Commentary on Montenegro’s Gender Equality Law
Income tax is charged for the tax year 2018-19.
Corporation tax is charged for the financial year 2019.
For the tax year 2018-19 the main rates of income tax are as follows—
the basic rate is 20%;
the higher rate is 40%;
the additional rate is 45%.
For the tax year 2018-19 the default rates of income tax are as follows—
the default basic rate is 20%;
the default higher rate is 40%;
the default additional rate is 45%.
For the tax year 2018-19 the savings rates of income tax are as follows—
the savings basic rate is 20%;
the savings higher rate is 40%;
the savings additional rate is 45%.
Section 21 of ITA 2007 (indexation) does not apply in relation to the starting rate limit for savings for the tax year 2018-19 (so that, under section 12(3) of ITA 2007 as amended by section 4 of FA 2017, that limit remains at £5000 for that tax year).
Chapter 3A of Part 3 of ITA 2007 (transferable tax allowance) is amended as follows.
Section 55B (tax reduction: entitlement) is amended in accordance with subsections (3) to (5).
In subsection (2) (conditions for entitlement to tax reduction)—
for paragraph (a) (individual is spouse or civil partner of maker of election in force under section 55C) substitute—, and
in paragraph (d), for “individual's” substitute “ relinquishing ”.
After subsection (5) insert—
In subsection (6) (reduced personal allowance for transferor)—
after “under subsection (1)” insert “ by reference to an election under section 55C ”, and
for “individual's” substitute “ relinquishing ”.
Section 55C (elections to reduce personal allowance) is amended in accordance with subsections (7) and (8).
In subsection (1)(a) (individual may make election if married or in civil partnership)—
after “the same person” insert “ (“the gaining party”) ”, and
in sub-paragraph (ii), after “when the election is made” insert “ or, where the election is made after the death of one or each of them, when they were last both living ”.
After subsection (4) insert—
Section 55D (procedure for elections under section 55C) is amended in accordance with subsections (10) and (11).
In subsection (3) (elections which are not automatically continued in force for subsequent years), after “is made after the end of the tax year to which it relates” insert “ or is made after the death of either of the spouses or civil partners ”.
In subsection (4) (election may be withdrawn only by individual who made it), after “by whom the election was made” insert “ ; an election made by an individual's personal representatives may not be withdrawn ”.
The amendments made by this section—
are to be treated as having come into force on 29 November 2017,
have effect in relation to elections made on or after that day, and
so have effect even where a relevant death occurred on or before that day.
In section 384 of ITEPA 2003 (which provides that Crown employees cannot be seafarers for the purposes of Chapter 6 of Part 5), in subsection (2) (meaning of Crown employment), before the “and” at the end of paragraph (a) insert—.
In Chapter 8 of Part 4 of ITEPA 2003 (exemptions: special kinds of employees), after section 297C insert—
The amendment made by subsection (1) has effect in relation to payments on or after such date as may be specified in regulations made by the Treasury.
Section 141 of ITEPA 2003 (benefits in kind: appropriate percentage for diesel cars) is amended as follows.
For subsection (1) substitute—
In subsection (2)—
in the words before step 1, for “such a” substitute “ the ”;
in paragraph (a) of step 3, for “3 percentage points” substitute “ 4 percentage points ”.
After subsection (2) insert—
In sections 139(7)(a) and 140(5)(a) of ITEPA 2003 (appropriate percentage), before “diesel” insert “ certain ”.
The amendments made by this section have effect in relation to the tax year 2018-19 and subsequent tax years.
Chapter 3 of Part 6 of ITEPA 2003 (payments, and other benefits, on termination of employment etc) is amended as follows.
In section 413 (exception from charge on termination etc payment where employee's work history includes sufficient foreign service), before subsection (1) insert—
In section 414(1) (reduction of termination etc payment where foreign service insufficient for section 413 exception)—
before paragraph (a) insert—, and
for paragraph (b) substitute—
After section 414A insert—
The amendments made by this section have effect—
where the date of the termination or change in question is, or is after, 6 April 2018, and
the payment, or other benefit, is received after 13 September 2017.
Schedule 1 contains provision about employment income provided through third parties.
Schedule 2 contains provision amending Schedule 12 to F(No.2)A 2017 (trading income provided through third parties: loans etc outstanding on 5 April 2019).
Schedule 3 contains provision about pension schemes.
In Part 5 of ITA 2007 (enterprise investment scheme)—
in section 157 (eligibility for EIS relief), in subsection (1), before paragraph (a) insert—, and
after that section insert—
In Part 5A of ITA 2007 (seed enterprise investment scheme)—
in section 257AA (eligibility for SEIS relief), before paragraph (a) insert—, and
after that section insert—
In Part 6 of ITA 2007 (venture capital trusts)—
in section 286 (qualifying holdings), in subsection (3), before paragraph (za) insert—, and
before section 286A insert—
The amendments made by this section come into force in accordance with provision made by the Treasury by regulations.
Regulations under subsection (4)—
may make different provision for different purposes;
may provide for any of those amendments to have effect in relation to shares, or shares or securities, issued on or after a day that is—
earlier than the day on which the regulations are made, but
not earlier than the day on which this Act is passed.
Nothing in the specified EIS and VCT transitional provisions (see subsection (2)) prevents any shares or other investments constituting relevant investments (within the meaning given by section 173A(3), 280B(4) or 292A(3) of ITA 2007) for the purposes of determining entitlement to— in respect of shares issued or investments made on or after 1 December 2017.
EIS income tax relief,
income tax relief for social investments, or
VCT income tax relief,
The specified EIS and VCT transitional provisions are—
paragraph 8 of Schedule 16 to FA 2007;
paragraph 22 of Schedule 7 to FA 2012;
paragraphs 18 and 19 of Schedule 8 to FA 2012.
In this section—
“income tax relief for social investments” means relief under Part 5B of ITA 2007;
Paragraph 3 (single dwelling transactions: purchaser is an individual) is amended as follows. In sub-paragraph (6)— Sub-paragraph (6)(ba) does not apply in relation to a spouse or civil partner of the purchaser if the two of them were not living together (see paragraph 9(3)) on the effective date of the transaction concerned. In sub-paragraph (7) after paragraph (b) (but before “and”) insert—. Sub-paragraph (7)(ba) does not apply in relation to a spouse or civil partner of the purchaser if the two of them are not living together (see paragraph 9(3)) on the effective date of that other land transaction.
After paragraph 9A (as inserted by paragraph 4 of this Schedule) insert—
Expressions used in this Part of this Schedule that are defined for the purposes of Part 3 of FA 1996 have the same meaning in this Part of this Schedule as in Part 3 of that Act (as amended by this Schedule).
In section 259K (overview of Chapter 11), after subsection (4) insert—
Section 259KC (denial of the relevant deduction in relation to imported mismatch payments) is amended as follows. After subsection (2) insert— In subsections (4)(a) and (7)(a), for “subsection (6)(a)” substitute “section 259KA(6)(a)”.
After section 259KC insert—
In section 54 (appeals), in subsection (2)—
for “it is an assessment” substitute it is—;
at the end insert , or
The amendments made by this Schedule have effect in relation to disposals that are made (or treated as made) on or after 1 April 2018. Sub-paragraph (1) does not apply to the amendments made by paragraph 17 (as to which, see paragraph 30).
The amendments made by this Schedule come into force in accordance with provision made by the Treasury by regulations. Regulations under sub-paragraph (1)—
Part 4 of Schedule 19 to FA 2011 (bank levy: chargeable equity and liabilities) is amended as follows.
Paragraph 54 (meaning of “the responsible member”) is amended in accordance with this paragraph. In sub-paragraph (3) (requirements), for paragraphs (c) and (d) substitute— In sub-paragraph (3), in the words after paragraph (d)— The renewal conditions are met in relation to E if— In sub-paragraphs (3) and (3A), “nomination period” means the first 45 days of the chargeable period. Sub-paragraph (6B) applies if— Where this sub-paragraph applies— In sub-paragraph (7), after “(as the case may be),” insert “and sub-paragraph (6B) does not apply,”.
Schedule 5 is amended as follows. In paragraph 27 (interest on unpaid tax etc)— In paragraph 33 (assessments: time limits)— In paragraph 36 (the register: publication)—
After paragraph 55, insert—
In section 1291(4) of CTA 2009 (meaning of “employee benefit scheme”), for paragraph (a) (but not the “or” following it) substitute—.
Section 264A of ITA 2007 (restricting VCT relief where there is a linked sale) is amended as follows. In subsection (5), at the beginning of paragraph (b) insert “ if subsection (7A) applies, ”. After subsection (7) insert—
The amendments made by paragraphs 2 to 5, 10 and 13 have effect in relation to periods of account of worldwide groups that begin on or after 1 January 2018. The following provisions apply if— In this paragraph— For the purposes of Part 10 of TIOPA 2010, the group’s actual financial statements are treated as not having been drawn up. Instead, financial statements of the worldwide group are treated for those purposes as having been drawn up in respect of each of the following periods— If condition C or D in section 481 of TIOPA 2010 is met in relation to the group’s actual financial statements, the financial statements treated as drawn up by sub-paragraph (5) are treated as drawn up in accordance with the generally accepted accounting principles and practice with which the group’s actual financial statements were drawn up. If neither of those conditions is met in relation to the group’s actual financial statements, the financial statements treated as drawn up by sub-paragraph (5) are IAS financial statements. If, for the purpose of determining amounts recognised in the financial statements treated as drawn up by sub-paragraph (5), it is expedient to apportion any amount that is recognised in the group’s actual financial statements, the apportionment is to be made in accordance with section 1172 of CTA 2010 (apportionment on a time basis). But if it appears that apportionment in accordance with that section would work unjustly or unreasonably, the apportionment is to be made on a just and reasonable basis. Expressions used in this paragraph and in Part 10 of TIOPA 2010 have the same meaning in this paragraph as they have in that Part.
