November 2016 Plenary Meetings of the Permanent Council
In section 36 of the Alcoholic Liquor Duties Act 1979 (beer), as that section has effect apart from section 7(1) of the Finance Act 1991, for “£1.108” there shall be substituted “ £1.163 ”.
For the Table of rates of duty in Schedule 1 to that Act (wine and made-wine) there shall be substituted the Table in Schedule 1 to this Act.
In section 62(1) of that Act (cider) for “£21.32” there shall be substituted “ £22.39 ”.
This section shall be deemed to have come into force at 6 o’clock in the evening of 16th March 1993.
In section 36(1) of the Alcoholic Liquor Duties Act 1979 (beer duty), as substituted by section 7(1) of the Finance Act 1991, for “£10.60” there shall be substituted “ £10.45 ”.
This section shall be deemed to have come into force on 1st June 1993.
In section 1 of the Alcoholic Liquor Duties Act 1979 (alcoholic liquors dutiable under that Act) in subsection (3) (beer) for “1.2 per cent.” there shall be substituted “ 0.5 per cent. ”.
In section 36 of that Act (beer duty), as substituted by section 7(1) of the Finance Act 1991, after subsection (1) there shall be inserted the following subsection—
This section shall apply in relation to liquor which is produced in or imported into the United Kingdom, or removed into the United Kingdom from the Isle of Man, on or after the day on which this Act is passed.
The Alcoholic Liquor Duties Act 1979 shall be amended as follows.
In subsection (2) of section 42 (drawback on exportation etc. of beer)—
paragraph (a) (drawback on removal to excise warehouse) shall be omitted,
in paragraph (b) the words “or removal to the Isle of Man” shall be omitted,
also in paragraph (b) for “any such beer” there shall be substituted “ any beer to which this section applies ”, and
for “exported, removed or shipped” there shall be substituted “ exported or shipped ”.
In subsections (3) and (4) of that section the word “remove,”, in each place where it occurs, shall be omitted.
Section 43 (warehousing of beer for exportation, etc.) shall cease to have effect.
In section 45(1) (repayment of duty on beer used in the production or manufacture of other beverages etc.)—
at the end of paragraph (a) there shall be inserted “ or ”, and
paragraph (b) shall be omitted.
Section 51 (power to require production of books by brewers for sale) shall cease to have effect.
Subsections (2)(a) and (c) and (4) to (6) above shall come into force on 1st September 1993.
Subsections (2)(b) and (d) and (3) above shall come into force on such day as the Commissioners of Customs and Excise may by order made by statutory instrument appoint.
In Part VI of the Alcoholic Liquor Duties Act 1979 the following section shall be inserted before section 67—
In subsection (5) of section 55 of that Act (exemption for certain producers of made-wine from requirement to hold excise licence) before paragraph (a) there shall be inserted the following paragraph—.
In that section—
paragraph (e) of subsection (5) and the word “and” immediately preceding that paragraph shall be omitted, and
subsection (5A) shall be omitted.
This section shall apply in relation to the blending or other mixing of alcoholic liquors on or after the day on which this Act is passed.
In subsection (1) of section 58 of the Alcoholic Liquor Duties Act 1979 (mixing of wine and spirits in excise warehouse)—
for “6 litres” there shall be substituted “ 12 litres ”,
for “except as provided by subsection (2) below” there shall be substituted “ by virtue of this section ”, and
for “23 per cent.” there shall be substituted “ 22 per cent. ”.
Subsection (2) of that section shall be omitted.
This section shall apply in relation to mixing done on or after the day on which this Act is passed.
In Schedule 1 to the Alcoholic Liquor Duties Act 1979 (rates of duty on wine and made-wine), for paragraphs 1 and 2 there shall be substituted the following paragraphs—
This section shall apply in relation to wine and made-wine which is produced in or imported into the United Kingdom, or removed into the United Kingdom from the Isle of Man, on or after the day on which this Act is passed.
Denatured alcohol of such a description as may be specified in regulations made by the Commissioners of Customs and Excise shall not, if it would otherwise be so charged, be charged with any duty of excise under section 5 of the Alcoholic Liquor Duties Act 1979 (charge on spirits) on its importation into the United Kingdom from another member State.
The following references, namely— shall each be construed as including a reference to denatured alcohol of any description from time to time specified in regulations made for the purposes of subsection (1) above.
the references in sections 75, 77, 79 and 80 of that Act (regulation of methylated spirits) to methylated spirits;
the reference in section 77(1)(e) of that Act to spirits for methylation; and
the references in section 78 of that Act to methylated spirits or spirits (other than in the expression “duty payable on spirits”),
In this section “denatured alcohol” means any substance appearing to the Commissioners of Customs and Excise to fall within Article 27.1.(a) of the Directive of the Council of the European Communities dated 19th October 1992 No. 92/83/EEC (directive on the harmonisation of the structures of excise duties on alcohol and alcoholic beverages).
Any description of denatured alcohol specified in regulations under this section may be framed by reference to such circumstances or other factors, or to the approval or opinion of such persons (including the authorities in any member State), as may be so specified.
The power of the Commissioners of Customs and Excise to make regulations under this section shall be exercisable by statutory instrument subject to annulment in pursuance of a resolution of the House of Commons; and any such regulations may contain such transitional, supplemental and incidental provision as those Commissioners think fit.
In section 6(1) of the Hydrocarbon Oil Duties Act 1979 for “£0.2779” (duty on light oil) and “£0.2285” (duty on heavy oil) there shall be substituted “ £0.3058 ” and “ £0.2514 ” respectively.
