRC determination” has the meaning given by paragraph 18 of Schedule 33; “jointly entitled” means— in England and Wales, beneficially entitled as joint tenants or tenants in common, in Scotland, entitled as joint owners or owners in common, in Northern Ireland, beneficially entitled as joint tenants, tenants in common or coparceners; “land” includes— buildings and structures, and land covered by water; “market value” has the meaning given by section 98(8); “notice of enquiry” has the meaning given by paragraph 8 of Schedule 33; “open-ended investment company” has the same meaning as in Part 17 of the Financial Services and Markets Act 2000 (see section 236(1) of that Act); “participant”, in relation to a collective investment scheme, has the meaning given by section 98(7); “partnership” has the meaning given by section 167; “property development trade” has the meaning given by section 138(4); “property rental business” has the meaning given by section 133(4); “property trading business” has the meaning given by section 141(3); “qualifying property rental business” has the meaning given by section 133(3); “self assessment” has the meaning given by section 161(3); “tax” means tax under this Part; “trade” has the same meaning as in section 35 of CTA 2009 (and cognate expressions are to be read accordingly); “unit trust scheme” has the same meaning as in Part 17 of the Financial Services and Markets Act 2000 (see section 237(1) of that Act).
In this Part—
In section 65 of IHTA 1984 (settlements without interests in possession etc: charge when property ceases to be relevant property etc), after subsection (7) insert—
The amendment made by this section is treated as having come into force on 16 October 2002.
Schedule 36 makes provision in relation to the treatment of liabilities for the purposes of inheritance tax.
IHTA 1984 is amended as follows.
In section 267 (persons treated as domiciled in United Kingdom), at the end insert—
After that section insert—
Section 18 of IHTA 1984 (transfers between spouses or civil partners) is amended as follows.
In subsection (2) (transfer to spouse or civil partner not domiciled in United Kingdom), for “£55,000” substitute “ the exemption limit at the time of the transfer, ”.
After subsection (2) insert—
The amendments made by this section have effect in relation to transfers of value made on or after 6 April 2013.
HODA 1979 is amended as follows.
In section 6(1A) (main rates)—
in paragraph (a) (unleaded petrol), for “£0.6097” substitute “ £0.5795 ”,
in paragraph (aa) (aviation gasoline), for “£0.3966” substitute “ £0.3770 ”,
in paragraph (b) (light oil other than unleaded petrol or aviation gasoline), for “£0.7069” substitute “ £0.6767 ”, and
in paragraph (c) (heavy oil), for “£0.6097” substitute “ £0.5795 ”.
In section 8(3) (road fuel gas)—
in paragraph (a) (natural road fuel gas), for “£0.2907” substitute “ £0.2470 ”, and
in paragraph (b) (other road fuel gas), for “£0.3734” substitute “ £0.3161 ”.
In section 11(1) (rebate on heavy oil)—
in paragraph (a) (fuel oil), for “£0.1126” substitute “ £0.1070 ”, and
in paragraph (b) (gas oil), for “£0.1172” substitute “ £0.1114 ”.
In section 14(1) (rebate on light oil for use as furnace fuel), for “£0.1126” substitute “ £0.1070 ”.
In section 14A(2) (rebate on certain biodiesel), for “£0.1172” substitute “ £0.1114 ”.
The following instruments are revoked—
Excise Duties (Surcharges or Rebates) (Hydrocarbon Oils etc) Order 2012 (S.I. 2012/3055), and
Excise Duties (Road Fuel Gas) (Reliefs) Regulations 2012 (S.I. 2012/3056).
The amendments and revocations made by this section are treated as having come into force on 1 April 2013.
ALDA 1979 is amended as follows.
In section 5 (rate of duty on spirits), for “£26.81” substitute “ £28.22 ”.
In section 36(1AA) (rates of general beer duty)—
in paragraph (za) (rate of duty on lower strength beer), for “£9.76” substitute “ £9.17 ”, and
in paragraph (a) (standard rate of duty on beer), for “£19.51” substitute “ £19.12 ”.
In section 37(4) (rate of high strength beer duty), for “£4.88” substitute “ £5.09 ”.
In section 62(1A) (rates of duty on cider)—
in paragraph (a) (rate of duty per hectolitre on sparkling cider of a strength exceeding 5.5 per cent), for “£245.32” substitute “ £258.23 ”,
in paragraph (b) (rate of duty per hectolitre on cider of a strength exceeding 7.5 per cent which is not sparkling cider), for “£56.55” substitute “ £59.52 ”, and
in paragraph (c) (rate of duty per hectolitre in any other case), for “£37.68” substitute “ £39.66 ”.
For the table in Schedule 1 substitute—Table of rates of duty on wine and made-wine .
The amendments made by this section are treated as having come into force on 25 March 2013.
1. Cigarettes An amount equal to 16.5 per cent of the retail price plus £176.22 per thousand cigarettes 2. Cigars £219.82 per kilogram 3. Hand-rolling tobacco £172.74 per kilogram 4. Other smoking tobacco and chewing tobacco £96.64 per kilogram
The amendment made by this section is treated as having come into force at 6 pm on 20 March 2013.
Section 1 of TPDA 1979 (tobacco products) is amended as follows.
In subsection (1), omit “, but does not include herbal smoking products”.
After that subsection insert—
In subsection (3), omit “but not including herbal smoking products”.
Omit subsection (6).
The amendments made by this section come into force on 1 January 2014.
Part of gross gaming yield Rate The first £2,242,500 15 per cent The next £1,546,000 20 per cent The next £2,707,500 30 per cent The next £5,714,500 40 per cent The remainder 50 per cent
The amendment made by this section has effect in relation to accounting periods beginning on or after 1 April 2013.
Section 20A of BGDA 1981 (combined bingo) is amended as follows.
In subsection (3) for the words from the beginning to “second promoter”)—” substitute “Where money representing such payments (so far as they constituted stakes hazarded in the combined bingo) is paid in an accounting period by one promoter of the bingo (“the first promoter”) to another (“the second promoter”), to the extent that the money is used (directly or indirectly) to provide bingo winnings for combined bingo promoted by the second promoter—”.
Omit subsection (4).
The amendments made by this section have effect in relation to accounting periods beginning on or after the day on which this Act is passed.
Section 30 of FA 1994 (air passenger duty: rates of duty) is amended as follows.
In subsection (3)—
in paragraph (a) for “£65” substitute “ £67 ”, and
in paragraph (b) for “£130” substitute “ £134 ”.
In subsection (4)—
in paragraph (a) for “£81” substitute “ £83 ”, and
in paragraph (b) for “£162” substitute “ £166 ”.
In subsection (4A)—
in paragraph (a) for “£92” substitute “ £94 ”, and
in paragraph (b) for “£184” substitute “ £188 ”.
The amendments made by this section have effect in relation to the carriage of passengers beginning on or after 1 April 2013.
In section 38 of FA 1994 (accounting for and payment of duty) after subsection (2) insert—
In Part 2 of Schedule 5A to FA 1994 (territories etc) at the appropriate place insert “ South Sudan ”.
The amendment made by subsection (2) has effect in relation to the carriage of passengers beginning on or after 9 July 2011.
Schedule 1 to VERA 1994 (annual rates of duty) is amended as follows.
In paragraph 1 (general)—
in sub-paragraph (2) (vehicle not covered elsewhere in Schedule otherwise than with engine cylinder capacity not exceeding 1,549cc), for “£220” substitute “ £225 ”, and
in sub-paragraph (2A) (vehicle not covered elsewhere in Schedule with engine cylinder capacity not exceeding 1,549cc), for “£135” substitute “ £140 ”.
In paragraph 1B (graduated rates of duty for light passenger vehicles)—
CO2 emissions figure Rate (1) (2) (3) (4) Exceeding Not exceeding Reduced rate Standard rate g/km g/km £ £ 130 140 115 125 140 150 130 140 150 165 165 175 165 175 275 285 175 185 325 335 185 200 465 475 200 225 610 620 225 255 830 840 255 1055 1065 CO2 emissions figure Rate (1) (2) (3) (4) Exceeding Not exceeding Reduced rate Standard rate g/km g/km £ £ 100 110 10 20 110 120 20 30 120 130 95 105 130 140 115 125 140 150 130 140 150 165 165 175 165 175 190 200 175 185 210 220 185 200 250 260 200 225 270 280 225 255 465 475 255 480 490
in the sentence immediately following the tables, for paragraphs (a) and (b) substitute—
In paragraph 1J (VED rates for light goods vehicles)—
in paragraph (a), for “£215” substitute “ £220 ”, and
in paragraph (b), for “£135” substitute “ £140 ”.
In paragraph 2(1) (VED rates for motorcycles)—
in paragraph (a), for “£16” substitute “ £17 ”,
in paragraph (b), for “£36” substitute “ £37 ”,
in paragraph (c), for “£55” substitute “ £57 ”, and
in paragraph (d), for “£76” substitute “ £78 ”.
The amendments made by this section have effect in relation to licences taken out on or after 1 April 2013.
In section 33 of VERA 1994 (not exhibiting licence), omit subsections (1B) to (1D).
After that section insert—
In consequence of the provision made by subsections (1) and (2) omit—
section 147 of FA 2008, and
in regulation 6 of the Road Vehicles (Registration and Licensing) Regulations 2002 (S.I. 2002/2742), paragraph (1) and, in paragraph (2), the words “Except where paragraph (1) applies,”.
VERA 1994 is amended as follows.
In section 7A (supplement payable on vehicle ceasing to be appropriately covered), in subsection (1A)(d) omit “within the immediately preceding period of 12 months”.
In Schedule 2A (immobilisation, removal and disposal of vehicles), in paragraph 1(10)(b) omit “within the immediately preceding period of 12 months”.
Schedule 37 makes provision about vehicle licences for disabled people.
In section 41 of VATA 1994 (application to the Crown), in subsection (7), after “Board” insert “ and a clinical commissioning group, the Health and Social Care Information Centre, the National Health Service Commissioning Board and the National Institute for Health and Care Excellence ”.
The amendment made by this section is treated as having come into force on 1 April 2013.
Schedule 38 contains provision about the valuation of certain supplies of fuel for the purposes of value added tax.
Group 2 (installation of energy-saving materials) of Part 2 of Schedule 7A to VATA 1994 (reduced rate supplies of goods and services) is amended as follows.
For items 1 and 2 substitute—
Omit Note 3 (meaning of “use for a relevant charitable purpose”).
The amendments made by this section have effect in relation to supplies made on or after 1 August 2013.
Section 45 of FA 2003 (contract and conveyance: effect of transfer of rights)—
has effect subject to the amendment in subsection (2) below in relation to agreements for the grant or assignment of an option that are entered into during the period beginning with 21 March 2012 and ending immediately before the day on which this Act is passed, and
has effect subject to the amendments in subsections (3) to (7) below in relation to transfers of rights (see subsection (1) of that section) entered into during that period.
At the end of subsection (1A) insert “ or an agreement for the future grant or assignment of an option ”.
In subsection (3), in the second sentence, after “except” insert “ in a case excluded by subsection (3A) or ”.
After subsection (3) insert—
In subsection (4), at the end insert “ except in a case excluded by subsection (4A) ”.
After subsection (4) insert—
In subsection (5)(b)—
after “subsection (3) above” insert “ or in subsection (3A) above ”, and
after “subsection (4)” insert “ or (4A) ”.
Subsections (10) to (12) apply where—
as a result of subsection (2) of this section, section 45 of FA 2003 does not apply in relation to a contract of the kind mentioned in subsection (1)(a) of that section (“the original contract”),
the original contract was substantially performed or completed (or, in a case that would have fallen within subsection (5) of that section, substantially performed or completed so far as relating to the relevant part of the subject-matter of the original contract) at the same time as, and in connection with, the substantial performance or completion of an agreement for the grant or assignment of an option, and
that time fell before the day on which this Act is passed.