In Part 5 (supplementary provision), omit paragraphs 43 and 44 (joint ventures). In paragraph 27(2)(b) (determining the amount of a relevant foreign bank’s chargeable equity and liabilities: adjustments), omit “and 44”.
In paragraph 24(1) (steps to determine UK allocated equity and liabilities), in Step 3, for “chargeable equity and liabilities” substitute “adjusted equity and liabilities”.
Part 10 of TIOPA 2010 has effect, and is to be deemed always to have had effect, with the amendments set out in paragraphs 6 to 9, 12 and 18 to 21. But, in the case of the amendment set out in paragraph 6 or 12, the reporting company of the worldwide group for any period of account beginning before 1 January 2018 may make an election for the amendment to have no effect in relation to the period of account. Paragraph 12 of Schedule 7A to TIOPA 2010 applies to an election under sub-paragraph (2). Expressions used in this paragraph and in Part 10 of TIOPA 2010 have the same meaning in this paragraph as they have in that Part.
Paragraph 25 (UK allocated equity and liabilities: netting) is amended as follows. In sub-paragraph (1), in the words before paragraph (a), after “applies” insert “for the purposes of Steps 1 and 2 in paragraph 24(1)”. In sub-paragraph (1)(c), for the words from “makes provision” to “occurs” substitute “makes net settlement provision”. In sub-paragraph (1)(c), “net settlement provision” means provision for there to be a single net settlement— The reference in sub-paragraph (1A) to a “single net settlement” is a reference to a single net settlement of— But a provision for there to be single net settlement— is not to be treated as a net settlement provision for the purposes of sub-paragraph (1)(c). If the UK allocated equity and liabilities of the bank are being determined for the purposes of paragraph 15(2)(b), this paragraph does not apply if N is— In sub-paragraph (3)(d), for ““the netting event occurs”” substitute ““a netting event occurs””. Omit sub-paragraph (8). Omit sub-paragraph (13).
The amendment made by paragraph 11 has effect in relation to accounting periods beginning on or after 1 January 2018.
In paragraph 26(4), for “paragraph 17(17) or 19(17)” substitute “paragraph 15(2)(b)”.
The amendments made by paragraph 15 have effect in relation to interest restriction returns whenever submitted.
Paragraph 27 (UK allocated equity and liabilities: determining the amount of the foreign bank’s chargeable equity and liabilities) is amended in accordance with this paragraph. In sub-paragraph (2)— In sub-paragraph (3), for paragraph (b) (but not the “and” following it) substitute—. In sub-paragraph (5), in the words before paragraph (a), for “paragraph 17(7) or 19(17)” substitute “paragraph 15(2)(b)”. In sub-paragraph (5), for paragraphs (a) and (b) substitute— In sub-paragraph (5), references to “UK connected liabilities” have the same meaning as in paragraph 15R(2) (see paragraph 15R(3) to (5)).
The amendment made by paragraph 16 does not have effect in relation to any case where a company tax return is amended before the day on which this Act is passed.
After paragraph 27 insert—
Schedule 4 contains provision about EIS and VCT reliefs in relation to knowledge-intensive companies.
Schedule 5 contains further amendments about venture capital trusts.
Schedule 6 contains provision relating to the taxation of partnerships.
In section 104M of CTA 2009 (amount of R&D expenditure credit), in subsection (3), for “11%” substitute “ 12% ”.
The amendment made by subsection (1) has effect in relation to expenditure incurred on or after 1 January 2018.
In section 739 of CTA 2009 (meaning of “proceeds of realisation”) after subsection (1) insert—
The amendment made by this section applies in relation to a realisation which takes place on or after 22 November 2017, unless it takes place pursuant to an obligation, under a contract, that was unconditional before that date.
For the purposes of subsection (2), an obligation is “unconditional” if it may not be varied or extinguished by the exercise of a right (whether under the contract or otherwise).
In section 844 of CTA 2009 (overview of Chapter 13 of Part 8: transactions between related parties) after subsection (2) insert—
After section 849A of that Act insert—
The amendments made by this section apply in relation to a grant of a licence or other right made on or after 22 November 2017, unless it is made pursuant to an obligation, under a contract, that was unconditional before that date.
For the purposes of subsection (3), an obligation is “unconditional” if it may not be varied or extinguished by the exercise of a right (whether under the contract or otherwise).
Chapter 4 of Part 8 of CTA 2010 (oil activities: calculation of profits) is amended as follows.
In section 291 (corporation tax treatment of oil activities: tariff receipts etc), for subsection (9) substitute—
After section 291 (but before the italic heading preceding section 292) insert—
In section 291—
in subsection (2), omit “or tax-exempt tariffing receipt”,
in subsection (6), omit “or tax exempt tariffing receipts”, and
in subsection (7), in both places, omit “or tax exempt tariffing receipt”.
The amendments made by subsections (1) to (4) have effect in relation to accounting periods beginning on or after 1 January 2018.
In the Investment Allowance and Cluster Area Allowance Regulations (Investment Expenditure) Regulations 2017 (S.I. 2017/292), in regulation 3 (operating expenditure)—
in paragraph (2)(e), omit “or tax-exempt tariffing receipts”,
“tariff receipts” has the same meaning as it has for the purposes of section 291 of the Corporation Tax Act 2010 (corporation tax treatment of oil activities: tariff receipts etc); and
in that paragraph, omit the definition of “tax-exempt tariffing receipts” (and the “and” following it).
The amendments made by subsection (6) have effect in relation to any expenditure that is incurred on or after 1 January 2018.
The amendments made by subsection (6) are to be treated as having been made by the Treasury under the applicable powers to make regulations conferred by sections 332BA and 356JE of CTA 2010.
Schedule 7 contains provision amending Part 6A of TIOPA 2010 (hybrid and other mismatches).
Schedule 8 contains provision relating to Part 10 of TIOPA 2010 (corporate interest restriction).
In CTA 2010, after section 987A insert—
The amendment made by this section is to be treated as having come into force on 1 April 2015.
TCGA 1992 is amended as follows.
In section 53 (indexation allowance), before subsection (2) insert—
In section 54 (calculation of indexation allowance)—
in subsection (1), in the definition of “RD”, for “the month in which the disposal occurs” substitute “ December 2017 ”;
before subsection (2) insert—
In section 110 (indexation for section 104 holdings for corporation tax)—
in subsection (10), in the definition of “RE”, for “the month in which the operative event occurs” substitute “ December 2017 ”;
for subsection (11) substitute—
In section 114 (consideration for options: corporation tax)—
in subsection (2), in the definition of “RO”, for “the month in which falls the date on which the option is exercised” substitute “ December 2017 ”;
for subsection (3) substitute—
Subject to subsection (7), the amendments made by this section have effect in relation to disposals on or after 1 January 2018.
This section does not affect the computation of the amount of so much of any gain as—
is treated for the purposes of the taxation of chargeable gains as having accrued on a disposal on or after 1 January 2018, but
is taken for those purposes to be equal to the whole or a part of a gain that—
would, but for an enactment relating to the taxation of chargeable gains, have accrued on an actual disposal made before 1 January 2018, or
would have accrued on a disposal assumed under such an enactment to have been made before that date.
In section 140 of TCGA 1992 (postponement of charge on transfer of assets to non-resident company), after subsection (4A) insert—
The amendment made by this section has effect in relation to disposals on or after 22 November 2017.
In section 176(1) of TCGA 1992 (depreciatory transactions within a group of companies), for “within the period of 6 years ending with the disposal” substitute “ on or after 31st March 1982 ”.
The amendment made by this section has effect in relation to disposals of shares in, or securities of, a company—
made on or after 22 November 2017, or
treated as made at an earlier time specified in a claim under section 24 of TCGA 1992 (negligible value claims) made on or after that date.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Schedule A1 to CAA 2001 (first-year tax credits) is amended as follows.
In paragraph 2 (amount of first-year tax credit)—
in sub-paragraph (1)(a), for “19%” substitute “the applicable percentage”;
The applicable percentage is two-thirds of— (But see also sub-paragraph (3A) (ring fence profits).)
Where the profits of the qualifying activity are ring fence profits, the applicable percentage is— and in either case, if there is more than one rate, assuming tax was chargeable at the average of those rates over the period. In this paragraph, “ring fence profits” and “the small ring fence profits rate” have the same meaning as in Part 8 of CTA 2010 (see sections 276 and 279A(4) of that Act). Where the applicable percentage given by sub-paragraph (1A) or (3A) would otherwise be a figure with more than 2 decimal places, it is to be rounded up to the nearest second decimal place.
omit sub-paragraphs (4) and (5).
In paragraph 3(1)(b) (meaning of relevant first-year expenditure) for “31 March 2018” substitute “31 March 2023”.
In paragraph 24(6) (clawback of first-year tax credit) for “percentage specified in” substitute “applicable percentage for the purposes of”.