In section 11(1) of that Act (rebate on heavy oil) for “£0.0095” (fuel oil) and “£0.0135” (gas oil) there shall be substituted “ £0.0105 ” and “ £0.0149 ” respectively.
In section 13A(1) of that Act (rebate on unleaded petrol) for “£0.0437” there shall be substituted “ £0.0482 ”.
In section 14(1) of that Act (rebate on light oil for use as furnace fuel) for “£0.0095” there shall be substituted “ £0.0105 ”.
This section shall be deemed to have come into force at 6 o’clock in the evening of 16th March 1993.
The Hydrocarbon Oil Duties Act 1979 (“the 1979 Act”) shall have effect in relation to such cases as may be specified in an order made by the Treasury as if references in that Act to hydrocarbon oil or to road fuel gas included references to any energy product which is designated by that order as a substance which is to be treated for the purposes of that Act as the equivalent of hydrocarbon oil or, as the case may be, of road fuel gas.
The Treasury may by order provide, in relation to any substance which by virtue of this section is to be treated for the purposes of the 1979 Act as the equivalent of hydrocarbon oil or road fuel gas, for that substance to be treated for the purposes of such of the provisions of that Act as may be specified in the order as if it fell within such class or description of substance as may be so specified.
heavy oil or light oil, as defined in section 1 of that Act;
aviation gasoline, as defined in section 6(4) of that Act;
fuel oil or gas oil, as defined in section 11(2) of that Act; and
unleaded petrol, as defined in section 13A(2) of that Act.
In exercising their powers under this section, the Treasury shall so far as practicable secure that an energy product which is intended for, or capable of being put to, a particular use is treated for the purposes of the 1979 Act as if it were the substance to which, when put to that use, it is most closely equivalent.
In this section “energy product” means a substance which—
is an energy product for the purposes of Council Directive 2003/ 96/EC restructuring the Community framework for the taxation of energy products and electricity, and
is not (apart from as a result of this section) hydrocarbon oil or road fuel gas within the meaning of the 1979 Act.
The power of the Treasury to make an order under this section shall be exercisable by statutory instrument subject to annulment in pursuance of a resolution of the House of Commons; and any such order may make different provision for different cases and different substances.
Where a duty of excise is charged on a substance under a provision of the 1979 Act by virtue of an order under this section, no duty shall be charged on the substance under any other provision of that Act.
After section 6 of the Hydrocarbon Oil Duties Act 1979 there shall be inserted the following section—
Sections 4, 7 and 16 of that Act (petrol substitutes and power methylated spirits) shall cease to have effect.
shall
In section 1(1)(b) of the Excise Duties (Surcharges or Rebates) Act 1979 (surcharges or rebates in respect of excise duties on hydrocarbon oil etc.), for paragraph (b) there shall be substituted the following paragraph—.
This section shall come into force on such day as the Treasury may by order made by statutory instrument appoint, and different days may be appointed under this subsection for different provisions and for different purposes.
In ascertaining for the purposes of the Hydrocarbon Oil Duties Act 1979— the volume of that liquid shall be taken (if it would not otherwise be so taken) to be what would be its volume, calculated in accordance with regulations under subsection (2) below, at a temperature of 15°C.
the amount of any duty of excise chargeable on any liquid by virtue of that Act; or
the amount of any rebate allowable on any such liquid by virtue of that Act,
The Commissioners of Customs and Excise may by regulations make such provision as they think fit as to the method by which, in ascertaining any amount mentioned in subsection (1) above— and that provision may include provision made by reference to any internationally recognised conversion tables.
the volume of any liquid is to be measured; or
the volume as at a temperature of 15°C of any amount of a liquid is to be determined;
Any reference in sections 15 and 17 to 19A of that Act (drawback and relief) to the amount of any duty of excise which has been paid in respect of any substance, or to the amount of any rebate that has been allowed in respect of any substance, shall be construed as a reference—
to such amount as is shown to the satisfaction of the Commissioners of Customs and Excise to have been paid or, as the case may be, allowed in respect of that substance; or
where regulations made by those Commissioners so provide, to such amount as is calculated on such assumptions as to the volume of the substance in question as may be determined in accordance with any such regulations.
The power of the Commissioners of Customs and Excise to make regulations under this section shall be exercisable by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament; and any such regulations—
may make different provision for different cases and for different substances; and
may contain such transitional, supplemental and incidental provision as those Commissioners think fit.
Provision made under this section by any regulations may provide for any determination or measurement under the regulations to be made, or any description of a case or substance to be framed, by reference to such circumstances or other factors, or to the opinion of such persons, as the Commissioners think fit.
For the purposes of this section “liquid” does not include any substance which is gaseous at a temperature of 15°C and under a pressure of 1013.25 millibars.
In consequence of this section—
section 2(5) of that Act (measurement of heavy oil having a temperature exceeding 15°C) shall cease to have effect; and
the words “shown to the satisfaction of the Commissioners to have been” in section 15(1) of that Act (drawback) shall be omitted.
This section shall come into force on such day as the Commissioners of Customs and Excise may by order made by statutory instrument appoint, and different days may be appointed under this subsection for different provisions and for different purposes.
1. Cigarettes An amount equal to 20 per cent. of the retail price plus £48.75 per thousand cigarettes. 2. Cigars £72.30 per kilogram. 3. Hand-rolling tobacco £76.29 per kilogram. 4. Other smoking tobacco and chewing tobacco £31.93 per kilogram.
This section shall be deemed to have come into force at 6 o’clock in the evening of 16th March 1993.
In the Tobacco Products Duty Act 1979, section 1 (definition of tobacco products) shall be amended as follows.