Subsections (10) to (12) also apply where—
section 45 of FA 2003 applies in relation to the contract for a land transaction (“the original contract”),
as a result of subsections (1) to (7) above, the substantial performance or completion of the original contract (or, in a case within subsection (5) of that section, its substantial performance or completion so far as relating to part of the subject-matter of the original contract) is not disregarded, and
the relevant time referred to in subsection (3A)(a) of that section fell before the day on which this Act is passed.
Section 76 of FA 2003 (duty to deliver land transaction return) is to be regarded as requiring the purchaser under the original contract to deliver a land transaction return relating to the land transaction not later than 30 September 2013.
Accordingly, 30 September 2013 is for the purposes of Part 4 of FA 2003 the filing date for the land transaction return relating to the transaction.
If the purchaser under the original contract (“P”) has delivered a land transaction return relating to the land transaction before the day on which this Act is passed, P must not later than 30 September 2013 give notice under paragraph 6 of Schedule 10 to FA 2003 amending the return, but this does not prevent P from making subsequent amendments within the time allowed by sub-paragraph (3) of that paragraph.
Schedule 39 contains provisions about certain transactions relating to a contract that is to be completed by a conveyance.
Schedule 40 contains provisions about relief from the higher rate of stamp duty land tax.
Schedule 41 contains provision about stamp duty land tax in relation to leases.
Section 42 of FA 1996 (amount of landfill tax) is amended as follows.
In subsection (1)(a) (standard rate), for “£72” substitute “ £80 ”.
In subsection (2) (reduced rate) for “£72” substitute “ £80 ”.
The amendments made by this section have effect in relation to disposals made (or treated as made) on or after 1 April 2014.
Taxable commodity supplied Rate at which levy payable if supply is not a reduced-rate supply or a supply for use in scrap metal recycling Electricity £0.00541 per kilowatt hour Gas supplied by a gas utility or any gas supplied in a gaseous state that is of a kind supplied by a gas utility £0.00188 per kilowatt hour Any petroleum gas, or other gaseous hydrocarbon, supplied in a liquid state £0.01210 per kilogram Any other taxable commodity £0.01476 per kilogram
The amendment made by subsection (1) has effect in relation to supplies treated as taking place on or after 1 April 2014.
Schedule 42 amends Schedule 6 to FA 2000 (climate change levy).
In Schedule 7A to FA 1994 (IPT: contracts that are not taxable), paragraph 3 (contracts relating to motor vehicles for use by handicapped persons) is amended as follows.
In sub-paragraph (2)(a)—
after “disability living allowance” insert “ , or personal independence payment, ” and
after “component” insert “ , or of an armed forces independence payment ”.
In sub-paragraph (3), after “disability living allowance” insert “ , personal independence payment, armed forces independence payment ”.
After sub-paragraph (4)(b) insert—.
The amendments made by this section are treated as having come into force on 8 April 2013.
Schedule 19 to FA 2011 (bank levy) is amended as follows.
In paragraph 6 (steps for determining the amount of the bank levy), in sub-paragraph (2)—
for “0.044%” substitute “ 0.065% ”, and
for “0.088%” substitute “ 0.130% ”.
In paragraph 7 (special provision for chargeable periods falling wholly or partly before 1 January 2013), in sub-paragraph (2) (as substituted by paragraph 6 of Schedule 34 to FA 2012), in the table in the substituted Step 7—
in the second column for “0.0525%” substitute “ 0.065% ”, and
in the third column for “0.105%” substitute “ 0.130% ”.
In Schedule 34 to FA 2012 (bank levy)—
omit paragraph 5 (which substituted new rates from 1 January 2013), and
in paragraph 7 for “paragraphs 5 and” substitute “ paragraph ”.
The amendments made by subsections (2) to (4) are treated as having come into force on 1 January 2013 (and accordingly the paragraph repealed by subsection (4) is treated as never having come into force).
Subsections (7) to (13) apply where—
an amount of the bank levy is treated as if it were an amount of corporation tax chargeable on an entity (“E”) for an accounting period of E,
the chargeable period in respect of which the amount of the bank levy is charged falls (or partly falls) on or after 1 January 2013, and
under the Instalment Payment Regulations, one or more instalment payments, in respect of the total liability of E for the accounting period, were treated as becoming due and payable before the commencement date (“pre-commencement instalment payments”).
Subsections (1) to (5) are to be ignored for the purpose of determining the amount of any pre-commencement instalment payment.
If there is at least one instalment payment, in respect of the total liability of E for the accounting period, which under the Instalment Payment Regulations is treated as becoming due and payable on or after the commencement date (“post-commencement instalment payments”), the amount of that instalment payment, or the first of them, is to be increased by the adjustment amount.
If there are no post-commencement instalment payments, a further instalment payment, in respect of the total liability of E for the accounting period, of an amount equal to the adjustment amount is to be treated as becoming due and payable at the end of the period of 30 days beginning with the commencement date.
“The adjustment amount” is the difference between—
the aggregate amount of the pre-commencement instalments determined in accordance with subsection (7), and
the aggregate amount of those instalment payments determined ignoring subsection (7) (and so taking account of subsections (1) to (5)).
In the Instalment Payment Regulations—
in regulations 6(1)(a), 7(2), 8(1)(a) and (2)(a), 9(5), 10(1), 11(1) and 13, references to regulation 4A, 4B, 4C, 4D, 5, 5A or 5B of those Regulations are to be read as including a reference to subsections (6) to (10) (and in regulation 7(2) “the regulation in question”, and in regulation 8(2) “that regulation”, are to be read accordingly), and
in regulation 9(3), the reference to those Regulations is to be read as including a reference to subsections (6) to (10).
In section 59D of TMA 1970 (general rule as to when corporation tax is due and payable), in subsection (5), the reference to section 59E is to be read as including a reference to subsections (6) to (11).
In this section— and references to the total liability of E for an accounting period are to be construed in accordance with regulation 2(3) of the Instalment Payment Regulations.
references to the “adjusted chargeable amount”, in relation to a person on whom tax is charged for a chargeable period with respect to a single-dwelling interest, are to be read in accordance with section 105;
In section 498 (no charge on shares ceasing to be subject to plan in certain circumstances) in subsection (2)(e) omit the words from “on” to “2)”.
In section 31 of ITTOIA 2005 (relationship between rules prohibiting and allowing deductions), in subsection (2), omit the “or” at the end of paragraph (b) and after paragraph (c) insertor .
Part 14 of CTA 2010 (change in company ownership) is amended as follows. In section 672 (overview of Part)— After Chapter 5 insert— In section 721 (when things other than share capital may be taken into account: Chapters 2 to 5)— In section 725 (provision applying for the purposes of Chapters 2 to 5)— In section 730 (meaning of “relevant non-trading debit”)—
The amendments made by this Schedule have effect in relation to a qualifying change if the relevant day is on or after 20 March 2013. But those amendments do not have effect if before that date— If— those amendments have effect in relation to the qualifying change as if section 730C(9)(b) were omitted.
Section 826 of ICTA (interest on tax overpaid) is amended as follows. In subsection (1), after paragraph (f) insert—. In subsection (3C), after “film tax credit” insert “ , television tax credit or video game tax credit ”. In subsection (8A)(b)(ii), after “film tax credit” insert “ or television tax credit or video game tax credit ”. In subsection (8BA), after “film tax credit” (in both places) insert “ or television tax credit or video game tax credit ”.
In Schedule 24 to FA 2007 (penalties for errors), in paragraph 28(fa) (meaning of “corporation tax credit”), omit the “or” at the end of sub-paragraph (iv) and after that sub-paragraph insert—.
Part 8A of CTA 2010 (profits arising from the exploitation of patents etc) is amended as follows.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Part 7 of ITA 2007 (community investment tax relief) is amended as follows.
An officer of Revenue and Customs may enquire into a return if sub-paragraph (2) has been complied with. Notice of the intention to make an enquiry must be given— The relevant date is— A return that has been the subject of one notice under this paragraph may not be the subject of another, except a notice given in consequence of an amendment (or another amendment) of the return under paragraph 3. A notice under this paragraph is referred to as a “notice of enquiry”.
At any time when an enquiry is in progress into a return any question arising in connection with the subject-matter of the return may be referred to the tribunal for determination. Notice of the referral must be given to the tribunal jointly by the relevant person and an officer of Revenue and Customs. 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—
A determination under paragraph 11 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 officer of Revenue and Customs conducting the enquiry must take the determination into account— The question determined may not be reopened on an appeal, except to the extent that it could be reopened if it had been determined as a preliminary issue in that appeal.
The relevant person may apply to the tribunal for a direction that a closure notice is to be given within a specified period. The tribunal hearing the application must give a direction unless satisfied that HMRC have reasonable grounds for not giving a closure notice within that period. In this paragraph “the tribunal” means—
This paragraph applies where— Any obligation to deliver a return with respect to the single-dwelling interest for the chargeable period concerned is a joint obligation of the persons who are jointly and severally liable under subsection (2) or (as the case may be) (4) of section 97; and a single return is required.
“Filing date”, in relation to a return, means the day by the end of which the return is required to be delivered.
Annual tax on enveloped dwellings Annual tax on enveloped dwellings return. Annual tax on enveloped dwellings Return of adjusted chargeable amount.
In enactments relating to relevant tax, a reference to being resident (or not resident) in the UK is, in the case of individuals, a reference to being resident (or not resident) in the UK in accordance with the statutory residence test. Sub-paragraph (1) applies even if the reference relates to the tax liability of an actual or deemed person that is not an individual (for example, where the liability of another person depends on the residence status of an individual). An individual who, in accordance with the statutory residence test, is resident (or not resident) in the UK “for” a tax year is taken for the purposes of any enactment relating to relevant tax to be resident (or not resident) there at all times in that tax year. But see Part 3 of this Schedule (split year treatment) for cases where the effect of sub-paragraph (3) is relaxed in certain circumstances. This Schedule has effect subject to any express provision to the contrary in (or falling to be recognised and acknowledged in law by virtue of) any enactment.
There are 4 automatic UK tests.
The Table below shows how many UK ties are sufficient in a case where P was resident in the UK for one or more of the 3 tax years preceding year X— Days spent by P in the UK in year X Number of ties that are sufficient More than 15 but not more than 45 At least 4 More than 45 but not more than 90 At least 3 More than 90 but not more than 120 At least 2 More than 120 At least 1
In this Schedule—
This paragraph applies if— The question under this Schedule is to be determined in accordance with the rules in force for determining an individual’s residence for that pre-commencement tax year (and not in accordance with the statutory residence test). But an individual may by notice in writing to Her Majesty’s Revenue and Customs elect, as respects one or more pre-commencement tax years, for the question under this Schedule to be determined instead in accordance with the statutory residence test. A notice under sub-paragraph (3)— Unless, in relation to a pre-commencement tax year, an election is made under sub-paragraph (3) as respects that year—
TCGA 1992 is amended as follows.
In section 22 of F(No.2)A 1931 (provisions in cases where Treasury has power to borrow money), in subsection (1)(a) and (b), omit “ordinarily”. Nothing in sub-paragraph (1) limits the power conferred by section 60(1) of FA 1940. Subject to sub-paragraph (5), the amendment made by sub-paragraph (1) does not affect a pre-commencement security (nor the availability of the relevant exemption). Sub-paragraph (5) applies to a person who becomes the beneficial owner of a pre-commencement security (or an interest in such a security) on or after 6 April 2013. If obtaining the relevant exemption is conditional on being not ordinarily resident in the United Kingdom, any enactment conferring the exemption is to have effect (in relation to a person to whom this sub-paragraph applies) as if obtaining the exemption were conditional instead on being not resident in the United Kingdom. In this paragraph—
Part 4 of FA 2004 (pension schemes etc) is amended as follows.
In Schedule 2 to the Commissioners for Revenue and Customs Act 2005 (restrictions on functions of Commissioner and officers), omit—
paragraphs 13 and 13A, and
the italic heading immediately preceding those paragraphs.
The amendments made by this Schedule have effect— In sub-paragraph (1)(a), “relevant period” means a period in respect of which a return is required.
In Part 4 of Schedule 2 (types of shares that may be awarded) in paragraph 32 (provision for forfeiture) in sub-paragraph (2)(e) omit the words from “on” to “98)”.