In consequence of subsection (2)(d), in F(No.2)A 2017, in Schedule 7, omit paragraph 28.
The amendments made by subsections (2), (4) and (5) have effect in relation to chargeable periods beginning on or after 1 April 2018.
Subsection (8) applies if a company has a chargeable period beginning before 1 April 2018 and ending on or after that date (“the straddling period”).
For the purposes of calculating the amount mentioned in paragraph 2(1)(a) of Schedule A1 to CAA 2001—
so much of the straddling period as falls before 1 April 2018, and so much of that period as falls on or after that date, are treated as separate chargeable periods, and
the company’s surrenderable loss in the straddling period is to be apportioned between the two separate parts on a just and reasonable basis.
Part 2 of TIOPA 2010 (double taxation relief) is amended as follows.
After section 71 insert—
In section 78(1) (meaning of “overseas permanent establishment”)—
for “72” substitute “ 71A ”, and
after “means” insert “ , in relation to a company, ”.
In section 112(4) (deduction from income for foreign tax instead of credit against UK tax), after paragraph (a) insert—.
Section 71B of TIOPA 2010 has effect in relation to accounting periods beginning on or after 22 November 2017.
For the purposes of sections 71A and 71B of TIOPA 2010, if a company has an accounting period beginning before, and ending on or after, that date (“the straddling period”)—
so much of the straddling period as falls before that date, and so much of it as falls on or after that date, are treated as separate accounting periods, and
any amounts brought into account for the purposes of calculating the credit relief of the company for the straddling period are apportioned to the two separate accounting periods—
in accordance with section 1172 of CTA 2010 (time basis), or
if that method would produce a result that is unjust or unreasonable, on a just and reasonable basis.
In determining whether or not section 71B of TIOPA has effect in relation to an accounting period of a company—
it is to be assumed that the amendments made by this section were in force in relation to all previous accounting periods of the company except those beginning before 22 November 2011, and
no account may be taken of any accounting period beginning before that date.
TIOPA 2010 is amended as follows.
For section 81 (giving a counteraction notice) substitute—
In section 87 (section 83(2) and (4): schemes that would reduce a person‘s tax liability)—
in subsection (1), after “person” insert “ (“P”) ”,
in subsection (3), for “the amount of UK tax payable by the person” substitute “ the total amount of UK tax payable by P and such persons (if any) as are connected with P ”,
in subsection (4), for “the amount of UK tax that would be payable by the person” substitute “ the total amount of UK tax that would be payable by P and such persons (if any) as are connected with P ”, and
at the end insert—
Omit sections 89 to 95 (counteraction notices).
In section 371SR (double taxation relief: counteraction notices)—
in subsection (1), for “giving of counteraction notice” substitute “ countering effect of avoidance arrangements ”, and
in the heading, for “counteraction notices” substitute “ countering effect of avoidance arrangements ”.
The amendments made by subsections (2), (4) and (5) have effect in relation to any return under TMA 1970 or Schedule 18 to FA 1998 where the date by which the return is required to be made is after 31 March 2018.
The amendments made by subsection (3) have effect in relation to a credit for foreign tax which relates to a payment of foreign tax on or after 22 November 2017.
In section 2 of TIOPA 2010 (giving effect to arrangements made in relation to other territories) after subsection (1) insert—
In section 3 of that Act (arrangements may include retrospective or supplementary provision), in subsection (2)—
in paragraph (b) omit the final “or”;
after paragraph (c) insertor
In section 158 of IHTA 1984 (double taxation conventions), after subsection (1) insert—
The amendments made by subsections (1) to (3) are to be regarded as always having had effect.
The provision made by section 2(1A) and 3(2)(d) of TIOPA 2010 in relation to Orders under section 2 of that Act applies, and is to be regarded as always having applied, in relation to Orders in Council under any provision which that section replaces (directly or indirectly).
The provision made by section 158(1ZA) and (1ZB) of IHTA 1984 in relation to Orders under section 158 of that Act applies, and is to be regarded as always having applied, in relation to Orders in Council under any provision which that section replaces (directly or indirectly).
Schedule 9 contains provision amending Schedule 19 to FA 2011 (the bank levy).
In section 987 of ITA 2007 (meaning of “quoted Eurobond”)—
the current text becomes subsection (1);
in paragraph (b) of that subsection, after “exchange” insert “ or admitted to trading on a multilateral trading facility operated by an EEA-regulated recognised stock exchange ”;
after that subsection insert—
In each of section 151N of TCGA 1992, section 564G of ITA 2007 and section 507 of CTA 2009 (investment bond arrangements)—
in subsection (1)(h), after “exchange” insert “ or admitted to trading on a multilateral trading facility operated by an EEA-regulated recognised stock exchange ”;
in subsection (2)—
omit the “and” at the end of paragraph (h);
after paragraph (i) insert—
The amendments made by subsection (1) have effect in relation to payments made on or after 1 April 2018.
The amendments made by subsection (2) have effect—
for corporation tax purposes, in relation to accounting periods beginning on or after 1 April 2018;
for income tax and capital gains tax purposes, for the tax year 2018-19 and subsequent tax years.
Schedule 10 contains provision about capital gains tax and income tax in connection with settlements.
Section 94E of ITTOIA 2005 (excluded vehicles) is amended in accordance with subsections (2) and (3).
In subsection (3)(b)—
for “the trade” substitute “ any relevant trade or business ”;
for “section 25A” substitute “ sections 25A and 271D ”.
After subsection (3) insert—
In Chapter 5A (deductions allowable at a fixed rate) section 94C exclusion of provisions of Chapter 5A for firms with partner who is not an individual sections 94D to 94G expenditure on vehicles
In Chapter 5A (deductions allowable at a fixed rate) section 94C exclusion of provisions of Chapter 5A for firms with partner who is not an individual sections 94D to 94G expenditure on vehicles
In section 59 of CAA 2001 (unrelieved qualifying expenditure)—
in subsection (8)—
at the end of paragraph (b), insert “ and ”;
omit paragraph (d) (and the “and” before it);
after subsection (9) insert—
The amendments made by subsections (2), (3) and (6)(a) have effect for the tax year 2018-19 and subsequent tax years.
The amendments made by subsections (4), (5) and (6)(b) have effect for the tax year 2017-18 and subsequent tax years.
Section 94E of ITTOIA 2005 (meaning of “excluded vehicles”) has effect, in its application as a result of section 271E of that Act (profits of a property business: application of trading income rules), as if after subsection (2) there were inserted—
In the following provisions of F(No.2)A 2015 (which relate to carried interest) omit the words from “unless” to “that date”—
section 43(2);
section 43(4);
section 45(3)(b).
The amendments made by subsection (1) have effect in relation to carried interest arising on or after 22 November 2017.
For the purposes of subsection (2) “carried interest” and “arising” have the same meaning as in the provisions amended.
VATA 1994 is amended as follows.
In section 69(1) (breaches of regulatory provisions) after paragraph (g) insertor— .
Before section 77B insert— “ Online marketplaces ”.
In section 77B (joint and several liability: operators of online marketplaces)—
in the heading for “operators of online marketplaces” substitute “ sellers identified as non-compliant by the Commissioners ”;
in subsection (1) omit “who is not UK-established”;
omit subsection (10);
“UK-established”
After section 77B insert—
In section 77C (assessments)—
in the heading after “section 77B” insert “ or 77BA ”;
in subsection (1) after “section 77B” insert “ or 77BA ”;
for subsection (9) substitute—
In section 77D (interest)—
in the heading after “section 77B” insert “ or 77BA ”;
for subsection (8) substitute—
After section 77D insert—
In section 33 of VATA 1994 (refunds of VAT in certain cases), subsection (3) is amended as follows.
In paragraph (a) after “a local authority” insert “ and a combined authority established by an order made under section 103(1) of the Local Democracy, Economic Development and Construction Act 2009 ”.
After paragraph (a) insert—.
In paragraph (f), omit “a police authority and”.
After paragraph (f) insert—.
The amendments made by this section have effect in relation to supplies made, and acquisitions and importations taking place, on or after the day on which this Act is passed.
Schedule 11 contains amendments to Schedule 4ZA to FA 2003 (stamp duty land tax: higher rates for additional dwellings and dwellings purchased by companies).
Part 4 of FA 2003 (stamp duty land tax) is amended as follows.
After section 57A insert—
After Schedule 6 insert—
In section 110 (approval of regulations under general power) at the end insert—
In Schedule 9 (right to buy, shared ownership leases etc), at the end insert—
The following provisions (which are spent provisions relating to first-time buyers) are repealed—
section 57AA of FA 2003,
section 73CA of that Act,
section 110(6) of that Act,
paragraph 15 of Schedule 9 to that Act, and
section 6 of FA 2010.
In Schedule 2 to the Wales Act 2014 (amendments relating to the disapplication of UK stamp duty land tax in relation to Wales), after paragraph 9 insert—
The amendments made by subsections (1) to (5) have effect in relation to any land transaction of which the effective date is or is after 22 November 2017.
Schedule 12 makes provision about landfill tax, including provision for disposals of material elsewhere than at landfill sites to be chargeable.
That Schedule has effect only in relation to disposals made in England or Northern Ireland.
Chapter 4 of Part 1 of FA 1994 (air passenger duty) is amended as follows.
In section 30(4A)(b) as amended by F(No.2)A 2017 (rate for long haul departures not from Northern Ireland: travel not in sole or lowest class, and higher rate does not apply), for “£156” substitute “ £172 ”.