In subsection (2) (definition of hand-rolling tobacco) after paragraph (a) there shall be inserted—.
In paragraph (b) of subsection (2) (more than 25 per cent. by weight of the tobacco particles have a width of less than 0.6 mm) for “0.6” there shall be substituted “ 1 ”.
The following subsection shall be inserted after subsection (2)—
In subsection (3) (power to amend definitions) after “(2)” there shall be inserted “ or (2A) ”.
The Tables set out in section 23(1) of the Betting and Gaming Duties Act 1981 shall be amended as follows—
in Table A for “£375” there shall be substituted “£450”;
in Table B for “£375” there shall be substituted “£450” and for “£960” there shall be substituted “£1,150”.
This section shall apply in relation to licences for any period beginning on or after 1st May 1993.
The Betting and Gaming Duties Act 1981 shall be amended as follows.
In section 21 (gaming machine licences) in subsection (1) (licence required for machine other than a two-penny machine) for “a two-penny machine” there shall be substituted “ an excepted machine ”.
In that section the following subsection shall be inserted after subsection (3)—
In section 22 (charge to duty)—
in subsection (1) for the words from “by reference” to the end of the subsection there shall be substituted “ in accordance with section 23 below ”;
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For subsection (4) of section 25 (meaning of “gaming machine”) there shall be substituted the following subsections—
“five-penny machine” means a gaming machine which can only be played by the insertion into the machine of a coin or coins of a denomination, or aggregate denomination, not exceeding 5p;
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This section shall apply in relation to licences for any period beginning on or after 1st November 1993.
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in the second column of paragraph 2 (bicycles exceeding 150 cc but not exceeding 250 cc) for “30.00” there shall be substituted “35.00”;
in the second column of paragraph 3 (bicycles exceeding 250 cc) for “50.00” there shall be substituted “55.00”;
in the second column of paragraph 5 (tricycles exceeding 150 cc) for “50.00” there shall be substituted “55.00”.
In Schedule 2 (annual rate of duty on hackney carriages) in the Table set out in Part II—
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in the second column of paragraph 1 (special machines) for “30.00” there shall be substituted “35.00”;
in the second column of paragraph 2 (showmen’s haulage vehicles) for “90.00” there shall be substituted “100.00”;
in the second column of paragraph 4 (recovery vehicles) for “75.00” there shall be substituted “85.00”.
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in sub-paragraph (1) for “£75” there shall be substituted “£85”;
in sub-paragraphs (2)(a), (2)(b) and (4) for “£90” (in each place) there shall be substituted “£100”.
In Schedule 5 (annual rate of duty on vehicles not falling within Schedules 1 to 4) in the Table set out in Part II—
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The Vehicles (Excise) Act 1971 shall be amended as follows.
In paragraph 2 of Schedule 4A (annual rates of duty on vehicles used for carrying or drawing exceptional loads) for “£3,250” there shall be substituted—
“£4,250” in relation to licences taken out after 16th March 1993 and before the appointed day;
“£5,000” in relation to licences taken out on or after the appointed day.
In this section “the appointed day” means such day as the Secretary of State may appoint by order made by statutory instrument.
The Vehicles (Excise) Act 1971 shall be amended as follows.
In subsection (5) of section 16 (rates of duty for trade licences) including that subsection as set out in paragraph 12 of Part I of Schedule 7—
for “£100” there shall be substituted “the rate mentioned in subsection (5A)(a) below”, and
for “£20” there shall be substituted “the rate mentioned in subsection (5A)(b) below”.
In that section the following subsection shall be inserted after subsection (5)—
This section shall apply in relation to licences taken out after 16th March 1993.
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The Secretary of State may by order make such modifications of Schedule 4 to the Vehicles (Excise) Act 1971 (annual rates of duty on goods vehicles) as he thinks fit for the purpose of securing—
that the annual rates of duty applicable in accordance with that Schedule are expressed by reference to fewer tables; and
that the tables which in pursuance of any order under this section are set out in that Schedule have effect in different cases subject to the operation of such multipliers as may be appropriate.
An order under this section—
shall be made by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament; and
may contain such incidental and consequential provision (including provision modifying any enactment) as the Secretary of State thinks fit.
Nothing in this section shall authorise any increase by order of the annual rate of duty chargeable in respect of any vehicle.
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In subsection (1) of section 17 of the Finance Act 1980 (extension of mutual recovery provisions to VAT), at the end there shall be inserted “and to excise duties by the Directive of the Council of the European Communities dated 14th December 1992 No. 92/108/EEC.”
In subsection (2)(a) of that section (extension of mutual disclosure provisions to VAT), after “No. 79/1070/EEC” there shall be inserted “and to excise duties by the Directive of the Council of the European Communities dated 25th February 1992 No. 92/12/EEC.”
After subsection (2) of that section there shall be inserted the following subsection—
Subsection (1) above shall have effect as respects a request for the recovery of a sum only if it is a sum becoming due on or after the day on which this Act is passed.
Where an application is made for a licence under the Vehicles (Excise) Act 1971 for a vehicle which— he may refuse to issue the licence unless subsection (2) below applies to the vehicle.
appears to the Secretary of State to have been removed into the United Kingdom from a place outside the United Kingdom; and
is not already registered under that Act,
This subsection applies to a vehicle if the Secretary of State is satisfied in relation to the removal of that vehicle into the United Kingdom—
that any value added tax charged on the acquisition of that vehicle from another member State, or on any supply involving its removal into the United Kingdom, has been or will be paid or remitted;
that any value added tax or customs duty charged on the importation of the vehicle from a place outside the member States has been or will be paid or remitted; or
that no such tax or duty has been charged on the acquisition or importation of the vehicle or on any supply involving its removal into the United Kingdom.