In section 56 of ITTOIA 2005 (rules allowing deductions: professions and vocations), after “marks)” insert “ and section 97A (cash basis: value of trading stock on cessation of trade) ”.
Section 357CG (adjustments in calculating profits of trade) is amended as follows. In subsection (3), omit the “and” at the end of paragraph (a) and after paragraph (b) insert— After subsection (5) insert— In subsection (6)—
In section 335 (form and amount of CITR) in subsection (3) for “this purpose” substitute “ the purposes of this section and section 335A ”.
The first automatic UK test is that P spends at least 183 days in the UK in year X.
The Table below shows how many UK ties are sufficient in a case where P was resident in the UK for none of the 3 tax years preceding year X— Days spent by P in the UK in year X Number of ties that are sufficient More than 45 but not more than 90 All 4 More than 90 but not more than 120 At least 3 More than 120 At least 2
In relation to an individual who carries on a trade—
a reference in this Schedule to annual leave or parenting leave is to reasonable amounts of time off from work for the same purposes as the purposes for which annual leave or parenting leave is taken, and
what are “reasonable amounts” is to be assessed having regard to the annual leave or parenting leave to which an employee might reasonably expect to be entitled if doing similar work.
This paragraph applies if— The provision is to have effect as if— Where the provision also refers to cases involving actual or deemed departure from the UK, the reference is to be read and given effect so far as possible in accordance with the terms of the relevant ESC. “The relevant ESC” means whichever of the extra-statutory concessions to which effect is given by Part 3 of this Schedule is relevant in the individual’s case.
Section 2 (persons and gains chargeable to capital gains tax, and allowable losses) is amended as follows. In subsection (1), for the words from “during any part” to the end substitute “if the residence condition is met”. After that subsection insert—
In section 185G (disposal by person holding directly), in subsection (3)(a), omit “, ordinarily resident”.
Part 11 of Schedule 2 (supplementary provisions) is amended as follows.
Omit section 160 of ITTOIA 2005 (cash basis of calculation for barristers and advocates in early years of practice).
After section 357CH insert—
After section 335 insert—
The second automatic UK test is that— Condition A is that P has no home overseas. Condition B is that— In relation to a home of P’s in the UK, P “spends a sufficient amount of time” there in year X if there are at least 30 days in year X when P is present there on that day for at least some of the time (no matter how short a time). In relation to a home of P’s overseas, P “spends no more than a permitted amount of time” there in year X if there are fewer than 30 days in year X when P is present there on that day for at least some of the time (no matter how short a time). In sub-paragraphs (4) and (5)— Sub-paragraph (1)(c) is satisfied so long as there is a period of 91 days in respect of which the conditions described there are met, even if those conditions are in fact met for longer than that. If P has more than one home in the UK—
If P dies in year X, paragraph 18 has effect as if the words “More than 15 but” were omitted from the first column of the Table. In addition to that modification, if the death occurs before 1 March in year X, paragraphs 18 and 19 have effect as if each number of days mentioned in the first column of the Table were reduced by the appropriate number. The appropriate number is found by multiplying the number of days, in each case, by— where “A” is the number of whole months in year X after the month in which P dies. If, for any number of days, the appropriate number is not a whole number, the appropriate number is to be rounded up or down as follows—
A reference in this Schedule to a number of days being less than a specified number includes a case where the number of days is zero.
Sub-paragraph (2) applies in determining whether the test in paragraph 50(3) is met where the relevant year is the tax year 2013-14. The circumstances of a partner of the taxpayer are to be treated as falling within Case 6 for the previous tax year if the partner was eligible for split year treatment in relation to that tax year under the relevant ESC on the grounds that he or she returned to the United Kingdom after a period working overseas full-time. Where the circumstances of a partner are treated as falling within Case 6 under sub-paragraph (2), the reference in paragraph 50(7)(b) to the UK part of the relevant year as defined for Case 6 is a reference to the part corresponding, so far as possible, in accordance with the terms of the relevant ESC, to the UK part of that year. “The relevant ESC” means whichever of the extra-statutory concessions to which effect is given by Part 3 of this Schedule is relevant in the partner’s case.
In section 10 (non-resident with United Kingdom branch or agency), in subsection (1), for “in which he is not resident and not ordinarily resident in the United Kingdom but” substitute “if the residence condition is not met (see section 2(1A)) but the person”.
In section 205 (short service refund lump sum charge), in subsection (3), omit “, ordinarily resident”.
Omit paragraph 98 (meaning of “specified retirement age”).
Chapter 17 of Part 2 of ITTOIA 2005 (adjustment income) is amended as follows. In section 229(2)(a), for “sections 237 to 239” substitute “ sections 237 to 239B ”. Omit sections 238 and 239 (spreading of adjustment income: barristers and advocates).
Section 357CK (deductions that are not routine deductions) is amended as follows. In subsection (1), at the end insert— After subsection (7) insert—
In section 357 (attribution of CITR) after subsection (4) insert—
The third automatic UK test is that— Take the following steps to work out, for any given period of 365 days, whether P works “sufficient hours in the UK” as assessed over that period— Step 1 Identify any days in the period on which P does more than 3 hours’ work overseas, including ones on which P also does work in the UK on the same day. The days so identified are referred to as “disregarded days”. Step 2 Add up (for all employments held and trades carried on by P) the total number of hours that P works in the UK during the period, but ignoring any hours that P works in the UK on disregarded days. The result is referred to as P’s “net UK hours”. Step 3 Subtract from 365— the total number of disregarded days, and any days that are allowed to be subtracted, in accordance with the rules in paragraph 28 of this Schedule, to take account of periods of leave and gaps between employments. The result is referred to as the “reference period”. Step 4 Divide the reference period by 7. If the answer is more than 1 and is not a whole number, round down to the nearest whole number. If the answer is less than 1, round up to 1. Step 5 Divide P’s net UK hours by the number resulting from step 4. If the answer is 35 or more, P is considered to work “sufficient hours in the UK” as assessed over the 365-day period in question. This paragraph does not apply to P if—
This paragraph applies in determining whether the test in paragraph 110(1)(c) is met in relation to a tax year before the tax year 2013-14 (a “pre-commencement tax year”). Paragraph 110(1) is to have effect as if for paragraph (c) there were substituted— Whether an individual was resident in the UK for a pre-commencement tax year is to be determined in accordance with the rules in force for determining an individual’s residence for that pre-commencement tax year (and not in accordance with the statutory residence test).
Section 13 (attribution of gains to members of non-resident companies) is amended as follows. In subsection (2), omit “or ordinarily resident”. In subsection (10), for “neither resident nor ordinarily resident” substitute “not resident”. In subsection (13)(b), omit “or ordinarily resident”.
In section 205A (serious ill-health lump sum charge), in subsection (3), omit “, ordinarily resident”.
In paragraph 100 (index of defined expressions) omit the entry for “the specified retirement age”.
the cash basis (in Part 2) section 25A”; “entering the cash basis (in Chapter 17A of Part 2) section 240B
Section 361 (disposal of securities or shares during 5 year period) is amended as follows. For subsection (3) substitute— Omit subsections (5) to (7).
The fourth automatic UK test is that— In relation to a home of P’s overseas, P “spent a sufficient amount of time” there in year X if— In sub-paragraph (2)— If P had more than one home overseas—
The existing temporary non-resident provisions, as in force immediately before the day on which this Act is passed, continue to have effect on and after that day in any case where the year of departure (as defined in Part 4 of this Schedule) is a tax year before the tax year 2013-14. Where those provisions continue to have effect by virtue of sub-paragraph (1)— The existing temporary non-resident provisions are—
In section 16 (computation of losses), in subsection (3), for “during no part of which he is resident or ordinarily resident in the United Kingdom” substitute “where the residence condition is not met (see section 2(1A))”.
In section 206 (special lump sum death benefits charge), in subsection (3), omit “, ordinarily resident”.
The amendments made by paragraphs 1 to 5 above have effect in relation to investments made on or after 6 April 2013.
Section 13 of FA 2012 (Champions League final 2013) is to be read and given effect, on and after the day on which this Act is passed, as if section 218 and this Schedule had not been enacted.
In section 62 (death: general provisions), in subsection (3), omit “, ordinary residence,”.
In section 207 (authorised surplus payments charge), in subsection (3), omit “, ordinarily resident”.
In section 65 (liability for tax of trustees or personal representatives), in subsection (3)(b), for “become neither resident nor ordinarily resident” substitute “cease to be resident”.
In section 208 (unauthorised payments charge), in subsection (4), omit “, ordinarily resident”.
In section 67 (provisions applicable where section 79 of the Finance Act 1980 has applied), in subsection (6)(a), in paragraph (b) of the substituted subsection (1), for “becomes neither resident nor ordinarily resident” substitute “ceases to be resident”.
In section 209 (unauthorised payments surcharge), in subsection (5), omit “, ordinarily resident”.
Section 69 (trustees of settlements) is amended as follows. In subsection (2), omit “and ordinarily resident”. In subsection (2B)(c), omit “, ordinarily resident”. In subsection (2E), for the words from “and ordinarily resident” to the end substitute “in the United Kingdom, then for the purposes of this Act it is treated as being not resident in the United Kingdom”.
In section 217 (persons liable to lifetime allowance charge), in subsection (5), omit “, ordinarily resident”.
In section 76 (disposal of interests in settled property), in subsection (1B)(a), for “neither resident nor ordinarily resident” substitute “not resident”.
In section 237A (liability of individual to annual allowance charge), in subsection (2), omit “, ordinarily resident”.
In section 80 (trustees ceasing to be resident in UK), in subsection (1), for “neither resident nor ordinarily resident” substitute “not resident”.
In section 237B (liability of scheme administrator), in subsection (8), omit “, ordinarily resident”.
Section 81 (death of trustee: special rules) is amended as follows. In subsection (1)(b), omit “and ordinarily resident”. In subsection (3)(b), omit “and ordinarily resident”. In subsection (4)(b), omit “and ordinarily resident”. In subsection (5)(a), omit “and ordinarily resident”.
In section 239 (scheme sanction charge), in subsection (4), omit “, ordinarily resident”.
In section 82 (past trustees: liability for tax), in subsection (3)(b), for “become neither resident nor ordinarily resident” substitute “cease to be resident”.
In section 242 (de-registration charge), in subsection (3), omit “, ordinarily resident”.
In section 83 (trustees ceasing to be liable to UK tax), in subsection (1), omit “and ordinarily resident”.
The amendments of Part 4 of FA 2004 made by this Part of this Schedule have effect in relation to the tax year 2013-14 and any subsequent tax year.
Section 83A (trustees both resident and non-resident in a year of assessment) is amended as follows. In subsection (3)(a), omit “and ordinarily resident”. In subsection (4)—
In section 84 (acquisition by dual resident trustees), in subsection (1)(b), omit “and ordinarily resident”.
In section 85 (disposal of interests in non-resident settlements), in subsection (1), for “neither resident nor ordinarily resident” substitute “not resident”.
Section 86 (attribution of gains to settlors with interest in non-resident or dual resident settlements) is amended as follows. In subsection (1)(c), for the words from “either resident” to the end substitute “resident in the United Kingdom for the year”. For subsection (2) substitute— In subsection (3), omit “and ordinarily resident”.
Section 87 (non-UK resident settlements: attribution of gains to beneficiaries) is amended as follows. In subsection (1), for the words from “the trustees” to the end substitute “there is no time in that year when the trustees are resident in the United Kingdom”. In subsection (4)(a), omit “and ordinarily resident”.
In section 88(1) (gains of dual resident settlements)—
in paragraph (a), omit “and ordinarily resident”, and
in paragraph (b), omit “and ordinary residence”.
Section 96 (payments by and to companies) is amended as follows. In subsection (3), omit “or ordinarily resident”. In subsection (4), in each of paragraphs (a) and (b), omit “or ordinarily resident”. In subsection (5)(b), omit “or ordinary residence”.
In section 97 (supplementary provisions), in subsection (1)(a), for “neither resident nor ordinarily resident” substitute “not resident”.
In section 99 (application of Act to unit trust schemes), in subsection (1)(c), omit “and ordinarily resident”.