In section 30(4E)(d) (higher rate for long haul departures not from Northern Ireland is six times standard-class long haul rate), for “six” substitute “ 6.6 ”.
In section 30A(5A)(c)(ii) (higher rate for long haul departures from Northern Ireland if not set by Act of the Northern Ireland Assembly is six times standard-class rate for long haul departures from Northern Ireland), for “six” substitute “ 6.6 ”.
The amendments made by this section have effect in relation to the carriage of passengers beginning on or after 1 April 2019.
Schedule 1 to VERA 1994 (annual rates of duty) is amended as follows.
In paragraph 1 (general rate)—
in sub-paragraph (2) (vehicle not covered elsewhere in Schedule with engine cylinder capacity exceeding 1,549cc), for “£245” substitute “ £255 ”, and
in sub-paragraph (2A) (vehicle not covered elsewhere in Schedule with engine cylinder capacity not exceeding 1,549cc), for “£150” substitute “ £155 ”.
In paragraph 1B (rates for light passenger vehicles registered before 1 April 2017)—
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 30 120 130 110 120 130 140 130 140 140 150 145 155 150 165 185 195 165 175 220 230 175 185 240 250 185 200 280 290 200 225 305 315 225 255 530 540 255 545 555
in the sentence immediately following the Table, for paragraphs (a) and (b) substitute—
For paragraph 1GC (rates on first licence for light passenger vehicles registered on or after 1 April 2017) substitute—
In paragraph 1J (rates for light goods vehicles) in paragraph (a) for “£240” substitute “ £250 ”.
In paragraph 2(1) (rates for motorcycles)—
in paragraph (a), for “£18” substitute “ £19 ”,
in paragraph (b), for “£41” substitute “ £42 ”,
in paragraph (c), for “£62” substitute “ £64 ”, and
in paragraph (d), for “£85” substitute “ £88 ”.
The amendments made by this section have effect in relation to licences taken out on or after 1 April 2018.
TPDA 1979 is amended as follows.
1 Cigarettes An amount equal to the higher of— 16.5% of the retail price plus £217.23 per thousand cigarettes, or £280.15 per thousand cigarettes. 2 Cigars £270.96 per kilogram 3 Hand-rolling tobacco £221.18 per kilogram 4 Other smoking tobacco and chewing tobacco £119.13 per kilogram
The amendment made by this section is treated as having come into force at 6pm on 22 November 2017.
Section 24 of FA 1994 (power to enter premises and inspect goods) is amended as follows.
The existing text becomes subsection (1).
In that subsection—
at the beginning insert “ This section applies ”;
omit the words after paragraph (b).
After that subsection insert—
In section 163 of CEMA 1979 (power to search vehicles or vessels), after subsection (1) insert—
Schedule 1 to VERA 1994 (annual rates of duty) is amended in accordance with subsections (2) to (5).
In paragraph 1A(2) (meaning of “light passenger vehicle”), at the end insert “ or, as the case may be, within Category M1 of Annex II to Directive 2007/46/EC (vehicle designed and constructed primarily for the carriage of passengers and comprising no more than 8 seats in addition to the driver's seat) ”.
In paragraph 1G(1) (meaning of “EU certificate of conformity”), for “issued by a manufacturer under any provision of the law of a Member State implementing Article 6 of Council Directive 70/156/EEC, as amended” substitute “ within the meaning of Council Directive 70/156/EEC or Directive 2007/46/EC of the European Parliament and of the Council of 5 September 2007 ”.
In paragraph 1GA (vehicles to which Part 1AA applies etc)—
in sub-paragraph (2), for “has the meaning given by paragraph 1A(2)” substitute “ means a vehicle within Category M1 of Annex II to Directive 2007/46/EC (vehicle designed and constructed primarily for the carriage of passengers and comprising no more than 8 seats in addition to the driver's seat) ”,
omit sub-paragraph (3)(a),
for sub-paragraph (3)(d) substitute—, and
after sub-paragraph (3) insert—
In paragraph 1H(2) (meaning of “light goods vehicle”), at the end insert “ or, as the case may be, within Category N1 of Annex II to Directive 2007/46/EC (vehicle designed and constructed primarily for the carriage of goods and having a maximum mass not exceeding 3.5 tonnes) ”.
In Schedule 2 to VERA 1994 (exempt vehicles), in paragraph 25(4)(b), for “Schedule)” substitute “ Schedule as read with paragraph 1GA(5) of that Schedule) ”.
The amendments made by subsections (2) to (6) have effect in relation to licences taken out on or after 29 November 2017.
ITEPA 2003 is amended in accordance with subsections (9) to (11).
In section 136 (car with a CO2 emissions figure: post-September 1999 registration)—
after subsection (2) insert—, and
in subsection (3), for “This” substitute “ Subsection (2) ”.
In section 137 (car with a CO2 emissions figure: bi-fuel cars)—
after subsection (2) insert—, and
in subsection (3), for “This” substitute “ Subsection (2) ”.
In section 171(1) (minor definitions: general)—
in the definition of “EC certificate of conformity”, for “issued by a manufacturer under any provision of the law of a Member State implementing Article 6 of Council Directive 70/156/EEC, as amended” substitute “ within the meaning of Council Directive 70/156/EEC or Directive 2007/46/EC of the European Parliament and of the Council of 5 September 2007 ”, and
in the definition of “EC type-approval certificate”, for “Council Directive 70/156/EEC, as amended” substitute “ Council Directive 70/156/EEC or an EC type-approval certificate within the meaning of Council Directive 2007/46/EC ”.
The amendments made by subsections (9) to (11) have effect for the tax year 2017-18 and subsequent tax years.
In this Act the following abbreviations are references to the following Acts. CAA 2001 Capital Allowances Act 2001 CEMA 1979 Customs and Excise Management Act 1979 CTA 2009 Corporation Tax Act 2009 CTA 2010 Corporation Tax Act 2010 FA, followed by a year Finance Act of that year F(No.2)A, followed by a year Finance (No.2) Act of that year F(No.3)A, followed by a year Finance (No.3) Act of that year IHTA 1984 Inheritance Tax Act 1984 ITA 2007 Income Tax Act 2007 ITEPA 2003 Income Tax (Earnings and Pensions) Act 2003 ITTOIA 2005 Income Tax (Trading and Other Income) Act 2005 TCGA 1992 Taxation of Chargeable Gains Act 1992 TIOPA 2010 Taxation (International and Other Provisions) Act 2010 TMA 1970 Taxes Management Act 1970 TPDA 1979 Tobacco Products Duty Act 1979 VATA 1994 Value Added Tax Act 1994 VERA 1994 Vehicle Excise and Registration Act 1994
This Act may be cited as the Finance Act 2018.
Section 11
In section 554A of ITEPA 2003 (employment income provided through third parties: application of Chapter 2 of Part 7A), after subsection (5) insert—
In Part 7A of ITEPA 2003 (employment income provided through third parties), after section 554A (application of Chapter 2) insert—
Section 47 (registration) is amended as follows. In subsections (2)(a), (5) and (6), after “taxable activities” insert “at a landfill site”. After subsection (3) insert— After subsection (5) insert— In subsection (6), for “a person” substitute “a registered person”. For subsection (9) substitute— For subsection (10) substitute—
Section 41 (liability to pay tax) is amended as follows. In subsection (1), after “a taxable disposal” insert “made at a landfill site”. After subsection (2) insert—
After section 259LA insert—
Part 10 of TIOPA 2010 (corporate interest restriction) is amended as follows.
In section 554Z2 of ITEPA 2003 (value of relevant step to count as employment income), after subsection (1) insert— After section 554Z2 of ITEPA 2003, insert—
In paragraph 4 (bank levy to be charged in relation to certain groups of entities), omit sub-paragraphs (5) to (7).
Schedule 11 to F(No.2)A 2017 (employment income provided through third parties: loans etc outstanding on 5 April 2019) is amended as follows. Before paragraph 37 (but after the italic heading preceding that paragraph) insert—
In paragraph 12 (definition of “banking group”), in sub-paragraph (7), omit paragraph (b) and the “or” preceding it.
In paragraph 13 (definition of “banking group”: exempt activities condition)—
in sub-paragraph (2)(b)(i), for “the applicable accounting standards” substitute “international accounting standards”,
in sub-paragraph (4), omit the definition of “the applicable accounting standards”, and
in sub-paragraph (4), in the definition of “net-basis activities”, for “the applicable accounting standards” substitute “international accounting standards”.
In paragraph 14 (definition of “assets”, “equity” and “liabilities”), omit sub-paragraph (2).
In paragraph 24 (definition of “UK allocated equities and liabilities”)—
in sub-paragraph (2)(a), omit “or UK GAAP”, and
in sub-paragraph (2)(b), omit sub-paragraph (ii) and the “or” preceding it.
In paragraph 35 (exclusion of relevant tax liabilities)—
in sub-paragraph (2), in the words before paragraph (a), omit the words from “In relation to” to “international accounting standards,”;
omit sub-paragraph (3).
In paragraph 36 (exclusion of relevant retirement benefit liabilities)—
in sub-paragraph (2), omit the words from “In relation to” to “international accounting standards,”;
omit sub-paragraph (3).
In paragraph 42 (financial statements etc)—
in sub-paragraph (8), omit paragraphs (b) and (c), and
omit sub-paragraphs (9) and (10).