This section shall have effect in relation to any application made on or after the day on which this Act is passed.
Subject to subsections (3) and (4) below, a duty of excise called “lottery duty” is chargeable—
on the taking in the United Kingdom of a ticket or chance in a lottery, and
in such cases as may be determined by regulations, on the taking outside the United Kingdom of a ticket or chance in a lottery promoted in the United Kingdom.
Regulations may make provision for determining when and where the taking of a ticket or chance in a lottery is to be treated as occurring for the purposes of this Chapter.
Lottery duty is not chargeable in respect of a lottery that constitutes a game of bingo (or any version of bingo, by whatever name called).
Lottery duty is not chargeable (in Great Britain) in respect of a lottery which is an exempt lottery within the meaning of the Gambling Act 2005 (see section 258) or is promoted under and operated in accordance with a lottery operating licence under Part 5 of that Act or (in Northern Ireland) in respect —
of a lottery promoted as an incident of an exempt entertainment within the meaning of ... the Betting, Gaming, Lotteries and Amusements (Northern Ireland) Order 1985;
of a private lottery within the meaning of that ... Order;
of a society’s lottery within the meaning of that ... Order in respect of which the conditions set out in ... Article 135(1) of that Order are satisfied;
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The Treasury may by order amend subsection (4) above so as to add to the descriptions of lottery for the time being mentioned in that subsection, so as to omit any of them or so as to substitute a different description of lottery for any of them.
The amount of the lottery duty chargeable on the taking of a ticket or chance in a lottery is equal to 12 per cent. of the value of the consideration given for the ticket or chance.
Subject to subsection (3) below, the aggregate of everything paid or given by (or debited to the account of) the person taking the ticket or chance for, on account of, or in connection with, the ticket or chance shall be taken to be the consideration given for it.
If a price is shown on a lottery ticket or any other document providing evidence of the taking of a ticket or chance in a lottery and— consideration to the value of the price shown shall be taken to be given for the ticket or chance.
the consideration given for the ticket or chance is of lesser value than the price shown (or is of no value), or
no consideration is given for the ticket or chance,
The lottery duty chargeable on the taking of a ticket or chance in a lottery becomes due and (subject to any regulations under subsection (2) below) payable at the time the ticket or chance is taken.
Regulations may provide for the payment of any lottery duty due in respect of a lottery of a description specified in the regulations to be deferred, subject to any conditions or requirements that may be imposed by or under the regulations.
Regulations may require payments (of amounts determined by or under the regulations) to be made on account of any lottery duty that may become due in respect of a lottery of a description specified in the regulations that is being or is to be promoted.
Any lottery duty or payment on account of lottery duty that under section 26 above or regulations under that section is payable in respect of a lottery shall be paid (subject to any regulations under subsection (2) below) by the promoter of the lottery.
Regulations may require any lottery duty or payment on account of lottery duty that is payable in respect of a lottery of a description specified in the regulations to be paid by a person specified in the regulations (being a person who occupies or has occupied a position of responsibility in relation to the lottery) instead of by the promoter.
Any lottery duty that is payable in respect of a lottery may be recovered jointly and severally from—
the promoter of the lottery,
any other person who occupies or has occupied a position of responsibility in relation to the lottery or who has or has had any degree of control over any of its proceeds, and
where the promoter or a person within paragraph (b) above is a body corporate, any director of that body corporate.
Where a persondoes not make a payment that he is required to make by subsection (1) above or regulations under subsection (2) above at the time the payment becomes payable his failure so to make the payment shall attract a penalty under section 9 of the Finance Act 1994 (civil penalties) which shall be calculated by reference to the amount which has not been paid and shall also attract daily penalties..
Lottery duty shall be under the care and management of the Commissioners.
Regulations may provide for any matter for which provision appears to the Commissioners to be necessary or expedient for the administration or enforcement of lottery duty or for the protection of the revenue derived from lottery duty.
Where a person contravenes or does not comply with any regulations under subsection (2) above his contravention or failure to comply shall attract a penalty under section 9 of the Finance Act 1994 (civil penalties)..
A lottery in respect of which lottery duty is chargeable (or, on the taking of a ticket or chance, will be chargeable) shall not be promoted in the United Kingdom unless the chargeable person is registered with the Commissioners under this section.
In this section “the chargeable person”, in relation to a lottery, means—
subject to paragraph (b) below, the promoter of the lottery;
in the case of a lottery of a description specified in regulations under section 27(2) above, the other person referred to in that subsection.
Regulations may make provision—
as to the time at which an application for registration is to be made, as to the form and manner of such an application and as to the information to be contained in or provided with it,
as to the requirements that must be satisfied as a condition of a person’s registration or continued registration, and
as to other requirements that must be observed by a person while he remains registered.
The requirements imposed by virtue of subsection (3)(b) above may include requirements as to the giving of security or further security (by means of a deposit or otherwise) for any lottery duty that may become due.
Subject to regulations under subsection (3)(a) and (b) above, the Commissioners—
shall register any person applying to them for registration who satisfies them that he will be the chargeable person in relation to a lottery that is to be promoted, and
shall not remove any person from the register unless it appears to them that no lottery is being or is to be promoted in relation to which he is or will be the chargeable person.