In section 106A(5A) (identification of securities: capital gains tax)—
in paragraph (a), for “neither resident nor ordinarily resident” substitute “not resident”, and
in paragraph (b), omit “or ordinarily resident”.
Section 159 (non-residents: roll-over relief) is amended as follows. In subsection (2)(b), omit “or ordinarily resident”. In subsection (5), in the definition of “dual resident”, omit “or ordinarily resident”.
Section 166 (gifts to non-residents) is amended as follows. In subsection (1), for “neither resident nor ordinarily resident” substitute “not resident”. In subsection (2)(a), omit “or ordinarily resident”.
Section 167 (gifts to foreign-controlled companies) is amended as follows. In subsection (2)(a), for “neither resident nor ordinarily resident” substitute “not resident”. In subsection (3), for the words from “or ordinarily resident” to “nor ordinarily resident” substitute “in the United Kingdom is to be regarded as not resident”.
Section 168 (emigration of donee) is amended as follows. In subsection (1)(b), for “becomes neither resident nor ordinarily resident” substitute “ceases to be resident”. In subsection (4), for “becoming neither resident nor ordinarily resident” substitute “ceasing to be resident”. In subsection (5)—
In section 169 (gifts into dual resident trusts), in subsection (3)(a), omit “and ordinarily resident”.
In section 199 (exploration or exploitation assets: deemed disposals), in subsection (2), for “who is not resident and not ordinarily resident in the United Kingdom” substitute “in respect of whom the residence condition (see section 2(1A)) is not met”.
Section 261 (section 260 relief: gifts to non-residents) is amended as follows. In subsection (1), for “neither resident nor ordinarily resident” substitute “not resident”. In subsection (2)(a), omit “or ordinarily resident”.
In Schedule 1 (application of exempt amount and reporting limits in cases involving settled property), in paragraph 2(7)(a), omit “and ordinarily resident”.
Schedule 4A (disposal of interest in settled property: deemed disposal of underlying assets) is amended as follows. In paragraph 5(1) and (2), omit “and ordinarily resident”. In paragraph 6(1)— If any of the previous 5 years of assessment mentioned in paragraph 6(1) of Schedule 4A ends before 6 April 2013, the test in that paragraph is to be applied, as respects any such year ending before that date, as if that paragraph had not been amended by sub-paragraph (3).
Schedule 4C (transfers of value: attribution of gains to beneficiaries) is amended as follows. In paragraph 1A(3), for the words from “the beneficiary” to the end substitute “, as respects that year, the beneficiary meets the residence condition set out in section 2(1A)”. In paragraph 4— In paragraph 5(1)— In paragraph 9(3)(a)(i), omit “and ordinarily resident”. In paragraph 10(1), omit “and ordinarily resident”.
Schedule 5 (attribution of gains to settlors with interest in non-resident or dual resident settlement) is amended as follows. In paragraph 2A(4)— In paragraph 9(4)— The amendments made by this paragraph apply to changes in the residence status of trustees on or after 6 April 2013.
Schedule 5A (settlements with foreign element: information) is amended as follows. In paragraph 2(1)— In paragraph 3— In paragraph 4— In paragraph 5(1)— The amendments made by this paragraph apply as follows—
Schedule 5B (enterprise investment scheme: re-investment) is amended as follows. In paragraph 1— In paragraph 3(3)(b), omit “or ordinarily resident”. In paragraph 19(1), in the definition of “non-resident”, for “neither resident nor ordinarily resident” substitute “not resident”. The amendments made by this paragraph apply in cases where the accrual time is on or after 6 April 2013 (even if the qualifying investment was made before that date).
In Schedule 7C (reliefs for transfers to approved share plans), in paragraph 8, for paragraph (a) substitute—.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Schedule 19 to FA 2011 (bank levy) is amended as follows.
In paragraph 6 (steps for determining the amount of the bank levy), in sub-paragraph (2)—
for “0.065%” substitute “0.071%”, and
for “0.130%” substitute “0.142%”.
In paragraph 7 (special provision for chargeable periods falling wholly or partly before 1 January 2013).
In sub-paragraph (1) for “2013” substitute “2014”.
In sub-paragraph (2) (as substituted by paragraph 6 of Schedule 34 to FA 2012), in the table in the substituted Step 7—
1 January 2013 to 31 December 2013
Any time on or after 1 January 2014 0.071% 0.142%
In the italic heading immediately before that paragraph for “2013” substitute “2014”.
Accordingly, in Schedule 34 to FA 2012 (bank levy), omit paragraph 6(2).
The amendments made by this section come into force on 1 January 2014.
Schedule 19 to FA 2011 (the bank levy) is amended as follows.
In paragraph 46 (bank levy to be ignored for purposes of corporation tax and income tax), in paragraph (b), after “paid” insert “ (directly or indirectly) ”.
In Part 7 (double taxation relief), after paragraph 69 insert—
Accordingly—
in paragraph 3, after “double taxation relief” insert “ and with the deduction of foreign levies for the purposes of corporation tax and income tax ”, and
in the heading for Part 7, after “RELIEF” insert “ ETC ”
The amendments made by this section have effect in relation to any period of account beginning on or after 1 January 2013.
The amendments made by subsections (3) and (4) also have effect in relation to any period of account beginning before that date, but only if, and to the extent that, the tax is the subject of a claim for relief under paragraph 66 or 67 of Schedule 19 to FA 2011 (bank levy: double taxation relief) made on or after 5 December 2012.
For the purposes of subsections (5) and (6), a period of account beginning before, and ending on or after 1 January 2013 is to be treated as if so much of the period as falls before that date, and so much of the period as falls on or after that date, were separate periods of account.
In paragraph 70 of Schedule 19 to FA 2011 (bank levy: definitions), in sub-paragraph (1), in the definition of “high quality liquid asset” for “section 12.7.2(1) to (4)” substitute “section 12.7 (assets that are eligible for inclusion in a firm's regulatory liquid assets buffer)'.
The amendment made by this section has effect in relation to chargeable periods ending on or after 1 January 2011, and in relation to those chargeable periods the amendment is to be treated as always having had effect.
This Part has effect for the purpose of counteracting tax advantages arising from tax arrangements that are abusive.
The rules of this Part are collectively to be known as “the general anti-abuse rule”.
The general anti-abuse rule applies to the following taxes—
income tax,
corporation tax, including any amount chargeable as if it were corporation tax or treated as if it were corporation tax,
capital gains tax,
petroleum revenue tax,
inheritance tax,
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
apprenticeship levy,
stamp duty land tax, and
annual tax on enveloped dwellings.
multinational top-up tax.
domestic top-up tax.
Arrangements are “tax arrangements” if, having regard to all the circumstances, it would be reasonable to conclude that the obtaining of a tax advantage was the main purpose, or one of the main purposes, of the arrangements.
Tax arrangements are “abusive” if they are arrangements the entering into or carrying out of which cannot reasonably be regarded as a reasonable course of action in relation to the relevant tax provisions, having regard to all the circumstances including—
whether the substantive results of the arrangements are consistent with any principles on which those provisions are based (whether express or implied) and the policy objectives of those provisions,
whether the means of achieving those results involves one or more contrived or abnormal steps, and
whether the arrangements are intended to exploit any shortcomings in those provisions.
Where the tax arrangements form part of any other arrangements regard must also be had to those other arrangements.
Each of the following is an example of something which might indicate that tax arrangements are abusive— but in each case only if it is reasonable to assume that such a result was not the anticipated result when the relevant tax provisions were enacted.
the arrangements result in an amount of income, profits or gains for tax purposes that is significantly less than the amount for economic purposes,
the arrangements result in deductions or losses of an amount for tax purposes that is significantly greater than the amount for economic purposes, and
the arrangements result in a claim for the repayment or crediting of tax (including foreign tax) that has not been, and is unlikely to be, paid,
The fact that tax arrangements accord with established practice, and HMRC had, at the time the arrangements were entered into, indicated its acceptance of that practice, is an example of something which might indicate that the arrangements are not abusive.
The examples given in subsections (4) and (5) are not exhaustive.
A “tax advantage” includes—
relief or increased relief from tax,
repayment or increased repayment of tax,
avoidance or reduction of a charge to tax or an assessment to tax,
avoidance of a possible assessment to tax,
deferral of a payment of tax or advancement of a repayment of tax, and
avoidance of an obligation to deduct or account for tax.
If there are tax arrangements that are abusive, the tax advantages that would (ignoring this Part) arise from the arrangements are to be counteracted by the making of adjustments.
The adjustments required to be made to counteract the tax advantages are such as are just and reasonable.
The adjustments may be made in respect of the tax in question or any other tax to which the general anti-abuse rule applies.
The adjustments that may be made include those that impose or increase a liability to tax in any case where (ignoring this Part) there would be no liability or a smaller liability, and tax is to be charged in accordance with any such adjustment.
Any adjustments required to be made under this section (whether by an officer of Revenue and Customs or anyone else) may be made by way of an assessment, the modification of an assessment, amendment or disallowance of a claim, or otherwise.
But— The provision made by this subsection needs to be read with sections 209AA to 209AC and has no effect on adjustments so far as made otherwise than by virtue of this section.
the effect of adjustments made by an officer of Revenue and Customs by virtue of this section is suspended until the procedural requirements of Schedule 43, 43A or 43B have been complied with, and
the power to make adjustments by virtue of this section is subject to any time limit imposed by or under any enactment other than this Part.
Any adjustments made under this section have effect for all purposes.
The procedural requirements mentioned in subsection (6)(a) include any procedural requirements which apply under or by virtue of Schedule 43D (which makes provision in relation to partnerships).
Where a matter is referred to the GAAR Advisory Panel under paragraph 5 or 6 of Schedule 43 in relation to any tax arrangements, no GAAR-related adjustments may be made in the period (“the closed period”) that—
begins with the 31st day after the end of the 45 day period mentioned in paragraph 4(1) of Schedule 43, and
ends immediately before the day on which the notice under paragraph 12 of Schedule 43 is given in relation to the tax arrangements.
Where a pooling notice or notice of binding has been given in relation to any tax arrangements, no GAAR-related adjustments may be made in the period (“the closed period”) that—
begins with the 31st day after the day on which the notice is given, and
ends immediately before the day on which a notice under paragraph 8(2) or 9(2) of Schedule 43A, or a notice under paragraph 8(2) of Schedule 43B, is given in relation to the tax arrangements (as the case may be).
In this section “GAAR-related adjustments” means—
for the purposes of subsection (8), adjustments which give effect (wholly or in part) to the proposed counteraction set out in the notice under paragraph 3 of Schedule 43 or paragraph 5 of Schedule 43D.;
for the purposes of subsection (9), adjustments which give effect (wholly or partly) to the proposed counteraction set out in the notice of pooling or binding (as the case may be).
This section applies where—
the counteraction of a tax advantage under section 209 is final, and
if the case is not one in which notice of the counteraction was given under paragraph 12 of Schedule 43, paragraph 8 or 9 of Schedule 43A or paragraph 8 of Schedule 43B, HMRC have been notified of the counteraction ....
A person has 12 months, beginning with the day on which the counteraction becomes final, to make a claim for one or more consequential adjustments to be made in respect of any tax to which the general anti-abuse rule applies.
On a claim under this section, an officer of Revenue and Customs must make such of the consequential adjustments claimed (if any) as are just and reasonable.
Consequential adjustments—
may be made in respect of any period, and
may affect any person (whether or not a party to the tax arrangements).
But nothing in this section requires or permits an officer to make a consequential adjustment the effect of which is to increase a person's liability to any tax.
For the purposes of this section—
if the claim relates to income tax or capital gains tax, Schedule 1A to TMA 1970 applies to it;
if the claim relates to corporation tax, Schedule 1A to TMA 1970 (and not Schedule 18 to FA 1998) applies to it;
if the claim relates to petroleum revenue tax, Schedule 1A to TMA 1970 applies to it, but as if the reference in paragraph 2A(4) of that Schedule to a year of assessment included a reference to a chargeable period within the meaning of OTA 1975 (see section 1(3) and (4) of that Act);
if the claim relates to inheritance tax it must be made in writing to HMRC and section 221 of IHTA 1984 applies as if the claim were a claim under that Act;
if the claim relates to stamp duty land tax or annual tax on enveloped dwellings, Schedule 11A to FA 2003 applies to it as if it were a claim to which paragraph 1 of that Schedule applies.