In paragraph 70 (general definitions)—
omit the definition of “UK GAAP”, and
omit the definition of “US GAAP”.
In paragraph 71 (definition of “asset management activities”), in sub-paragraph (3), omit paragraph (b) and the “or” preceding it.
In paragraph 72 (definition of “capital resources condition”), in sub-paragraph (7), omit paragraph (b) and the “or” preceding it.
In paragraph 73 (definition of “excluded entity”), in sub-paragraph (3), omit paragraph (b) and the “or” preceding it.
In paragraph 81 (power to make consequential changes), in sub-paragraph (1)(c) omit “, UK GAAP or US GAAP”.
Part 7A of ITEPA 2003 (employment income provided through third parties) is amended in accordance with this paragraph. In the italic heading before section 554A, at the end insert “ : main case ”. In the heading of section 554A, at the end insert “ : main case ”. In section 554Z(2) (interpretation: “A” and “B”) at the end insert “ or, as the case may be, section 554AA(1) ”.
In section 274 of ITA 2007 (requirements for the giving of approval), in the fifth entry of the table in subsection (2) (the 70% qualifying holdings condition), for “70%” in the first and second columns substitute “ 80% ”.
Part 8 of Schedule 2 to ITA 2007 (transitional provision: venture capital trusts) is amended as follows. In paragraph 69 (the no guaranteed loan requirement), after “acquired” insert “ before 6 April 2018 ”. In paragraph 70 (the proportion of eligible shares requirement), in sub-paragraph (2), after “acquired” insert “ before 6 April 2018 ”. In paragraph 81 (meaning of “excluded activities”), after “acquired” insert “ before 6 April 2018 ”.
In section 259HB (multinational payee deduction/non-inclusion mismatches and their extent), after subsection (2) insert—
In section 259CC (interpretation of section 259CB), at the end insert—
In consequence of the amendment made by paragraph 2, in each of the following provisions of ITA 2007, for “70%”, where it appears before “qualifying”, substitute “80%”—
in section 274, subsection (3)(c), (d) and (e);
in section 275 (alternative requirements for the giving of approval), subsection (3)(b);
in section 278 (conditions relating to value of investments: general), subsection (1);
in section 280 (conditions relating to qualifying holdings and eligible shares), subsection (2);
in section 280A (the 70% qualifying holdings condition: disposal of holding), in the heading and in subsection (2);
in Schedule 4 (index of defined expressions), the entry for the qualifying holdings condition.
In Part 1 of Schedule 16 to FA 2007 (venture capital trusts: limit on number of employees in company in which investment made), in paragraph 3(6)(b), after “(“the investing company”)” insert “ before 6 April 2018 ”.
In Schedule 11 to FA 2008 (venture capital trusts), in paragraph 12(b), after “(“the investing company”)” insert “ before 6 April 2018 ”.
In section 280A of ITA 2007, in subsection (2)(a), for “6” substitute “ 12 ”.
In Schedule 2 to F(No.3)A 2010 (venture capital trusts), in paragraph 6(2)(b), after “the investing company” insert “ before 6 April 2018 ”. The 30% eligible shares condition does not apply in relation to an accounting period ending on or after 6 April 2018. In sub-paragraph (2) “the 30% eligible shares condition” means the condition referred to as such in section 274(2) of ITA 2007 as originally enacted.
In section 39(4) of ITTOIA 2005 (meaning of “employee benefit scheme”), for paragraph (a) (but not the “or” following it) substitute—.
In TCGA 1992, after section 87C insert— In sections 2(4) and (5), 16ZC(4) and 62(2A)(a) of TCGA 1992, after “87” insert “, 87K, 87L”. In section 86A(1) of TCGA 1992 (attribution of gains to settlor in temporary non-residence cases)— In section 87 of TCGA 1992 (non-UK resident settlements: attribution of gains to beneficiaries)— In section 87B of TCGA 1992 (section 87: remittance basis)— In section 89(3) of TCGA 1992 (application of sections 87 to 87C in relation to migrant settlements), for “87C” substitute “87P”. In section 91 of TCGA 1992 (increase in tax payable under section 87 or 89(2))— In sections 279A(7)(b) and 279C(6)(c) of TCGA 1992, after “87” insert “, 87K, 87L”. In paragraph 1A of Schedule 4C to TCGA 1992— Sections 87G(2), 87K(2) and 87L(2) (capital payment treated for purposes of sections 87 and 87A as received by someone other than actual recipient) apply also for the purposes of this paragraph, but this is subject to paragraph 9. In consequence of sub-paragraph (4)(b), in Schedule 45 to FA 2013 omit paragraph 101. The new sections 87D and 87E have effect— The new sections 87F and 87G, and the amendments made by sub-paragraphs (4) and (11), have effect in relation to payments received in the tax year 2018-19 or a later tax year. The new sections 87I to 87M have effect in relation to onward payments made on or after 6 April 2018, and do so even in cases where the original payment is received before that date. The new sections 87N and 87P have effect where the particular tax year is the tax year 2018-19 or a later tax year. The amendment made in section 89 has effect for the tax year 2018-19 and later tax years.
The following provisions of paragraph 1 come into force on the day on which section 3 of the Pension Schemes Act 2017 (prohibition on operating Master Trust scheme unless authorised) comes into force or, if later, the day on which this Act is passed— The following provisions of paragraph 1 come into force on 6 April 2018— So far as not brought into force by sub-paragraph (1) or (2), and subject to sub-paragraph (4), paragraph 1 comes into force on the day on which this Act is passed. Paragraph 1(8) is treated as always having had effect. For the purposes of section 153(5)(h) and (i) of FA 2004 (as inserted by paragraph 1(3)) it is immaterial when the application in question was made.
The amendments made by paragraph 1 have effect in relation to claims for relief by reference to shares issued on or after 6 April 2014.
Sub-paragraph (2) applies in a case where— For the purposes of capital gains tax in respect of any chargeable gain treated by section 87 of TCGA 1992 as accruing to the individual as a result of matching of the payment (or part), section 809B(1A) of ITA 2007 does not have effect in relation to the tax year which consists of or includes the period of return. Where by virtue of sub-paragraph (2) the individual makes a claim under section 809B of ITA 2007 for any of the tax years 2018-19 to 2020-21 inclusive, sections 809C, 809G and 809H of ITA 2007 do not apply to the individual for that tax year. Part 4 of Schedule 45 to FA 2013 explains what “temporary period of non-residence” and “period of return” mean.
The other amendments made by this Schedule come into force in accordance with provision made by the Treasury by regulations.
Regulations under paragraph 13—
may make different provision for different purposes;
may provide for any of those amendments to come into force on or by reference to a day that is—
earlier than the day on which the regulations are made, but
not earlier than the day on which this Act is passed.
Schedule 11 to F(No.2)A 2017 (employment income provided through third parties: loans etc outstanding on 5 April 2019) is amended in accordance with this paragraph. In paragraph 1 (relevant step)—
Where the Commissioners become aware of a disposal that— the disposal is treated for the purposes of Part 3 of FA 1996 as having been made at that place on 1 April 2018. But a person cannot be guilty of an offence, or liable to a civil penalty, solely as a result of the retrospective effect of this paragraph.
In section 175A of ITA 2007 (the permitted maximum age condition for EIS relief), in paragraph (a) of subsection (2), for “beginning with the relevant first commercial sale,” substitutebeginning with— .
Section 285 of ITA 2007 (interpretation of Chapter 3 etc of Part 6) is amended as follows. In subsection (2)— After that subsection insert—
After section 454 insert—
A person who is liable (by virtue of paragraph 31) to pay tax on a disposal made before 1 April 2018 at a place other than a landfill site must— no later than 30 April 2018. The required information is— Subsections (2), (3), (6), (8) and (9) of section 71 of FA 1996 (orders and regulations) apply to regulations under sub-paragraph (2)(c) as they apply to regulations under Part 3 of that Act.
After section 252A of ITA 2007 insert—
Section 475 (meaning of “non-consolidated subsidiary” and “consolidated subsidiary”) is amended as follows. In subsection (1)(b), at the end insert “or on the basis that X were an asset held for sale or held for distribution to owners”. For subsection (3) substitute—
Schedule 41 to FA 2008 (penalties: failure to notify etc) has effect as if—
the obligation under paragraph 32 above were an obligation specified in the Table in paragraph 1 of that Schedule;
a reference in paragraph 6CA (inserted by paragraph 27(5) above) to paragraph 3A included a reference to paragraph 1 as it has effect by virtue of paragraph (a) above.
In section 280C of ITA 2007 (the permitted maximum age condition for VCT relief), in paragraph (a) of subsection (3), for “beginning with the relevant first commercial sale,” substitutebeginning with— .
Paragraphs 31 to 33 come into force on 1 April 2018.
In section 294A of ITA 2007 (the permitted company age requirement for VCT relief), in paragraph (a) of subsection (2), for “beginning with the relevant first commercial sale,” substitutebeginning with— .
After section 331A of ITA 2007 insert—
Schedule 11 to F(No.2)A 2017 (employment income provided through third parties: loans etc outstanding on 5 April 2019) is amended in accordance with this Part.
After paragraph 9 insert—
Sub-paragraphs (2) and (3) are subject to paragraph 9A (spouses and civil partners purchasing from one another).
Part 3 of FA 1996 (landfill tax) is amended as set out in the following provisions of this Part of this Schedule.
In section 49 (accounting for tax and time for payment), for “registrable person” substitute “registered person”.