Where— they shall not remove him from the register until the promotion of that lottery has come to an end.
the Commissioners determine that a person should be removed from the register because any requirement imposed by regulations under subsection (3)(b) above is not (or is no longer) satisfied in relation to him, and
a lottery in relation to which he is the chargeable person is being promoted at the time they make that determination,
If subsection (1) above is contravened in relation to a lottery at any time during its promotion, the chargeable person is guilty of an offence and liable—
on summary conviction, to a penalty of £20,000 or to imprisonment for a term not exceeding six months, or to both, or
on conviction on indictment, to a penalty of any amount or to imprisonment for a term not exceeding two years, or to both.
Where a person contravenes or fails to comply with any requirements imposed by regulations under subsection (3)(c) above his contravention or failure to comply shall attract a penalty under section 9 of the Finance Act 1994 (civil penalties).
Section 1(1) of the Customs and Excise Management Act 1979 (interpretation) shall be amended in accordance with subsections (2) and (3) below.
In the definition of “the revenue trade provisions of the customs and excise Acts”—
the word “and” at the end of paragraph (b) shall be omitted, and
at the end there shall be added; and .
In paragraph (a) of the definition of “revenue trader”—
the word “or” at the end of sub-paragraph (i) shall be omitted,
after sub-paragraph (i) there shall be inserted—, and
in sub-paragraph (ii) after “activities” there shall be inserted “ as are mentioned in sub-paragraph (i) or (ia) above ”.
In section 117 of the Customs and Excise Management Act 1979 (execution and distress against revenue traders) after subsection (1) there shall be inserted—
A person who is knowingly concerned— is guilty of an offence.
in the fraudulent evasion (by him or another person) of lottery duty, or
in taking steps with a view to such fraudulent evasion,
A person guilty of an offence under subsection (1) above is liable—
on summary conviction, to a penalty of £20,000 or, if greater, treble the amount of the duty evaded or sought to be evaded or to imprisonment for a term not exceeding six months, or to both, or
on conviction on indictment, to a penalty of any amount or to imprisonment for a term not exceeding 14 years, or to both.
A person who in connection with lottery duty— is guilty of an offence.
makes a statement that he knows to be false in a material particular or recklessly makes a statement that is false in a material particular, or
with intent to deceive, produces or makes use of a book, account, return or other document that is false in a material particular,
A person guilty of an offence under subsection (3) above is liable—
on summary conviction, to a penalty of £20,000 or to imprisonment for a term not exceeding six months, or to both, or
on conviction on indictment, to a penalty of any amount or to imprisonment for a term not exceeding two years, or to both.
Where an offence under this Chapter is committed by a body corporate, every person who at the date of the commission of the offence is a director, manager, secretary or other similar officer of the body corporate (or is purporting to act in such a capacity) is also guilty of the offence unless—
the offence is committed without his consent or connivance, and
he has exercised all such diligence to prevent its commission as he ought to have exercised, having regard to the nature of his functions in that capacity and to all the circumstances.
Where a person has committed an offence under section 31(1) or (3) above, any goods used in the promotion of, or in any other way related to, a relevant lottery are liable to forfeiture.
In subsection (1) above “relevant lottery”—
in relation to an offence under section 31(1) above, means a lottery in respect of which lottery duty was fraudulently evaded or (as the case may be) in respect of which the fraudulent evasion of lottery duty was sought, and
in relation to an offence under section 31(3) above, means a lottery to which the false statement or (as the case may be) false document related.
Where a person takes an action in pursuance of instructions of the Commissioners given in connection with the enforcement of this Chapter or of regulations under it and, apart from this section, the person would in taking that action be committing an offence under any enactment relating to lotteries, he shall not be guilty of that offence.
A certificate of the Commissioners— is sufficient evidence of that fact until the contrary is proved.
that a person was or was not, at any date, registered under section 29 above,
that any return required by regulations under this Chapter had not been made at any date, or
that any lottery duty shown as due in a return made in pursuance of such regulations or in an estimate made under section 116A of the Customs and Excise Management Act 1979 had not been paid at any date,
A photograph of any document furnished to the Commissioners for the purposes of this Chapter and certified by them to be such a photograph is admissible in any proceedings, whether civil or criminal, to the same extent as the document itself.
Any document purporting to be a certificate under subsection (1) or (2) above shall be taken to be such a certificate until the contrary is proved.
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Notwithstanding any obligation not to disclose information that would otherwise apply, the Commissioners may disclose information— for the purpose of assisting the Secretary of State or Gambling Commission (as the case may be) in the performance of duties imposed by or under any enactment in relation to lotteries.
to the Secretary of State,
to the Gambling Commission, or
to an authorised officer of the Secretary of State or Gambling Commission,
Notwithstanding any such obligation as is mentioned in subsection (1) above— may disclose information to the Commissioners or to an authorised officer of the Commissioners for the purpose of assisting the Commissioners in the performance of duties in relation to lottery duty.
the Secretary of State,
the Gambling Commission , or
an authorised officer of the Secretary of State or Gambling Commission,
Information that has been disclosed to a person by virtue of this section shall not be disclosed by him except—
to another person to whom (instead of him) disclosure could by virtue of this section have been made, or
for the purpose of any proceedings connected with the operation of any enactment in relation to lotteries or lottery duty.
References above in this section to the Secretary of State include any person who has been designated by the Secretary of State as a person to and by whom information may be disclosed under this section.
The Secretary of State shall notify the Commissioners in writing if he designates a person under subsection (4) above.
Any regulations under this Chapter may make—
different provision for different cases or circumstances, and
incidental, supplemental or consequential provision.
Any power to make regulations or orders under this Chapter is exercisable by statutory instrument.
Subject to subsection (4) below, a statutory instrument containing such regulations or an order under section 24(5) above is subject to annulment in pursuance of a resolution of the House of Commons.