Where an officer of Revenue and Customs makes a consequential adjustment under this section, the officer must give the person who made the claim written notice describing the adjustment which has been made.
For the purposes of this section the counteraction of a tax advantage is final when the adjustments made to effect the counteraction, and any amounts arising as a result of those adjustments, can no longer be varied, on appeal or otherwise.
Any adjustments required to be made under this section may be made—
by way of an assessment, the modification of an assessment, the amendment of a claim, or otherwise, and
despite any time limit imposed by or under any enactment other than this Part.
For the purposes of subsection (1)(b), HMRC must be notified—
in a case where Schedule 43D applies, by the responsible partner (within the meaning of that Schedule), and
in any other case, by the person to whom the tax advantage would have arisen.
An officer of Revenue and Customs may give a written notice (a “protective GAAR notice”) to a person stating that the officer considers—
that a tax advantage might have arisen to the person from tax arrangements that are abusive, and
that, on the assumption that the advantage does arise from tax arrangements that are abusive, it ought to be counteracted under section 209.
The protective GAAR notice must be given within the ordinary assessing time limit applicable to the proposed adjustments.
But if— the protective GAAR notice must instead be given no later than the time when the enquiry is completed.
a tax enquiry is in progress into a return made by the person, and
the return relates to the tax in respect of which the specified adjustments under the protective GAAR notice are made,
The protective GAAR notice must—
specify the arrangements and the tax advantage, and
specify the adjustments that, on the assumption that the advantage does arise from tax arrangements that are abusive, the officer proposes ought to be made.
The adjustments specified in the protective GAAR notice have effect as if they are made by virtue of section 209.
Notice of appeal may be given against the adjustments specified in the protective GAAR notice (whether or not the adjustments are also made otherwise than by virtue of section 209).
Any appeal against the specified adjustments (whether made by virtue of section 209 or otherwise) is, as a result of this subsection, stayed—
for a period of 12 months beginning with the day on which the protective GAAR notice is given, or
if a final GAAR counteraction notice is given before the end of that period, for a period ending with the day on which the final GAAR counteraction notice is given.
If, in the case of the specified adjustments (whether made by virtue of section 209 or otherwise)— the protective GAAR notice has effect for all purposes (other than the purposes of section 212A) as if it had been given as a final GAAR counteraction notice (and, accordingly, as if the GAAR procedural requirements had been complied with).
notice of appeal is not given or notice of appeal is given but the appeal is subsequently withdrawn or determined by agreement, and
no final GAAR counteraction notice is given,
In any case not falling within subsection (8)—
the specified adjustments have no effect (so far as they are made by virtue of section 209) unless they (or lesser adjustments) are subsequently specified in a final GAAR counteraction notice, but
the giving of the protective GAAR notice is treated as meeting the requirements of section 209(6)(b) in the case of that final GAAR counteraction notice.
This section applies in the case of any particular adjustments in respect of a particular period or matter (“the adjustments concerned”) if—
a person is given a notice under paragraph 3 of Schedule 43 or a pooling notice or notice of binding under Schedule 43A (“the Schedule 43 or 43A notice”) that specifies the adjustments concerned (whether or not other adjustments are specified),
the Schedule 43 or 43A notice is given within the relevant time limit applicable to the adjustments concerned, and
the adjustments concerned have not been specified in a provisional counteraction notice under section 209A, or a protective GAAR notice under section 209AA, given before the time at which the Schedule 43 or 43A notice is given.
The Schedule 43 or 43A notice is given within the relevant time limit if—
it is given within the ordinary assessing time limit applicable to the adjustments concerned, or
if a tax enquiry is in progress into a return made by the person and the particular adjustments concerned relate to the matters contained in the return, it is given no later than the time when the enquiry is completed.
The adjustments concerned have effect as if they are made by virtue of section 209.
If, in the case of the specified adjustments (whether made by virtue of section 209 or otherwise)— the Schedule 43 or 43A notice has effect for all purposes (other than the purposes of section 212A) as if it had been given as a final GAAR counteraction notice (and, accordingly, as if the GAAR procedural requirements had been complied with).
notice of appeal is not given or notice of appeal is given but the appeal is subsequently withdrawn or determined by agreement, and
no final GAAR counteraction notice is given,
In any case not falling within subsection (4)—
the adjustments concerned have no effect (so far as they are made by virtue of section 209) unless they (or lesser adjustments) are subsequently specified in a final GAAR counteraction notice, but
the giving of the Schedule 43 or 43A notice is treated as meeting the requirements of section 209(6)(b) in the case of that final GAAR counteraction notice.
In proceedings before a court or tribunal in connection with the general anti-abuse rule, HMRC must show—
that there are tax arrangements that are abusive, and
that the adjustments made to counteract the tax advantages arising from the arrangements are just and reasonable.
In determining any issue in connection with the general anti-abuse rule, a court or tribunal must take into account—
HMRC's guidance about the general anti-abuse rule that was approved by the GAAR Advisory Panel at the time the tax arrangements were entered into, and
any opinion of the GAAR Advisory Panel given—
under paragraph 11 of Schedule 43 about the arrangements or any tax arrangements which are, as a result of a notice under paragraph 1 or 2 of Schedule 43A, the referred or (as the case may be) counteracted arrangements in relation to the arrangements, or
under paragraph 6 of Schedule 43B in respect of a generic referral of the arrangements.
In determining any issue in connection with the general anti-abuse rule, a court or tribunal may take into account—
guidance, statements or other material (whether of HMRC, a Minister of the Crown or anyone else) that was in the public domain at the time the arrangements were entered into, and
evidence of established practice at that time.
Any priority rule has effect subject to the general anti-abuse rule (despite the terms of the priority rule).
A “priority rule” means a rule (however expressed) to the effect that particular provisions have effect to the exclusion of, or otherwise in priority to, anything else.
Examples of priority rules are—
the rule in section 464, 699 or 906 of CTA 2009 (priority of loan relationships rules, derivative contracts rules and intangible fixed assets rules for corporation tax purposes), and
the rule in section 6(1) of TIOPA 2010 (effect to be given to double taxation arrangements despite anything in any enactment).
This section applies in the case of any particular adjustments in respect of a particular period or matter (“the adjustments concerned”) if, in relation to a partnership—
the responsible partner is given a notice under paragraph 5 or 10 of Schedule 43D (“the Schedule 43D notice”) that specifies the adjustments concerned (whether or not other adjustments are specified),
the Schedule 43D notice is given within the relevant time limit applicable to the adjustments concerned, and
the adjustments concerned have not been specified in a protective GAAR notice given before the time at which the Schedule 43D notice is given.
The Schedule 43D notice is given within the relevant time limit if—
it is given within the ordinary assessing time limit applicable to the adjustments concerned, or
in a case where a tax enquiry is in progress into a partnership return made by the responsible partner and the particular adjustments concerned relate to the matters contained in the return, it is given no later than the time when the enquiry is completed.
The adjustments concerned have effect as if they are made by virtue of section 209.
If, in the case of the specified adjustments (whether made by virtue of section 209 or otherwise)— the Schedule 43D notice has effect for all purposes (other than the purposes of section 212B) as if it had been given as a final GAAR counteraction notice (and, accordingly, as if the GAAR procedural requirements had been complied with).
notice of appeal is not given or notice of appeal is given but the appeal is subsequently withdrawn or determined by agreement, and
no final GAAR counteraction notice is given,
In any case not falling within subsection (4)—
the adjustments concerned have no effect (so far as they are made by virtue of section 209) unless they (or lesser adjustments) are subsequently specified in a final GAAR counteraction notice, but
the giving of the Schedule 43D notice is treated as meeting the requirements of section 209(6)(b) in the case of that final GAAR counteraction notice.
In subsection (1) “protective GAAR notice” means a protective GAAR notice given under section 209AA or paragraph 4 of Schedule 43D.
In this section “the responsible partner” and “partnership return” have the same meaning as in Schedule 43D.
In sections 209AA to 209ABA—
Expressions which are used in section 202 of FA 2014 (“tax enquiry”, and its being “in progress”, and “return”) have the same meaning in sections 209AA to 209ABA as they have in that section (and references to completing a tax enquiry are to be read accordingly).
Section 42 of TMA 1970 (procedure for making claims etc) is amended as follows.
In subsection (2), for “(3ZB)” substitute “ (3ZC) ”.
After subsection (3ZB) insert—
In this Part—
In this Part references to any “opinion of the GAAR Advisory Panel” about any tax arrangements are to be interpreted in accordance with paragraph 11(5) of Schedule 43.
In this Part references to tax arrangements which are “equivalent” to one another are to be interpreted in accordance with paragraph 11 of Schedule 43A.
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The general anti-abuse rule has effect in relation to any tax arrangements entered into on or after the day on which this Act is passed.
Where the tax arrangements form part of any other arrangements entered into before that day those other arrangements are to be ignored for the purposes of section 207(3), subject to subsection (3).
Account is to be taken of those other arrangements for the purposes of section 207(3) if, as a result, the tax arrangements would not be abusive.
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A person (P) is liable to pay a penalty if—
P has been given a notice under— stating that a tax advantage arising from particular tax arrangements is to be counteracted,
paragraph 12 of Schedule 43,
paragraph 8 or 9 of Schedule 43A, or
paragraph 8 of Schedule 43B,
a tax document has been given to HMRC on the basis that the tax advantage arises to P from those arrangements,
that document was given to HMRC—
by P, or
by another person in circumstances where P knew, or ought to have known, that the other person gave the document on the basis mentioned in paragraph (b), and
the tax advantage has been counteracted by the making of adjustments under section 209.
The penalty is 60% of the value of the counteracted advantage.
Schedule 43C—
gives the meaning of “the value of the counteracted advantage”, and
makes other provision in relation to penalties under this section.
In this section “tax document” means any return, claim or other document submitted in compliance (or purported compliance) with any provision of, or made under, an Act.
In this section the reference to giving a tax document to HMRC is to be interpreted in accordance with paragraph 11(g) and (h) of Schedule 43C.
This section applies if, in respect of a partnership—
the responsible partner has been given a notice under— stating that a tax advantage is to be counteracted, and
paragraph 12 of Schedule 43,
paragraph 8 or 9 of Schedule 43A, or
paragraph 8 of Schedule 43B,
the tax advantage, so far as arising to a partner (P) in the partnership, has been counteracted by the making of adjustments under section 209.
P is liable to pay a penalty of an amount equal to 60% of the value of the counteracted tax advantage.
Schedule 43C—
gives the meaning of “the value of the counteracted tax advantage”, and
makes other provision in relation to penalties under this section.
For the meaning of “the responsible partner” see paragraph 2 of Schedule 43D.
Schedule 44 contains provision about trusts which have a vulnerable beneficiary.
The Treasury may by regulations make provision about the treatment of the trustees or unit holders of unauthorised unit trusts for the purposes of income tax, corporation tax, capital gains tax or stamp duty land tax.
Regulations under this section may— In paragraph (b) “modify” includes amend, repeal or revoke.
confer or impose powers or duties on officers of Revenue and Customs or other persons;
modify any enactment or instrument (whenever passed or made);
specify descriptions of unauthorised unit trust in relation to which the regulations are to apply or are not to apply;
make different provision for different cases or different purposes;
make incidental, consequential, supplementary and transitional provision and savings.
The statutory instrument containing the first regulations under this section may not be made unless a draft has been laid before and approved by a resolution of the House of Commons.
A subsequent statutory instrument containing regulations under this section is subject to annulment in pursuance of a resolution of the House of Commons.
In this section—
“unauthorised unit trust” means a unit trust scheme which is neither an authorised unit trust nor an umbrella scheme,
“unit trust scheme” has the meaning given by section 237 of the Financial Services and Markets Act 2000, and
“authorised unit trust”, “umbrella scheme” and “unit holder” have the same meaning as in Chapter 2 of Part 13 of CTA 2010 (authorised investment funds).