In section 43 (material removed from water), in subsections (1), (3), (4) and (5), after “A disposal” insert “made at a landfill site”.
Part 6A of TIOPA 2010 (hybrid and other mismatches) is amended as follows.
In section 259DB (meaning of “hybrid transfer arrangement”, “underlying instrument” etc), at the end insert—
After paragraph 35 insert—
Paragraph 3 is amended as follows. But sub-paragraph (1) is subject to paragraph 7A. In sub-paragraph (7), in the opening words, for “may become” substitute “is also”.
Section 59 (groups of companies) is amended as follows. In subsection (2)— In subsection (3), for “The condition is that the” substitute The conditions are that—.
In section 44 (mining and quarrying), in subsection (1), after “A disposal” insert “made at a landfill site”.
In section 259DD (hybrid transfer deduction/non-inclusion mismatches: interpretation of section 259DC), at the end insert—
Paragraph 36 (duty to provide loan balance information to B) is amended in accordance with this paragraph. In sub-paragraph (2) for “loan balance information” substitute “ loan charge information (see paragraph 35D) ”. Omit sub-paragraphs (3), (5) and (6). In the italic heading preceding paragraph 36, for “balance” substitute “ charge ”.
In paragraph 6—
But sub-paragraph (1) is subject to paragraph 7A.
in sub-paragraph (3) for “and (7)” substitute “to (8)”.
In section 70 (interpretation), in subsection (1), for ““registrable person” has” substitute ““registered person” and “registrable person” have”.
Section 45 (pet cemeteries) is amended as follows. In subsection (1), after “A disposal” insert “made at a landfill site”. In subsection (2)—
In paragraph 8—
in sub-paragraph (1) for “ceases to be” substitute “is not”,
in sub-paragraph (2) for “was” substitute “is”,
in sub-paragraph (3) for “its ceasing to be a higher rates transaction” substitute “the application of paragraph 3(7)”, and
in sub-paragraph (4) for “its ceasing to be a higher rates transaction” substitute “the application of paragraph 3(7)”.
Schedule 5 is amended as follows. In paragraph 2 (records: registrable persons), in the heading and in sub-paragraphs (1) and (3)(a), for “registrable persons” substitute “taxable persons”. In paragraph 26 (interest on under-declared tax), in sub-paragraphs (1)(a) and (4), for “registrable person” substitute “registered person”. In paragraph 27 (interest on unpaid tax etc), in sub-paragraphs (1)(a), (3)(a), (5)(a) and (7), for “registrable person” substitute “registered person”.
In section 46 (power to vary), in subsection (2), before paragraph (a) insert—.
In paragraph 9(3) for “paragraph” substitute “Schedule”.
Paragraph 12 is amended as follows. In sub-paragraph (2)(a) after “any” insert “relevant”. For the purposes of sub-paragraph (2) a spouse or civil partner of P is “relevant” if the spouse or civil partner— Omit sub-paragraph (4).
In the italic heading before paragraph 17 omit “, Wales”.
Paragraph 17 is amended as follows. In sub-paragraph (1) omit “, Wales”. In the application of those provisions in relation to a dwelling situated in Wales— In sub-paragraph (3)— In sub-paragraph (4)— For the purposes of sub-paragraph (4) a spouse or civil partner of P is “relevant” if the spouse or civil partner— Omit sub-paragraph (6).
In section 128(9)(b) of FA 2016 for ““during that period of three years”” substitute “the words from “during” to “paragraph (b)””.
Section 689 of ITEPA 2003 (PAYE: employee of non-UK employer) is amended in accordance with this paragraph. In subsection (4), in the words before paragraph (a), after “employee,” insert “ and if the case is not within subsection (4A), ”. After subsection (4) insert—
Before the coming into force of section 3 of the Pension Schemes Act 2017 (prohibition on operating Master Trust scheme unless authorised), section 279 of FA 2004 has effect as if subsections (1B)(b) and (1C) (as inserted by paragraph 1(6)) were omitted.
Section 173A of ITA 2007 (the maximum amount raised annually through risk finance investments requirement for EIS relief) is amended as follows. In subsection (1), for “must not exceed £5 million” substitutemust not exceed— After subsection (5) insert—
Section 384 (relevant derivative contract debits) is amended as follows. In subsection (3), for paragraph (c) substitute— After subsection (3) insert—
In consequence of the preceding provisions of this Schedule, Schedule 19 to FA 2011 is amended as follows.
Section 292A of ITA 2007 (the maximum amount raised annually through risk finance investments requirement for VCT relief) is amended as follows. In subsection (1), for “must not exceed £5 million” substitutemust not exceed— After subsection (6) insert—
Section 387 (relevant derivative contract credits) is amended as follows. In subsection (3), for paragraph (c) substitute— After subsection (3) insert—
In paragraph 30(2), at the beginning insert “For the purposes of this paragraph,”.
In section 297B of ITA 2007 (the proportion of skilled employees requirement for VCT relief), in subsection (2)(a), after “sections” insert “ 292A, ”.
Section 411 (“relevant expense amount” and “relevant income amount”) is amended as follows. In subsection (1)(e), for sub-paragraph (iii) substitute—. In subsection (2)(d), for sub-paragraph (iii) substitute—.
In paragraph 40(1), for the words from “paragraphs 16” to the end substitute “paragraphs 15S to 15U, 15Z3, 15Z4, 25 and 27A to 27D.”
In section 412 (section 411: interpretation), after subsection (3) insert—
Paragraph 47 is amended in accordance with this paragraph. In sub-paragraph (11), for the words from “paragraph 16(1)(c) and (d)” to the end substitute “paragraph 15S(1)(d) and (e), 15T(1)(e) and (f), 15Z3(1)(c) and (d), 25(1)(c) and (d), 27A(1)(d) and (e) or 27B(1)(d) and (e).” In sub-paragraph (14)—
In paragraph 53(4)—
in paragraph (a), for “relevant UK banking sub-group” substitute “UK sub-group”,
for paragraph (b) substitute—,
omit paragraph (c), and
in paragraph (d), for “covered by paragraph 19(17)” substitute “which is a member of the relevant group”.
Paragraph 54 is amended in accordance with this paragraph. In sub-paragraph (5)(c)— In sub-paragraph (6)—
Paragraph 70 is amended in accordance with this paragraph. After the definition of “contract of insurance” insert—. After the definition of “entity” insert—. After the definition of “long term” insert—. After the definition of “relevant regulated activity” insert—. After the definition of “UK allocated equity and liabilities” insert—. In the definition of “UK sub-group” for “paragraph 17(4)” substitute “paragraph 15B”. Omit the definitions of—
In paragraph 77, after “subject to” insert “Step 7 in paragraph 15Z1 and”.
The amendment made by paragraph 1—
is to be treated as having come into force on 29 November 2017,
has effect for the purposes of the operation of Part 7A of ITEPA 2003 in relation to relevant steps taken on or after 22 November 2017, and
so has effect in the case of payments within the new subsection (5A)(a) whenever made (including ones made before 6 April 2011).
The amendments made by paragraphs 2, 3 and 5 of this Schedule in Part 7A of ITEPA 2003 have effect in relation to relevant steps taken on or after 6 April 2018.
The amendment made by paragraph 6 of this Schedule in section 39 of ITTOIA 2005 has effect in relation to employee benefit contributions (as defined in that section) made, or to be made, on or after 6 April 2018.
The amendment made by paragraph 7 of this Schedule in section 1291 of CTA 2009 has effect in relation to employee benefit contributions (as defined in that section) made, or to be made, on or after 1 April 2018.
Section 12
In Schedule 12 to F(No.2)A 2017 (trading income provided through third parties: loans etc outstanding on 5 April 2019), after paragraph 20 insert—
Section 13
Chapter 5 of Part 5 of ITTOIA 2005 (settlements: amounts treated as income of settlor) is amended as follows. In the Chapter heading, after “settlor” insert “or family”.
Section 40 (charge to tax) is amended as follows. For subsection (2) substitute— After subsection (3) insert—
Part 4 of FA 2004 (pension schemes etc) is amended in accordance with sub-paragraphs (2) to (8). In section 150 (meaning of “pension scheme”), after subsection (5) insert— In section 153 (registration of pensions schemes), in subsection (5), at the end insert, or In section 158 (grounds for de-registration) in subsection (1), at the end insert, or At the beginning of Chapter 8 (supplementary) insert— In section 279 (other definitions), after subsection (1A) insert— dormant (in relation to a body corporate) section 279(1E) Master Trust scheme section 279(1B) and (1C) unauthorised (in relation to a Master Trust scheme) section 279(1D) This Part of this Act applies in relation to a pension scheme that— as it applies in relation to an occupational pension scheme. In consequence of the amendment made by sub-paragraph (5), in section 30 of F(No.3)A 2010 (pension scheme under section 67 of Pensions Act 2008), omit subsection (1).
Sub-paragraph (2) applies to a pension scheme that— Section 274ZA(2) of FA 2004 is treated as always having had effect in relation to the pension scheme. In this paragraph, “Master Trust scheme” and “occupational pension scheme” have the same meaning as in Part 4 of FA 2004.
For paragraphs 15 to 23 (and the italic heading preceding paragraph 15) substitute—
In section 619(1) (list of provisions in the Chapter charging tax)—
omit the “and” at the end of paragraph (c), and
after paragraph (d) insert—
After section 40 insert—
In section 621 (income charged under the Chapter), for “income and capital sums” substitute “income, capital sums and benefits”.