An order under section 24(5) above that will result in lottery duty becoming chargeable in respect of any description of lottery shall not be made unless a draft of the statutory instrument containing it has been laid before, and approved by a resolution of, the House of Commons.
In section 6 of the Betting and Gaming Duties Act 1981 (pool betting duty)—
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subsection (4) shall cease to have effect.
In this Chapter—
“the High Level Stop Loss Fund” means the fund of that name which, under the rules of Lloyd’s, has been established for the year 1993 and subsequent underwriting years;
“the relevant year of assessment” means—
a limited partnership formed under the law of Scotland which is a member of Lloyd’s and is or has been an underwriting member, or
“promotion”, in relation to a lottery, includes the conduct of the lottery (and “promoted” is to be read accordingly), and
“commercial woodlands” means woodlands in the United Kingdom which are managed on a commercial basis and with a view to the realisation of profits.
Section 1.
Description of wine or made-wine Rates of duty per hectolitre £ Wine or made-wine of a strength not exceeding 2 per cent. 13.23 Wine or made-wine of a strength exceeding 2 per cent. but not exceeding 3 per cent. 22.04 Wine or made-wine of a strength exceeding 3 per cent. but not exceeding 4 per cent. 30.86 Wine or made-wine of a strength exceeding 4 per cent. but not exceeding 5 per cent. 39.69 Wine or made-wine of a strength exceeding 5 per cent. but not exceeding 5.5 per cent. 48.50 Wine or made-wine of a strength exceeding 5.5 per cent. but not exceeding 15 per cent. and not being sparkling 132.26 Sparkling wine or sparkling made-wine of a strength exceeding 5.5 per cent. but not exceeding 15 per cent. 218.40 Wine or made-wine of a strength exceeding 15 per cent. but not exceeding 22 per cent. 220.43
Description of wine or made-wine Rates of duty per litre of alcohol in the wine or made-wine £ Wine or made-wine of a strength exceeding 22 per cent. 19.81
Section 49.
In subsection (2) of section 14 of the 1985 Act (penalty for misdeclaration or neglect imposed where the tax lost equals or exceeds certain amounts), for paragraphs (a) and (b) there shall be substituted “ equals or exceeds whichever is the lesser of £1,000,000 and 30 per cent. of the relevant amount for that period. ” After subsection (4) of that section there shall be inserted the following subsections— In subsection (5A) of that section (account to be taken of corrections), for “subsection (5) above that the statement made by each of those returns is a correct statement” there shall be substituted “ subsections (4B) and (5) above that the statements made by each of those returns (so far as they are not inaccurate in any other respect) are correct statements ”. This paragraph shall have effect in relation to any prescribed accounting period beginning on or after such day as the Treasury may by order made by statutory instrument appoint, but an order under this sub-paragraph may appoint different days for the purposes of different provisions of this paragraph or for different purposes.
In subsection (1)(b) of section 14A of the 1985 Act (misdeclaration resulting in understatements or overclaims), for the words from “whichever” to “period” there shall be substituted “ whichever is the lesser of £500,000 and 10 per cent. of the gross amount of tax for that period ”. For subsections (2) and (3) of that section (liability for penalty where there are misdeclarations on three or more occasions) there shall be substituted the following subsections— In subsection (4) of that section, for “subsections (4) to (5B)” there shall be substituted “ subsections (4), (4B), (5A) and (5B) ”. In subsection (6) of that section (material inaccuracies not to be material in cases to which other sections apply), at the end there shall be inserted “ except, in the case of an inaccuracy by reason of which a person is assessed to a penalty under section 14 above, for the purposes of subsection (2)(a) above. ” Subject to sub-paragraph (6) below, this paragraph shall have effect in relation to any prescribed accounting period beginning on or after such day as the Treasury may by order made by statutory instrument appoint. No penalty liability notice shall be served on or after the day appointed under sub-paragraph (5) above by reference to any material inaccuracy in respect of a prescribed accounting period beginning before that day, and the penalty period specified in any penalty liability notice served before that day shall be deemed to end with the day before that day.
After section 15 of the 1985 Act there shall be inserted the following section— Subsection (4) of section 13 of the 1985 Act (mitigation of penalty under section 13) shall cease to have effect; and— This paragraph shall have effect in relation to any penalty under section 13, 14, 14A or 15 of the 1985 Act, other than one to which any person was assessed before the day on which this Act is passed.
In subsections (1) and (3) of section 18 of the 1985 Act (interest on tax etc. recovered or recoverable by assessment), after the word “shall”, in each subsection, there shall be inserted “ (subject to subsection (3A) below) ”. After subsection (3) of that section there shall be inserted the following subsection— This paragraph shall apply in relation to interest on amounts assessed or, as the case may be, paid on or after such day as the Treasury may by order made by statutory instrument appoint.
In section 19 of the 1985 Act, in subsection (2) (surcharge liability notice if default for two accounting periods)— In subsection (3) of that section for “defaults in respect of two prescribed accounting periods and the second of those periods” there shall be substituted “ a default in respect of a prescribed accounting period and that period ”. This paragraph shall apply in relation to any case where a person is in default for the purposes of section 19 of the 1985 Act and is so in default because of a failure of the Commissioners of Customs and Excise to receive a return, or an amount of tax, on or before a day falling on or after 1st October 1993; and in the case of sub-paragraph (2) above it is immaterial when the existing surcharge period began.