Schedule 45 contains—
provision for determining whether individuals are resident in the United Kingdom for the purposes of income tax, capital gains tax and (where relevant) inheritance tax and corporation tax,
provision about split years, and
provision about periods when individuals are temporarily non-resident.
The Treasury may by order make any incidental, supplemental, consequential, transitional or saving provision in consequence of Schedule 45.
An order under subsection (2) may—
make different provision for different purposes, and
make provision amending, repealing or revoking any provision made by or under an Act (whenever passed or made).
An order under subsection (2) is to be made by statutory instrument.
A statutory instrument containing an order under subsection (2) is subject to annulment in pursuance of a resolution of the House of Commons.
Schedule 46 contains provision removing or replacing rules relating to ordinary residence.
The Treasury may by order make further provision removing or replacing rules relating to ordinary residence with respect to—
income tax,
capital gains tax, and
(so far as the ordinary residence status of individuals is relevant to them) inheritance tax and corporation tax.
An order under subsection (2) may take effect from the start of the tax year in which the order is made.
The Treasury may by order make any incidental, supplemental, consequential, transitional or saving provision in consequence of Schedule 46 or in consequence of any further provision made under subsection (2).
An order under this section may—
make different provision for different purposes, and
make provision amending, repealing or revoking any provision made by or under an Act (whenever passed or made).
An order under this section is to be made by statutory instrument.
A statutory instrument containing an order under subsection (2) (whether alone or with other provisions) may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, the House of Commons.
Subject to subsection (7), a statutory instrument containing an order under this section is subject to annulment in pursuance of a resolution of the House of Commons.
Schedule 47 makes provision in relation to CFCs etc.
In Schedule 36 to FA 2012 (agreement between UK and Switzerland), after paragraph 26 insert—
The amendment made by this section is to be treated as having come into force on 1 January 2013.
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The Treasury may make regulations for, or in connection with, giving effect to or enabling effect to be given to—
the agreement reached between the Government of the United Kingdom and the Government of the United States of America to improve international tax compliance and to implement FATCA, signed on 12 September 2012;
any agreement modifying or supplementing that agreement;
any other agreement between the Government of the United Kingdom and the government of another territory which makes provision corresponding, or substantially similar, to that made by an agreement within paragraph (a) or (b);
any arrangements for the exchange of tax information in relation to the United Kingdom and any other territory which make provision corresponding, or substantially similar, to that made by an agreement within paragraph (a) or (b).
Regulations under this section may in particular—
authorise HMRC to require persons specified for the purposes of this paragraph (“relevant financial entities”) to provide HMRC with information of specified descriptions;
require that information to be provided at such times and in such form and manner as may be specified;
impose obligations on relevant financial entities (including obligations to obtain from specified persons details of their place of residence for tax purposes);
make provision (including provision imposing penalties) about contravention of, or non-compliance with, the regulations;
make provision about appeals in relation to the imposition of any penalty.
Regulations under this section may—
provide that a reference in the regulations to an agreement or arrangements to which subsection (1) refers, or a provision of such an agreement or arrangements, is to be construed as a reference to the agreement or arrangements, or provision, as amended from time to time;
make different provision in relation to different periods of time;
make different provision for different cases or circumstances;
contain incidental, supplemental, transitional, transitory or saving provision (including provision amending any enactment).
In this section—
“the UK sector of a cross-boundary field” means that part of a cross-boundary field lying within the UK marine area (as defined by section 42 of the Marine and Coastal Access Act 2009), and
In section 524 (no charge in respect of exercise of option) in subsection (2C) omit the definition of “retirement” and the “and” before it.
In section 498 (no charge on shares ceasing to be subject to plan in certain circumstances) after subsection (2) insert—
In paragraph 63 (requirements to be met as regards cash dividends) in sub-paragraph (1) omit the entry for paragraph 64.
Schedule 18 to FA 1998 (company tax returns, assessments and related matters) is amended as follows.
Part 7 of CTA 2010 (community investment tax relief) is amended as follows.
In section 417 of ITTOIA 2005 (person liable for charge on release of loan or advance), for subsection (1) substitute— The amendment made by this paragraph has effect in relation to loans or advances made on or after 20 March 2013.
In this Part “the GAAR Advisory Panel” means the panel of persons established by the Commissioners for the purposes of the general anti-abuse rule. In this Schedule “the Chair” means any member of the GAAR Advisory Panel appointed by the Commissioners to chair it.
In this Schedule, “relevant settlement” means— In this Schedule a reference to a will includes a reference to a codicil.
TMA 1970 is amended in accordance with paragraphs 2 to 6.
After section 59F insert—
In Part 8 of Schedule 4 (supplementary provisions) omit paragraph 35A (retirement age).
For the purposes of sub-paragraph (5) it does not matter if the general offer is made to different shareholders by different means. If in the case of a takeover offer (as defined in section 974 of the Companies Act 2006) there arises a right under section 983 of that Act to require the offeror to acquire the participant's free shares, or such of them as are of a particular class, the participant may direct the trustees to exercise that right. A SIP approved before the day on which this Act is passed has effect with any modifications needed to reflect the amendment made by this paragraph.
Omit paragraph 64 (limit on amount reinvested).
In paragraph 10(2) (other claims and elections to be included in return), after “first-year tax credits” insert “ , R&D expenditure credits ”.
Section 220 (form and amount of CITR) is amended as follows. For subsection (3) substitute— In subsection (4) for “this purpose” substitute “ the purposes of this section and section 220A ”.
The amendments made by paragraphs 87 and 88 above have effect in relation to the tax year 2013-14 and subsequent tax years. A SIP approved before 6 April 2013 has effect accordingly with the omission of any provision falling within a provision of Schedule 2 to ITEPA 2003 omitted by paragraph 88 above.
Paragraph 52 (recovery of excessive repayments etc) is amended as follows. In sub-paragraph (2), after paragraph (b) insert—. In sub-paragraph (5)—
After section 220 insert—
Immediately before section 59G insert—.
Section 109B (provision for securing payment by company of outstanding tax) is amended as follows. In subsection (1), at the end insert “, subject to subsection (5A).” In subsection (4)(b), at the end insert “(which may include a proposal to enter into an exit charge payment plan in accordance with Schedule 3ZB).” After subsection (5) insert—
Part 9A (claims for R&D tax relief) is amended as follows. In paragraph 83A (introduction), for the words after “applies” substituteto— In paragraph 83C (content of claim), before “relief” insert “ credit or ”. Accordingly, the heading of the Part becomes “ CLAIMS FOR R&D EXPENDITURE CREDITS OR R&D TAX RELIEF ”.
In section 240 (attribution of CITR) after subsection (4) insert—
Section 244 (disposal of securities or shares during 5 year period) is amended as follows. For subsection (3) substitute— Omit subsections (5) to (7).
Section 109E (liability of other persons for unpaid tax) is amended as follows. After subsection (1) insert— In subsection (2), for “the time when the amount of the tax is finally determined” substitute “the relevant time”. After subsection (2) insert—
After Schedule 3ZA insert—
The amendments made by paragraphs 7 to 11 above have effect in relation to investments made in accounting periods beginning on or after 1 April 2013.
The power conferred by this section is without prejudice to any other powers conferred by or under any enactment.
The power of the Treasury to make regulations under this section is exercisable by statutory instrument.
Any statutory instrument containing regulations under this section is subject to annulment in pursuance of a resolution of the House of Commons.
Part 7 of FA 2004 (disclosure of tax avoidance schemes) is amended in accordance with subsections (2) and (3).
After section 312A insert—
After section 313ZA insert—
In section 98C(2) of TMA 1970 (notification under Part 7 of FA 2004)—
after paragraph (da) insert—, and
after paragraph (db) insert—.
Schedule 48 makes provision for, and in connection with, conferring powers under Chapter 3 of Part 5 and Chapters 2 and 3 of Part 8 of the Proceeds of Crime Act 2002 on officers of Revenue and Customs.
In section 1(1) of CEMA 1979 (interpretation), in the definition of “goods”, for “baggage” substitute “ containers ”.
Section 139 of CEMA 1979 (provisions as to detention, seizure and condemnation of goods etc) is amended as follows.
After subsection (1) insert—
In subsection (2), for the words from “either” to the end substitute “ deliver that thing to an officer ”.
In subsection (4), for “the Commissioners at the nearest office of customs and excise” substitute “ an officer ”.
In subsection (5), for “Schedule 3” substitute “ Schedules 2A and 3 ”.
After that subsection insert—
After Schedule 2 to that Act (composite goods: supplementary provisions as to excise duties and drawbacks) insert—
The amendments made by this section have effect in relation to things detained on or after the day on which this Act is passed.
Section 143 of CEMA 1979 (penalty in lieu of forfeiture of larger ship where responsible officer is implicated in offence) is amended as follows.
For subsection (1) (Commissioners' power to impose fine up to £50) substitute—
In subsection (3) (Commissioners' power to bring condemnation proceedings)—
for the words from the beginning to the first “they” substitute “ The Commissioners ”, and
for “£500” substitute “ £10,000 ”.
In subsection (4) (power to detain ship pending payment of deposit against fine or condemnation proceedings)—
for the words from the beginning to “section, the” substitute “ The ”,
for “£50 or, as the case may be, £500” substitute “ £10,000 ”, and
omit “their final decision or, as the case may be,”.
In paragraph (a) of subsection (6) (definition of “responsible officer)—
after “means” insert “ a person who is, or is acting as, ”,
for “or an engineer” substitute “ , an engineer or the bosun ”, and
omit the words from “and, in the case of a ship manned” to the end.
After that subsection insert—
In Part 2 of Schedule 23 to FA 2011 (data-gathering powers: relevant data-holders), after paragraph 13 insert—
This section applies in relation to relevant data with a bearing on any period (whether before, on or after the day on which this Act is passed).
Schedule 49 contains provision for, and in connection with, deferring the payment by a company of certain corporation tax in circumstances where income, profits or gains arise by virtue of section 25, 185 or 187(4) of TCGA 1992 or section 162, 333, 334, 609, 610, 859 or 862 of CTA 2009.
Schedule 50 contains provision for, and in connection with, penalties for late filing, late payment and errors.
Cases G and H do not apply where the amount paid, or liable to be paid, is tax which has been charged contrary to EU law. For the purposes of sub-paragraph (9A), an amount of tax is charged contrary to EU law if, in the circumstances in question, the charge to tax is contrary to—
Case G does not apply where the amount paid, or liable to be paid, is tax which has been charged contrary to EU law. For the purposes of sub-paragraph (9), an amount of tax is charged contrary to EU law if, in the circumstances in question, the charge to tax is contrary to—
Case G does not apply where the amount paid, or liable to be paid, is tax which has been charged contrary to EU law. For the purposes of sub-paragraph (9), an amount of tax is charged contrary to EU law if, in the circumstances in question, the charge to tax is contrary to—
Case G does not apply where the amount paid, or liable to be paid, is tax which has been charged contrary to EU law. For the purposes of sub-paragraph (9), an amount of tax is charged contrary to EU law if, in the circumstances in question, the charge to tax is contrary to—
The amendments made by this section have effect in relation to any claim (in respect of overpaid tax, excessive assessment etc) made after the end of the six month period beginning with the day on which this Act is passed.
In Schedule 1AB to TMA 1970 (recovery of overpaid tax etc), in paragraph 3 (making a claim), in sub-paragraph (3) after “the relevant tax year is” insert— .
In Schedule 2 to OTA 1975, in paragraph 13C (claim for relief for overpaid tax etc: making a claim), in sub-paragraph (3) after “the relevant chargeable period is” insert— .
In Part 6 of Schedule 18 to FA 1998 (overpaid tax, excessive assessments or repayments, etc), in paragraph 51B (making a claim), in sub-paragraph (3), after “the relevant accounting period is” insert— .
The amendments made by this section have effect in relation to any claim (in respect of overpaid tax, excessive assessment etc) made after the end of the six month period beginning with the day on which this Act is passed.