In section 622 (person liable), at the end insert “, but this is subject to sections 643A and 643I to 643M.”
In section 623 (deductions and reliefs allowed when calculating liability under the Chapter)—
for “a settlor” substitute “an individual”, and
for “the settlor”, in both places it occurs, substitute “the individual”.
In section 635 (amount of available income for section 633 purposes)—
in subsection (3)(d)(i) (tax on certain income to be deducted when calculating available amount), before “income” insert “unprotected”, and
in subsection (5) (meaning of “unprotected income”), for “subsection (2)” substitute “this section and sections 636 and 637”.
In section 636 (amount of unprotected income that is undistributed for section 635 purposes)—
in subsection (2) (deducting payments that are or would be taxable as recipients’ income)—
in the words before paragraph (a) omit “such”,
in those words, for “as” substitute “that are payments of unprotected income, or sums treated as representing unprotected income, and that”, and
in paragraph (b), for “so treated” substitute “treated as mentioned in paragraph (a)”,
in subsection (4) (deducting expenses properly chargeable to income), before “income” insert “unprotected”, and
in subsection (6) (deducting amounts in respect of exempt income), in the definition of “A”, before “income” insert “unprotected”.
In section 637 (qualifications to section 636)—
in subsections (2), (3) and (4) (extent to which interest treated as deductible trust expenses), before “interest” insert “relevant”,
in subsection (5) (the relevant fraction), in the definition of “A”, before “income” insert “unprotected”, and
after subsection (7) insert—
After section 643 insert—
Section 16
Section 158 of ITA 2007 (form and amount of EIS relief) is amended as follows. In subsection (2)(a), after “EIS relief” insert “ (qualifying shares) ”. In subsection (2)(b), for “£1 million” substitute “ the allowable amount ”. After subsection (2) insert— In subsection (4), for “subsections (1) and (2)” substitute “ subsections (1) to (2ZB) ”. At the end insert—
Section 274 of ITA 2007 is amended as follows. The minimum investment on further issue condition The company has not breached and will not breach, in the relevant period, the minimum investment on further issue condition In subsection (3), after paragraph (f) insert—
After section 280B of ITA 2007 insert—
Section 17
Section 18
In ITTOIA 2005, after section 848 insert—
In CTA 2009, after section 1258 insert—
TMA 1970 is amended as follows. In section 12AA (partnership returns), after subsection (10A) insert— “partner” is to be construed in accordance with section 12AA(10B) of this Act;
The amendment made by paragraph 1 has effect in relation to the tax year 2018-19 and subsequent tax years. The amendment made by paragraph 2 has effect in relation to accounting periods beginning on or after 1 April 2018. The amendments made by paragraph 3 have effect in relation to partnership returns relating to the tax year 2018-19 or any subsequent tax year.
ITTOIA 2005 is amended as follows. In section 847 (general provisions), after subsection (3) insert— After section 852 insert— After section 855 insert— The amendments made by this paragraph have effect in relation to the tax year 2018-19 and subsequent tax years.
TMA 1970 is amended as follows. In section 12AA (partnership returns) after subsection (1A) insert— In section 12AB (partnership statements), after subsection (1) insert— “indirect partner”, in relation to the reporting partnership, is to be construed in accordance with section 12AA(1C); “reporting partnership” means the partnership to which the partnership statement referred to in subsection (1) relates; The amendments made by this paragraph have effect in relation to partnership returns relating to the tax year 2018-19 or any subsequent tax year.
F(No.2)A 2017 is amended as follows. In section 60, in paragraph 17 of Schedule A1 to be inserted into TMA 1970— In Schedule 14 (amendments relating to digital reporting etc), after paragraph 10 insert—
TMA 1970 is amended as follows. But see section 12ABZA. After section 12AB (partnership return to include partnership statement) insert— In section 98 (special returns, etc), in column 2 of the Table, at the appropriate place insert “ section 12ABZA(3) of this Act ”. The amendments made by this paragraph have effect in relation to returns—
In Schedule 14 to F(No.2)A 2017 (amendments relating to digital reporting etc), after paragraph 10A (as inserted by this Schedule) insert—
TMA 1970 is amended as follows. After section 12ABZA (as inserted by this Act) insert— In section 12ABA(1) (amendment of partnership return by taxpayer), after “partnership return” insert “ (including anything included in the return by virtue of section 12ABZB(7)(b) (amendment of partnership return following referral to tribunal)) ”. In section 12AC (enquiry into partnership return)— In section 12AD (amendment of partnership return by taxpayer during enquiry)— In section 28B(2)(b) (completion of enquiry into partnership return), after “return” insert “ (including anything included in the return by virtue of section 12ABZB(7)(b) (amendment of partnership return following reference to tribunal)) ”. In section 30B(1) (amendment of partnership return where loss of tax discovered), in the words after paragraph (c), after “return” insert “ (including anything included in the return by virtue of section 12ABZB(7)(b) (amendment of partnership return following reference to tribunal)) ”. In section 55 (recovery of tax not postponed)— In section 59B(5)(b) (payment of tax following amendment of self-assessment), after “section” insert “ 12ABZB(8), ”. In Schedule 3ZA (date by which payment to be made after amendment or correction of self-assessment), in paragraph 7 (amendment consequential on correction of partnership return by Revenue)—
In section 850 of ITTOIA 2005 (allocation of firm's profits or losses between partners), in subsection (1), after “850D” insert “ and section 12ABZB of TMA 1970 (partnership return is conclusive) ”.
In section 1262 of CTA 2009 (allocation of firm's profits or losses between partners), in subsection (1), after “1264A” insert “ and section 12ABZB of TMA 1970 (partnership return is conclusive) ”.
FA 2014 is amended as follows. In each of sections 220 and 221 (content of accelerated payment notice), at the end of subsection (3) insert “ (and disregarding any dispute which has been referred to a tribunal under section 12ABZB(3) of TMA 1970 but not yet determined) ”. In section 226 (penalty for failure to pay accelerated payment), after subsection (7) insert— In section 227 (withdrawal, modification or suspension of accelerated payment notice)— In Schedule 32 (accelerated payments and partnerships)—
The amendments made by paragraphs 10 to 13 have effect in relation to returns relating to the tax year 2018-19 or any subsequent tax year.
Schedule 14 to F(No.2)A 2017 (amendments relating to digital reporting etc) is amended as follows. After paragraph 10B (as inserted by this Schedule) insert— After paragraph 43 insert— In paragraph 46, at the end insert—
Section 23
In section 259IC(4) (counteraction where the hybrid entity is within the charge to corporation tax), for the words from “unless” to the end substitute unless it is deducted from—
The amendments made by paragraphs 2(b), 3 to 6 and 12— For the purposes of sub-paragraph (1)(a), (b) and (c)(ii), where there is a straddling period— A “straddling period” means an accounting period or payment period (as the case may be) beginning before 1 January 2018 and ending on or after that date. Part 6A of TIOPA 2010 has effect, and is to be deemed always to have had effect, with the amendments set out in paragraphs 2(a), 7 to 11 and 13 to 18.
In section 259B (“tax” means certain taxes on income and includes foreign tax etc)—
after subsection (3) insert—, and
at the end insert—
After section 259IC insert—
In section 259BC (meaning of “ordinary income”), in subsection (3), for the words from “it is excluded” to the end substitute—
In section 259FA (circumstances in which Chapter 6 applies), after subsection (7) insert—
In section 259GB (hybrid payee deduction/non-inclusion mismatches and their extent), in subsection (3)(b)(i), after “charged” insert “ at a higher rate than nil ”.
In section 259KB (meaning of “excessive PE deduction”), after subsection (4) insert—
Section 97 of TCGA 1992 (settlements: supplementary provisions) is amended as follows. or, In subsection (3) (cases where benefit may be treated as chargeable gain and as income), for “section 733 of ITA 2007 treated as the recipient’s” substitute “section 643A or 643J or 643L of ITTOIA 2005, or sections 731 to 733E of ITA 2007, treated as an individual’s”. In consequence of sub-paragraph (3), in Schedule 1 to ITA 2007 omit paragraph 302. The references to section 733A of ITA 2007 that are inserted by sub-paragraphs (2) and (3) include that section as it has effect for the tax year 2017-18.
Section 259BD (chargeable companies in respect of CFCs and foreign CFCs) is amended as follows. After subsection (12) insert— In subsection (13), in paragraph (b) of the definition of “chargeable profits”, after “Part” insert “ (including any qualifying CFC amount within the meaning given by subsection (12B)) ”.
But sub-paragraph (2) is subject to paragraph 53A (ring-fenced bodies).
After paragraph 53, insert—
The amendments made by this Schedule (other than those made by paragraphs 13 and 14(2), (3), (4)(a) and (5)(a)) have effect in relation to any land transaction of which the effective date is, or is after, 22 November 2017. But the amendments made by paragraph 2 do not have effect in relation to a transaction— A transaction effected in pursuance of a contract entered into before 22 November 2017 is excluded by this sub-paragraph if— The amendments made by paragraphs 13 and 14(2), (3), (4)(a) and (5)(a) have effect in relation to any land transaction in relation to which the amendment made by section 16(2) of the Wales Act 2014 (disapplication of UK stamp duty land tax) has effect.