For subsection (4) of section 19 of the 1985 Act (amount of surcharge) there shall be substituted the following subsection— In subsection (5) of that section (specified percentages for default surcharge)— After subsection (5) of that section there shall be inserted the following subsection— This paragraph shall apply in relation to any case where a person—
In subsection (5) of section 19 of the 1985 Act (specified percentages for default surcharge)— Sub-paragraph (1) above shall apply in relation to any liability to a surcharge arising on or after 1st April 1993. In section 19(5) of the 1985 Act (as amended by sub-paragraph (1) above), for paragraphs (a) to (c) there shall be substituted the following paragraphs— Sub-paragraph (3) above shall apply in relation to any liability to a surcharge arising on or after 1st October 1993.
In this Schedule “the 1985 Act” means the Finance Act 1985.
Section 72.
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Section 73.
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after “car”, in each place where it occurs, there shall be inserted “or van”, and
after “section 157” there shall be inserted “or 159AA”.
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after “car”, in each place where it occurs, there shall be inserted “or van”, and
after “section 157” there shall be inserted “or 159AA”.
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Section 76.
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Section 79.
In each of sections 167(2A), . . ., . . . and 819(2) of the Taxes Act 1988 (definitions of excess liability), and in the definition of “excess liability” in paragraph 19(1) of Schedule 7 to that Act, for “were charged at the basic rate” there shall be substituted “ by virtue of section 1(2)(aa) were charged at the basic rate, or (so far as applicable in accordance with section 207A) the lower rate, ”.
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In each of sections 68(2)(c) and 71(4)(c) of the Finance Act 1989 . . . (which contain references to a rate equal to the sum of the basic rate and the additional rate), for the words from “a rate” to “additional rate” there shall be substituted “ the rate applicable to trusts ”.
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This Schedule, except the provisions to which sub-paragraphs (2) to (5) below apply, shall have effect for the year 1993-94 and subsequent years of assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 87.
In sections 157 and 163 to 165 of the Taxation of Chargeable Gains Act 1992 and in paragraph 12(2) of Schedule 6 and paragraph 7(1) of Schedule 7 to that Act (which contain provisions relating to retirement relief and provisions which apply the definition of “family company” in Schedule 6 for other purposes), for the words “family company”, wherever they occur, there shall be substituted “ personal company ”. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
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After Chapter I of Part V of that Act there shall be inserted the following Chapter—
Section 88. The following is the Schedule to be inserted after Schedule 7 to the Taxation of Chargeable Gains Act 1992.
Section 97.
The following Schedule shall be inserted after Schedule 19AB to the Taxes Act 1988—
Where immediately before the relevant day the company referred to in section 11(2) of the Taxes Act 1988 is an overseas life insurance company, then, subject to sub-paragraph (4) below, it shall be deemed for the purposes of corporation tax on chargeable gains— at its market value at the time of the deemed disposal. This sub-paragraph applies to any asset which— For the purposes of sub-paragraph (2) above an asset is at the beginning of the relevant day a chargeable asset in relation to the company if, were it to be disposed of at that time, any chargeable gains accruing to the company on the disposal would form part of its chargeable profits by virtue of paragraph (c), (d) or (e) of section 11(2) of the Taxes Act 1988 (as that paragraph has effect by virtue of Schedule 19AC to that Act). Sub-paragraph (1) above shall not have effect in applying paragraph 2(2) of Schedule 28 to that Act in the case of a disposal by the company. For the purposes of this paragraph the relevant day is the first day of the company’s first accounting period to begin after 31st December 1992.
Section 101. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Section 102. . . . . . . . . . . . .
Section 114.
The Capital Allowances Act 1990 shall be amended as follows.
In subsection (1) of section 124 (expenditure qualifying for allowances)— In subsection (2) of that section, for “this Part” there shall be substituted “ writing-down allowances ”.
After section 124 there shall be inserted the following sections—
In subsection (1) of section 126 (transfers of relevant interest), for “a writing-down allowance” there shall be substituted “ an allowance under this Part ”. For subsection (2) of that section there shall be substituted the following subsection— In subsection (6) of that section (balancing increase of last writing-down allowance in respect of allowance lost on transfers), after “total allowances” there shall be inserted “ (including any initial allowance) ”.
After subsection (3) of section 127 (buildings etc. bought unused) there shall be inserted the following subsections— In subsection (4) of that section, for “and (3)” there shall be substituted “ (3) and (3B) ”.
After section 127 there shall be inserted the following section—
In subsection (1) of section 128 (balancing allowances and charges), for “a writing-down allowance” there shall be substituted “ an allowance under this Part ”. In subsection (2) of that section, for “this Part less the aggregate of any writing-down allowances” there shall be substituted “ any allowances under this Part less the aggregate of any such allowances ”. In subsection (3) of that section, after “purposes of” there shall be inserted “ allowances under ”. In subsection (6) of that section, for “writing-down allowances” there shall be substituted “ allowances under this Part ”.
In section 129(1) (balancing events), for “a writing-down allowance” there shall be substituted “ an allowance under this Part ”.
In section 131(2) (application of Chapter I of Part V to forestry buildings etc.), in the words after paragraph (b), before “subject” there shall be inserted “ with the omission of sections 124A, 127(3A)(b) and 127A and ”.
In section 146(3) (allowances under Parts V and VI not to exceed expenditure), after “made under” there shall be inserted “ Part V or ”.
Section 115.
The Capital Allowances Act 1990 shall be amended as follows.
In section 23(6) (interpretation of information provisions relating to first-year allowances), at the end there shall be inserted “ and references in this section to a first-year allowance shall not include references to a first-year allowance in respect of expenditure to which section 22 applies by virtue only of subsection (3B) of that section. ”
In section 30(2)(c) (special provision for ships), for “section” there shall be substituted “ sections 46(8)(e) and ”.