Schedule 51 contains provision for, and in connection with, withdrawing a notice under section 8, 8A or 12AA of TMA 1970 and cancelling liability to a penalty under Schedule 55 to FA 2009.
This section applies to an application for an interim remedy (however described), made in any court proceedings relating to a taxation matter, if the application is founded (wholly or in part) on a point of law which has yet to be finally determined in the proceedings.
Any power of a court to grant an interim remedy (however described) requiring the Commissioners for Her Majesty's Revenue and Customs, or an officer of Revenue and Customs, to pay any sum to any claimant (however described) in the proceedings is restricted as follows.
The court may grant the interim remedy only if it is shown to the satisfaction of the court—
that, taking account of all sources of funding (including borrowing) reasonably likely to be available to fund the proceedings, the payment of the sum is necessary to enable the proceedings to continue, or
that the circumstances of the claimant are exceptional and such that the granting of the remedy is necessary in the interests of justice.
The powers restricted by this section include (for example)—
powers under rule 25 of the Civil Procedure Rules 1998 (S.I. 1998/3132);
powers under Part II of Rule 29 of the Rules of the Court of Judicature (Northern Ireland) (Revision) 1980 (S.R. 1980 No.346).
This section applies in relation to proceedings whenever commenced, but only in relation to applications made in those proceedings on or after 26 June 2013.
This section applies on and after 26 June 2013.
Subsection (8) applies where, on or after 26 June 2013 but before the passing of this Act, an interim remedy was granted by a court using a power which, because of subsection (6), is to be taken to have been restricted by this section.
Unless it is shown to the satisfaction of the court that paragraph (a) or (b) of subsection (3) applied at the time the interim remedy was granted, the court must, on an application made to it under this subsection—
revoke or modify the interim remedy so as to secure compliance with this section, and
if the Commissioners have, or an officer of Revenue and Customs has, paid any sum as originally required by the interim remedy, order the repayment of the sum or any part of the sum as appropriate (with interest from the date of payment).
For the purposes of this section, proceedings on appeal are to be treated as part of the original proceedings from which the appeal lies.
In this section “taxation matter” means anything, other than national insurance contributions, the collection and management of which is the responsibility of the Commissioners for Her Majesty's Revenue and Customs (or was the responsibility of the Commissioners of Inland Revenue or Commissioners of Customs and Excise).
In this Act—
“the Glasgow Commonwealth Games” means the Commonwealth Games held in Scotland in 2014;
This paragraph applies in relation to a chargeable period which begins before 1 January 2013 and ends on or after that date but not later than the specified date (“the first straddling period”). The specified date” means— The maximum allowance under section 51A of CAA 2001 for the first straddling period is the sum of each maximum allowance that would be found if— were each treated as separate chargeable periods. But this is subject to paragraphs 2 and 3. In this Schedule “the relevant date” means—
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Part 7 of ITEPA 2003 (employment income: income and exemptions relating to securities) is amended as follows.
After Part 14 of CTA 2010 insert—
Part 13 of CTA 2009 (additional relief for expenditure on research and development) is amended as follows.
TCGA 1992 is amended as follows.
FA 2008 is amended as follows. In Schedule 12 (tax credit for certain foreign distributions), omit paragraphs 26, 27(2)(a) and (c) and (3), 28(2)(a) and (c) and (3), 29(2)(a), (c)(i) and (d) and (3) and 30. In Schedule 23 (manufactured payments: anti avoidance), omit paragraphs 1 to 4, 6, 7 and 9 to 11.
CTA 2010 is amended as follows.
FA 2012 is amended as follows. Omit section 22 (treatment of the receipt of manufactured overseas dividends). In section 78(3) (amounts which are deemed BLAGAB management expense for accounting period), for “783(6), 785(4) or 791(6)” substitute “ 814C(7) ”. In Schedule 16 (minor and consequential amendments), omit paragraphs 220 to 223.
A person who is required to deliver a return for a chargeable period must— The records must be preserved until the end of the later of the relevant day and the date on which— “The relevant day” means— Different days may be specified for different purposes under sub-paragraph (3)(b). The records required to be kept and preserved under this paragraph include— The Commissioners for Her Majesty’s Revenue and Customs may by regulations— Regulations under this paragraph may make provision by reference to things specified in a notice published by the Commissioners for Her Majesty’s Revenue and Customs in accordance with the regulations (and not withdrawn by a subsequent notice). “Supporting documents” includes accounts, books, deeds, contracts, vouchers and receipts.
If at a time when an enquiry is in progress into a return an officer of Revenue and Customs forms the opinion— the officer may by notice in writing to the relevant person amend the assessment to make good the deficiency. If the enquiry is one that is limited by paragraph 9(2) and (3) 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—
While proceedings on a referral under paragraph 11 are in progress in relation to an enquiry— Proceedings on a referral are “in progress” where— A question referred has been “finally determined” when—
An enquiry under paragraph 8 is completed when an officer of Revenue and Customs informs the relevant person by a notice (a “closure notice”) that the enquiry is complete and states the conclusions reached in the enquiry. A closure notice must either— A closure notice takes effect when it is issued.
A determination under paragraph 18 has effect for enforcement purposes as if it were a self assessment made by P. In sub-paragraph (1) “for enforcement purposes” means for the purposes of section 165 and Schedule 12 to FA 2003 (collection and recovery of tax etc). Nothing in this paragraph affects any liability of a person to a penalty for failure to deliver a return.
If an amount of tax has been, but ought not to have been, repaid to a person that amount may be assessed and recovered as if it were unpaid tax. If the repayment was made with interest, the amount assessed and recovered may include the amount of interest that ought not to have been paid.
The general rule is that no assessment may be made more than 4 years after the end of the chargeable period to which the assessment relates. An assessment of a person to tax in a case involving a loss of tax brought about carelessly by the taxpayer or a related person may be made up to 6 years after the end of the chargeable period to which the assessment relates. An assessment to which this sub-paragraph applies may be made up to 20 years after the end of the chargeable period to which the assessment relates. Sub-paragraph (3) applies to an assessment of a person in any case involving a loss of tax— An assessment under paragraph 22 (assessment to recover excessive repayment of tax) is not out of time if it is made— In sub-paragraph (5)— If the taxpayer has died— Any objection to the making of an assessment on the ground that the time limit for making it has expired can only be made on an appeal against the assessment. In this paragraph “related person”, in relation to the taxpayer, means—
The Commissioners for Her Majesty’s Revenue and Customs are not liable to give effect to a claim under paragraph 29 if or to the extent that the claim falls within a case described in this paragraph. Case A is where the amount of tax paid, or liable to be paid, is excessive because of— Case B is where the claimant is or will be able to seek relief by taking other steps under this Part of this Act. Case C is where the claimant— Case D is where the claim is made on grounds that— Case E is where the claimant knew, or ought reasonably to have known, of the grounds for the claim before the latest of the following— In this sub-paragraph “relevant appeal” means an appeal by the claimant relating to the amount paid or liable to be paid. Case F is where the amount in question was paid or is liable to be paid— Case G is where— Case G does not apply where the amount paid, or liable to be paid, is tax which has been charged contrary to EU law. For the purposes of sub-paragraph (9), an amount of tax is charged contrary to EU law if, in the circumstances in question, the charge to tax is contrary to—
This paragraph applies where— In a case falling within paragraph 32(1)(a) or (b), the reference to the claimant in sub-paragraph (1)(b) of this paragraph includes any relevant person (as defined in paragraph 32(3)). The following are relevant restrictions— Where this paragraph applies— A claim is not finally determined until it, or the amount to which it relates, can no longer be varied (whether on appeal or otherwise).
Notice of an appeal under paragraph 35 must be given— In sub-paragraph (1) “specified date” means— The notice of appeal must specify the grounds of appeal. Where a determination has been made under paragraph 18 as to the amount of tax to which a person is chargeable with respect to a single-dwelling interest, the only grounds on which an appeal lies under paragraph 35(1)(c) are—
If the appellant notifies HMRC that it requires them to review the matter in question, HMRC must— Sub-paragraph (1) does not apply if— In this paragraph “the relevant period” means—
If HMRC give notice of the conclusions of a review (see paragraph 41)— Sub-paragraph (1) does not apply to the matter in question if, or to the extent that, the appellant notifies the appeal to the tribunal (see paragraphs 43 and 44).
In paragraphs 38 to 44— In paragraphs 38 to 44, a reference to the appellant includes a person acting on behalf of the appellant except in relation to— But if a notification falling within any of the paragraphs of sub-paragraph (2) is given to the appellant, a copy of the notification may also be given to a person acting on behalf of the appellant.
If the appellant has grounds for believing that the amendment or assessment overcharges the appellant to tax, or as a result of the conclusion stated in the closure notice the tax charged on the appellant is excessive, the appellant may— An application under sub-paragraph (1)(a) must state the amount believed to be overcharged to tax and the grounds for that belief. 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 it is overcharged to tax by the decision appealed against. If, after an application under sub-paragraph (1) has been determined, there is a change in the circumstances of the case as a result of which either party has grounds for believing that the amount determined has become either excessive or insufficient, that party may (if the parties cannot agree on a revised determination) apply to the tribunal for a revised determination of that amount. An application under sub-paragraph (4) may be made at any time before the determination of the appeal. An application under this paragraph is to be subject to the relevant provisions of Part 5 of the Taxes Management Act 1970 (see, in particular, section 48(2)(b) of that Act). 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 that there are reasonable grounds for believing that the appellant is overcharged. Where an application under this paragraph has been determined, section 163 has effect in relation to any tax of which payment is not postponed as if— In this paragraph “specified date” has the meaning given by paragraph 36.
The determination of the tribunal in relation to any proceedings under this Part of this Schedule is to be final and conclusive except as otherwise provided in—
sections 9 to 14 of the Tribunals, Courts and Enforcement Act 2007, or
this Part of this Act.
In this Part of this Schedule “the tribunal” means— Sub-paragraph (1) does not apply so far as sub-paragraph (3) requires otherwise. Where the question in any dispute on any appeal under paragraph 35(1) is of the market value of any single-dwelling interest, that question is to be determined on a reference by—
The automatic residence test is met for year X if P meets—
at least one of the automatic UK tests, and
none of the automatic overseas tests.
Any reference to a number of days spent in the UK “in” a given period is a reference to the total number of days spent there (in aggregate) in that period, whether continuously or intermittently.
Work is done where it is actually done, regardless of where the employment is held or the trade is carried on by P. But work done by way of or in the course of travelling to or from the UK by air or sea or via a tunnel under the sea is assumed to be done overseas even during the part of the journey in or over the UK. For these purposes, travelling to or from the UK is taken to— This paragraph is subject to express provisions in this Schedule about the location of work done by people with relevant jobs on board vehicles, aircraft or ships.
P has a “relevant” job on board a vehicle, aircraft or ship if condition A and condition B are met. Condition A is that P either— Condition B is that substantially all of the trips made in performing those duties or carrying on those activities are ones that involve crossing an international boundary at sea, in the air or on land (referred to as “cross-border trips”). Sub-paragraph (2)(b) is not satisfied unless, in order to do the work or provide the services, P has to be present (in person) on board the vehicle, aircraft or ship while it is travelling. Duties or activities of a purely incidental nature are to be ignored in deciding whether the duties of an employment or the activities of a trade consist of duties or activities of a kind described in sub-paragraph (2)(a) or (b).
ITTOIA 2005 is amended as follows.
This paragraph applies to an individual who— The provisions listed in sub-paragraph (3) have effect, in relation to such an individual and a qualifying tax year, as if the amendments made to or with respect to those provisions by this Part of this Schedule had not been made. The provisions are— But, in the case of provisions within paragraph (a) or (b) of sub-paragraph (3), this paragraph applies only if service in the employment in question began before the start of the tax year 2013-14. The meaning of “qualifying tax year” depends on the individual’s residence status— Where, by virtue of this paragraph, it is necessary to determine whether an individual is (or is not) ordinarily resident in the United Kingdom at a time on or after 6 April 2013, the question is to be determined as it would have been in the absence of this Schedule.