In section 259GB (hybrid payee deduction/non-inclusion mismatches and their extent), after subsection (4) insert—
Section 433 (meaning of “qualifying infrastructure company”) is amended as follows. In subsection (1)(c), for “(see subsection (11))” substitute “(see subsections (11) and (12))”. In subsection (11)(a), for “activity that the company carries on” substitute “source of income that the company has”. After subsection (11) insert—
Section 434 (elections under section 433) is amended as follows. In subsection (1)(a), for “the beginning” substitute “the end”. In subsection (5), after paragraph (a) (but before the “and” at the end of it) insert—.
Section 436 (meaning of “qualifying infrastructure activity”) is amended as follows. In subsection (2)(d), for “(see subsection (10))” substitute “(see subsections (10) and (10A))”. After subsection (10) insert—
In section 443 (interest capacity for group with qualifying infrastructure company etc), for subsection (2) substitute—
In section 444 (joint venture companies), in subsection (1), after “a qualifying infrastructure company (“the joint venture company”)” insert “which is the ultimate parent of a worldwide group at all times in that period”.
Section 24
In section 378 (disallowed tax-interest expense amounts carried forward), in subsections (3) and (6), omit “the later accounting period or”.
In section 416 (meaning of “the group-EBITDA”), after subsection (2) insert—
Schedule 19 to FA 2011 (the bank levy) is amended as follows.
In section 393(5)(a) (amount of interest allowance for a period that is “available” in a later period), for “is made” substitute “has effect”.
Section 411 (meaning of “relevant expense amount” and “relevant income amount”) is amended as follows. In subsection (1)— In subsection (2)(f), after “debt factoring” insert “or any similar transaction”.
Section 412 (section 411: interpretation) is amended as follows. In subsection (1)— In subsection (6)—
Paragraph 9 of Schedule 7A (extended period for submission of full return in place of abbreviated return) is amended as follows. In sub-paragraph (1)(a), omit “abbreviated”. In sub-paragraph (2)— In the italic heading before that paragraph, for “in place of abbreviated return” substitute “for period where no restriction”.
Paragraph 70 of Schedule 7A (cases where company treated as amending return) is amended as follows. In sub-paragraph (1), for “is treated as having amended” substitute “must amend”. The amendment must be made before whichever is the later of— For the italic heading before that paragraph substitute “Other cases where company must amend its return etc”.
After paragraph 70 of Schedule 7A insert—
Paragraph 71 of Schedule 7A (regulations for purposes of paragraph 70 etc) is amended as follows. In sub-paragraph (1)(a), for “paragraph 70” substitute “paragraph 70(2)”. In the italic heading before that paragraph, for “paragraph 70” substitute “paragraph 70(2)”.
In section 9A of CTA 2010 (designated currency of a UK resident investment company), in subsection (7)—
in the definition of “financial statements of the group”, for “(within the meaning of section 351 of TIOPA 2010)” substitute “(and for this purpose “subsidiaries” has the meaning given by international accounting standards)”, and
for the definition of “Y’s group” substitute—.
The amendment made by paragraph 27 has effect in relation to elections that are made on or after 1 January 2018.
Section 33
The amendments made by Part 1, and by paragraphs 17 and 22 to 34 of Part 2, of this Schedule have effect in relation to chargeable periods ending on or after 1 January 2021.
The amendments made by paragraphs 18 and 19 of Part 2 of this Schedule have effect in relation to chargeable periods ending on or after 1 January 2018.
Section 35
“VCT income tax relief” means relief under Part 6 of ITA 2007 (venture capital trusts).
Chapter 2 of Part 13 of ITA 2007 (transfer of assets abroad) is amended as follows.
Section 731 (charge to tax on income treated as arising under section 732) is amended as follows. After subsection (1B) insert— In subsection (2A) (which signposts section 735), for “section 735” substitute “sections 735, 735B and 735C”.
In section 732(1)(e) (where benefit received, income treated as arising only if no tax on benefit apart from section 731)—
after “is not liable to income tax” insert “, under any provision that is none of section 731 of this Act and sections 643A, 643J and 643L of ITTOIA 2005,”, and
omit “(apart from section 731)”.
In section 733A(7) (meaning of “close member” of settlor’s family), for the words after “family of the settlor” substitute at any time if the settlor is living at that time and—
After section 733A insert—
In section 734 (amount charged under section 731 is reduced by prior gains)—
in subsection (1) omit paragraphs (b) and (c), but not the “and” at the end of paragraph (c),
for subsection (1)(d) substitute—, and
in subsection (4)—
for “and “the available relevant income” have” substitute “has”, and
for “Steps 2 and 5” substitute “Step 2”.
After section 734 insert—
After section 735B insert—
Subject as follows, the amendments made by paragraphs 3 to 19 have effect for the tax year 2018-19 and subsequent tax years. None of the references to an earlier tax year in Step 1 of the new section 643B(1) of ITTOIA 2005, or in new section 643C(2) of ITTOIA 2005, includes any tax year earlier than the tax year 2018-19 except that, in the phrase “benefits provided by the trustees in the year or in an earlier tax year” in the definition of “TOAA” in new section 643C(2) of ITTOIA 2005, the reference to an earlier tax year does include tax years earlier than the tax year 2018-19. New sections 643I to 643L and 643N of ITTOIA 2005 have effect only in relation to onward payments made on or after 6 April 2018. New section 643M of ITTOIA 2005, and new sections 733B to 733E and 735C of ITA 2007, have effect only in relation to onward payments made on or after 6 April 2018, but have effect in relation to an onward payment made on or after that date even where the onward payment is referable to a benefit received before that date. The amendment in section 733A(7) of ITA 2007 made by paragraph 15 also has effect for the tax year 2017-18.
After paragraph 7 insert—
But this paragraph does not apply if the trustee (or any of the trustees) of the settlement or bare trust concerned— in the exercise of powers conferred on the trustee by reason of a relevant court appointment made in respect of the child concerned. In sub-paragraph (1A) “relevant court appointment” means— Sub-paragraph (4) does not apply if the interest in the dwelling was acquired in the child’s name or on the child’s behalf by a person acting in exercise of powers conferred on that person by reason of a relevant court appointment made in respect of the child. In sub-paragraph (5A) “relevant court appointment” has the meaning given by paragraph 12(1B).
Schedule 36 to FA 2008 (information and inspection powers) is amended as follows. A person who under section 41 of FA 1996 is liable to pay landfill tax charged on a taxable disposal is treated for the purposes of this Schedule (subject to regulations under this paragraph) as carrying on a business. In paragraph 61A (involved third parties), in entry 12 of the table, for “landfill disposal” substitute “disposal of material”.
In section 47 of FA 1996 as it has effect following the amendments made by this Schedule— Where a person is registered under section 47 of FA 1996 immediately before the day on which this Act is passed, the registration continues after that day until terminated in accordance with that section (as amended by paragraph 17) or otherwise.
The new section 643D(3) of ITTOIA 2005 is to be treated as inserted by the Treasury under the powers to make regulations conferred by section 354 of TIOPA 2010.
Schedule 41 to that Act (penalties: failure to notify etc) is amended as follows. In the table in paragraph 1, in the entry for landfill tax, for “section 47(2) and (3)” substitute “section 47(2), (3) and (3A)”. After paragraph 3 insert— In paragraph 5 (degrees of culpability), in sub-paragraph (3), after “a relevant excise provision” insert “, or to assess an amount of landfill tax as due from P under section 50A of FA 1996,”. After paragraph 6C insert— In paragraph 7 (potential lost revenue)— After paragraph 9 insert—
Section 40
Schedule 4ZA to FA 2003 (stamp duty land tax: higher rates for additional dwellings and dwellings purchased by companies) is amended as follows.
Section 42
“EIS income tax relief” means relief under Part 5 of ITA 2007 (enterprise investment scheme);
Section 69 (taxable activities) is amended as follows. For subsection (1) substitute— In subsection (2)—
In section 42 (amount of tax), in subsection (2)—
for “Where the” substitute Where—;
this section
In section 51 (credit: general), in subsection (1)(a), after “liable to pay tax” insert “in respect of the disposal of material at a landfill site”.
In section 52 (bad debts), in subsection (1)(a), after “taxable activity” insert “at a landfill site”.
Omit sections 64 to 67.
Section 70 (interpretation) is amended as follows. In subsection (1), at the appropriate places insert—; ; ; Omit subsections (2) and (2A). In subsection (4), for “sections 64 to” substitute “sections 68 and”.
In section 71 (orders and regulations), in subsection (7)—
before paragraph (a) insert—;
omit paragraphs (ca), (cb) and (d).
Schedule 5 (landfill tax) is amended as follows. Omit paragraph 1B (information: site restoration). Before paragraph 2 insert— In paragraph 2A (records: material at landfill sites)— In paragraph 10 (power to take samples), in sub-paragraph (1) omit “as waste by way of landfill”. In paragraph 45 (adjustment of disposal contracts), in sub-paragraphs (1)(a) and (c) and (2) omit “landfill”. In paragraph 46 (adjustment of construction contracts), in sub-paragraph (1)(b) omit “landfill”.
Section 50 (power to assess) is amended as follows. In the heading, for “assess” substitute “assess: registered persons”. In subsection (1)(a), (b), (c) and (d) and subsection (2), for “a person” substitute “a registered person”.
In FA 2011, in Schedule 23 (data-gathering powers), in paragraph 25(c), for “landfill disposal” substitute “disposal of material”.
After that section insert—