TMA 1970 is amended in accordance with paragraphs 2 to 5.
Section 7 (notice of liability to income tax and capital gains tax) is amended as follows. In subsection (1)— After subsection (1) insert— In subsection (2), for the words from “shall have effect” to the end substitute “and subsections (1A) to (1C) have effect as if references to a notice under section 8 were references to a notice under section 8A.”
Section 1039 (overview of Part) is amended as follows. In subsection (3)— Omit subsection (4). In subsection (5)—
In section 263B (stock lending arrangements), for subsection (7) substitute—
In section 1 (overview of Act), in subsection (4)—
omit paragraph (d), and
before paragraph (e) insert—.
In section 154A (certain non-UK residents with interest on 3½% War Loan 1952 Or After), in subsection (1)(a), omit “ordinarily”.
Omit Chapter 3 (relief for SMEs: R&D sub-contracted to SME).
Omit section 263D (gains accruing to persons paying manufactured dividends).
Omit Part 17 (manufactured payments and repos).
In section 459 (transfer of assets abroad), in subsection (2), for “an individual ordinarily UK resident” substitute “a UK resident individual”.
After section 8A insert—
After section 12AA insert—
Omit Chapter 4 (relief for SMEs: subsidised and capped expenditure on R&D).
In section 263F (power to modify repo provisions: non-standard repo cases)—
in subsection (1)—
at the end of paragraph (c) insert “ or ”, and
omit paragraph (d) (and the word “or” at the end of it), and
in subsection (2), omit “or 263D”.
Section 1109(5) (provisions to which section 1109 is subject) is amended as follows. Omit paragraphs (a) to (c) (and the word “and” at the end of paragraph (c)). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
In section 468 (non-UK resident trustees and foreign institutions), for subsection (2) substitute—
Omit Chapter 5 (relief for large companies).
In section 263G (power to modify repo provisions: redemption arrangements)—
in subsection (1), omit paragraph (d) (but not the word “or” at the end of it), and
in subsection (2), omit “or 263D”.
In Schedule 1 (minor and consequential amendments), omit paragraphs 259, 537, 538, 539(b) and (c), 635, 636 and 689(a) and (b)(i).
In section 569 (anti-avoidance: transfer of assets abroad), in subsection (2), for “an individual ordinarily UK resident” substitute “a UK resident individual”.
In section 59B (payment of income and capital gains tax), after subsection (4) insert—
Section 1081 (insurance companies treated as large companies) is amended as follows. In subsection (2), for “Chapters 2 to 5” substitute “ Chapter 2 ”. Omit subsection (3).
In section 263H (sections 263F and 263G: supplementary provisions), in subsection (3)(b) omit “or 263D”.
In Schedule 2 (transitionals and savings), omit Part 17 (manufactured payments and repos).
In section 636 (calculation of undistributed income), in subsection (2)(b), for “, resident and ordinarily resident” substitute “and resident”. The amendment made by this paragraph does not apply in calculating income arising under a settlement in tax years ending before 6 April 2013.
Omit section 1082 (R&D expenditure of group companies).
Section 263I (powers about manufactured overseas dividend) is amended as follows. In subsection (1), for paragraphs (a) and (b) substitute— For subsection (6) substitute—
creditor quasi-repo (in Chapter 5 of Part 17)
In section 648 (income arising under a settlement), in subsection (1)(b), for “, resident and ordinarily resident” substitute “and resident”.
Omit section 1083 (refunds of expenditure treated as income chargeable to tax).
In section 651 (meaning of “UK estate” and “foreign estate”), in subsection (3), omit “or not ordinarily UK resident”.
Section 1084 (artificially inflated claims for relief or tax credit) is amended as follows. In subsection (2)(a), for “Chapters 2 to 5” substitute “ Chapter 2 ”. In subsection (3)(a) and (b), for “Chapters 2 to 5” substitute “ Chapter 2 ”.
In section 664 (the aggregate income of the estate), in subsection (2)(b)(i), omit “who was ordinarily UK resident”.
In section 1119 (meaning of “small or medium-sized enterprise”), in subsection (3), for “Chapters 2 to 5” substitute “ Chapter 2 ”.
Section 715 (interest from FOTRA securities held on trust) is amended as follows. In subsection (1)(b), for “person not ordinarily UK resident” substitute “non-UK resident person”. In subsection (2)— In relation to a FOTRA security issued before 6 April 2013, the amendments made by this paragraph apply only if the security was acquired by the trust on or after that date.
In section 1133 (meaning of “sub-contractor” etc), in subsection (3), omit “section 1072(1)(a),”.
In section 771 (relevant foreign income of consular officers and employees), for subsection (4) substitute— The amendment made by this paragraph does not apply to a person who became a consular officer or employee in the United Kingdom before 6 April 2013.
“Minister of the Crown” includes the Treasury,
Part 3 of Schedule 3 (eligibility of individuals) is amended as follows.
Part 4 of Schedule 2 (types of shares that may be awarded) is amended as follows.
Paragraph 62 (reinvestment of dividends) is amended as follows. In sub-paragraph (1) for the first “all” substitute “ some or all of the ”. After sub-paragraph (1) insert— In sub-paragraph (4) after “may” insert “ modify or ”.
The following amendments are in consequence of the amendments made by paragraphs 2(a) and 3.
In Schedule 14 of FA 2007 (sale and repurchase of securities: minor and consequential amendments), omit paragraphs 22 and 23.
In Schedule 6 of FA 2010 (charities etc), omit paragraph 21(4).
the actual accounting period (in Chapter 5A of Part 14) section 705B(4) the change in ownership (in Chapter 5A of Part 14) section 705A(2) the company (in Chapter 5A of Part 14) section 705A(2) notional accounting periods (in Chapter 5A of Part 14) section 705B(4) shell company (in Chapter 5A of Part 14) section 705A(2)
In section 1(4) of CTA 2010 (overview of Act), after paragraph (a) insert—. In section 432 of that Act (sale of lessors: restriction on relief for certain expenses), after subsection (1) insert— arrangements (in Part 14A) section 730B as a deduction (in Part 14A) section 730B C (in Part 14A) section 730B deductible amount (in Part 14A) section 730B qualifying change (in Part 14A) section 730B the relevant day (in Part 14A) section 730B
Part 8A of CTA 2010 (profits arising from the exploitation of patents etc) is amended as follows.
Chapter 16A of Part 2 of CAA 2001 (avoidance involving allowance buying) is amended as follows.
TMA 1970 is amended as follows.
The amendments made by this Part of this Schedule are treated as having come into force on 26 March 2013.
In Part 6 of TIOPA 2010 (tax arbitrage), in section 236 (deduction schemes involving hybrid entities) for subsection (4) substitute—
In paragraph 9 (introduction) omit the entry for paragraph 11 and the “and” before it.
In paragraph 25 (introduction) in sub-paragraph (1)—
after the entry for paragraph 28 insert “ and ”, and
omit the entry for paragraph 30 and the “and” before it.
In paragraph 68 (reinvestment: amounts to be carried forward) for sub-paragraph (1) substitute—
In section 357CG (adjustments in calculating profits of trade), in subsection (4), after “amounts to be deducted are” insert— .
In section 59E(11)(a) (provision as to when tax is due and payable)—
after “455” insert “ or 464A ”, and
after “loan” insert “ or benefit ”.
The amendments made by paragraph 6(2) and (3) above have effect for the purpose of determining if a supply of gas or electricity is exempt from levy where the gas or electricity is actually supplied on or after 1 April 2013. “Gas” means gas in a gaseous state that is of a kind supplied by a gas utility. Those amendments are to have effect for the purpose of determining if any other supply is exempt from levy where the supply is treated as taking place on or after 1 April 2013. The amendments made by paragraph 8 above have effect for the purpose of determining if a supply of electricity is exempt from levy where the electricity is caused to be consumed on or after 1 April 2013. The amendment made by paragraph 10 above has effect in relation to carbon price support rate commodities which are brought onto, or arrive at, sites on or after 1 April 2013.
Part 9A of TIOPA 2010 (controlled foreign companies) is amended as follows.
Omit paragraphs 11 to 16 (the “no material interest” requirement).
Omit paragraphs 30 to 33 (only certain kinds of restrictions allowed).
In paragraph 69 (cash dividends with no requirement to reinvest) in sub-paragraph (2) for “which” substitute “ so far as they ”.
In section 59F(6)(a) (arrangements for paying tax on behalf of group members)—
after “455” insert “ or 464A ”, and
after “loan” insert “ or benefit ”.
In Chapter 3 (the CFC charge gateway: determining which (if any) of Chapters 4 to 8 applies) in section 371CE (does Chapter 6 apply?) for subsections (4) and (5) substitute—
In Part 9 of Schedule 3 (supplementary provisions) in paragraph 49 (index of defined expressions), in the entry for “close company”, omit “(and see paragraph 11(4))”.
In Part 5 of Schedule 2 (free shares) in paragraph 35 (maximum annual award) omit sub-paragraphs (3) and (4).
A SIP approved before the day on which this Act is passed which contains provision under paragraph 62(1) of Schedule 2 to ITEPA 2003 has effect with any modifications needed to reflect the amendments made by paragraphs 83 to 85 above. Sub-paragraph (3) applies to a direction requiring the reinvestment of cash dividends which is given before that day. For the purposes of paragraph 62(1A) of Schedule 2 to ITEPA 2003 the direction is to be treated as requiring the reinvestment of all the cash dividends, subject to any modification of the direction which is made on or after that day under paragraph 62(4) of that Schedule.
Section 109 (corporation tax on close company in connection with loans to participators etc) is amended as follows. In subsection (1)— For subsection (3) substitute— After subsection (3A) insert— In subsection (4), after “458” insert “ or 464B ”. In subsection (5), after “459” insert “ or 464A and 464B ”. In the heading, after “loans” insert “ or benefits ”.
Chapter 9 (exemptions for profits from qualifying loan relationships) is amended as follows.
The amendments made by paragraphs 39 to 42 above have effect for the purpose of determining whether an individual is eligible to participate in a scheme on the day on which this Act is passed or any later day. A SAYE option scheme approved before the day on which this Act is passed has effect accordingly with the omission of any provision falling within a provision of Schedule 3 to ITEPA 2003 omitted by those paragraphs.
The plan must provide that partnership shares are not to be subject to any provision for forfeiture.
The amendments made by paragraphs 9 to 11 are treated as having come into force on 20 March 2013.
In section 371IB (loans funded out of qualifying resources) after subsection (9) insert—
In Part 7 of Schedule 2 (matching shares) in paragraph 59 (general requirement for matching shares) omit sub-paragraph (2).
Section 371IE (matched interest) is amended as follows. In subsection (1)(d)(ii) after “include” insert “some or all of”. After subsection (7) insert—
In Part 9 of Schedule 2 (trustees) in paragraph 75 (duty to give notice of award of shares etc) in sub-paragraphs (2) and (3) after paragraph (a) insert—.
In Part 10 of Schedule 2 (approval of plans) paragraph 84 (disqualifying events) is amended as follows. In sub-paragraph (3)— In sub-paragraph (4)(b) for “provision for forfeiture” substitute “ restriction ”.
Part 11 of Schedule 2 (supplementary provision) is amended as follows.
In paragraph 92 (determination of market value) for sub-paragraph (2) substitute—
In paragraph 99 (minor definitions) after sub-paragraph (3) insert—
restriction (in relation to shares) paragraph 99(4)
The amendments made by paragraphs 46 to 48 and 50 to 52 above have effect in relation to awards of shares made on or after the day on which this Act is passed. A SIP approved, or a trust instrument made, before that day has effect with any modifications needed to reflect the amendments made by paragraphs 46 to 57 above. In particular, in relation to awards of shares on or after that day, such a SIP has effect with the omission of any provision falling within a provision of Schedule 2 to ITEPA 2003 omitted by paragraph 48 above.
In this Act— “FA”, followed by a year, means the Finance Act of that year; “F(No.2)A”, followed by a year, means the Finance (No. 2) Act of that year.
This Act may be cited as the Finance Act 2013.