In section 38(m) (assets attracting first-year allowances not to be treated as short-life assets), after “section 22” there shall be inserted “ (2), (3) or (3A) ”.
In subsection (2)(a) of section 39 (definition of a qualifying purpose), for “subsections (2) and (3)” there shall be substituted “ subsections (2) to (3B) ”. In subsection (8)(b) of that section (anti-avoidance provision in respect of chartering), after “new expenditure,” there shall be inserted “ a first-year allowance by virtue of section 22(3B) or ”.
After subsection (8) of section 42 (modifications in relation to “old expenditure” of provisions relating to overseas leasing) there shall be inserted the following subsection—
In subsection (1) of section 43 (cases where section applies), for “This section” there shall be substituted “ Subsections (2) and (3) below ”. After subsection (3) of that section there shall be inserted the following subsection—
In section 44 (further provisions in relation to joint lessees in cases involving new expenditure), after subsection (4) there shall be inserted the following subsection—
In section 46 (recovery of allowances made in respect of plant and machinery subsequently let to a foreign resident), after subsection (7) there shall be inserted the following subsection—
In section 48 (information provisions in relation to joint lessees in cases involving new expenditure), after subsection (6) there shall be inserted the following subsection—
In subsection (3) of section 50, in paragraph (i) of the definition of “old expenditure” (old expenditure to include expenditure falling within section 22) after “22” there shall be inserted “ other than expenditure to which that section applies by virtue only of subsection (3B) of that section ”. After subsection (4) of that section there shall be inserted the following subsection—
In section 81 (assets used for purposes not attracting capital allowances and assets received by way of gift), after subsection (1) there shall be inserted the following subsection— After subsection (2) of that section there shall be inserted the following subsection— Sub-paragraph (2) above shall have effect in cases where machinery or plant is brought into use on or after 14th April 1993.
In subsection (1)(a) of section 147 (exclusion of double allowances), after “those Parts” there shall be inserted “ or section 22 ”. In subsection (2) of that section, after “any person” there shall be inserted “ an allowance is made under section 22 in respect of any capital expenditure or ”.
Section 120.
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Section 86 of that Act of 1970 (interest on overdue tax) shall be amended as follows. In subsection (3)(b), for “subject to subsection (3A)” there shall be substituted “ subject to subsections (3A) and (4A) ”. In subsection (3A), at the beginning there shall be inserted “ Subject to subsection (4A) below, ”. After subsection (4) there shall be inserted the following subsections—
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In section 91(1B) of that Act of 1970 (subsection (1A) subject to section 87A(4)), after “section 87A(4)” there shall be inserted “ (6) and (7) ”.
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In section 108(1) of that Act of 1970 (which includes provision requiring companies to act for the purposes of the Taxes Acts through their proper officers), after “proper officer of the company” there shall be inserted “ or, except where a liquidator has been appointed for the company, through such other person as may for the time being have the express, implied or apparent authority of the company to act on its behalf for the purpose ”.
In relation to any case in which by virtue of section 99 of the Finance Act 1990 losses may be set off under subsection (1) of section 393 or of section 396 of the Taxes Act 1988 without the making of a claim, the Taxes Act 1988 shall have effect with the following amendments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . In section 398 (transactions in deposits), for the words from “he may” onwards there shall be substituted “ the amount of his loss may be set off in pursuance of a claim under section 392 or, as the case may be, against which the amount of his loss may be set off under section 396 ”. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
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Section 134.
This paragraph applies where regulations under this Schedule provide that the amount of an initial exchange gain or initial exchange loss accruing to a company as regards an asset, liability or contract for an accrual period shall be found in accordance with the alternative method of calculation. In such a case the amount shall not be found in accordance with section 125(2) or (4) of this Act or section 126(3) or (5) or section 127(3) or (4) (as the case may be) but shall be found by— Subject to regulations under this Schedule, the accrued amount for a day in the accrual period shall be found by— Where an accrual period does not begin at the beginning of a day, the part of the day that falls within the accrual period shall be treated for the purposes of this Schedule as a complete day. Where an accrual period does not end at the end of a day, the part of the day that falls within the accrual period shall be treated for the purposes of this Schedule as a complete day.
Regulations may provide that where— the amount of the gain or loss shall be found in accordance with the alternative method of calculation. Regulations may also provide that as regards any such day as is mentioned in sub-paragraph (1) above the accrued amount shall be ascertained in accordance with prescribed rules. Regulations may be so framed that the accrued amount as regards a day depends on the extent to which an asset or contract is held, or a liability is owed, in exempt circumstances. For the purposes of this paragraph an asset or contract is held, or a liability is owed, in exempt circumstances at a given time if it is then held or owed— In this paragraph— “long-term insurance business” means business which consists of the effecting or carrying out of contracts which fall within Part II of Schedule 1 to the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001;
Regulations may provide that where— the amount of the gain or loss shall be found in accordance with the alternative method of calculation. Regulations may also provide that as regards any such day as is mentioned in sub-paragraph (1) above the accrued amount shall be ascertained in accordance with prescribed rules. Regulations may be so framed that the accrued amount as regards a day depends on the extent to which the income represented by an asset is unremittable. For the purposes of this paragraph income is unremittable if—
Regulations may provide that where— the amount of the gain or loss shall be found in accordance with the alternative method of calculation. Regulations may also provide that as regards any day in respect of which an election has effect the accrued amount shall be ascertained in accordance with prescribed rules. The question whether a liability is eligible to be matched with an asset shall be determined in accordance with prescribed rules, and in particular regulations may include provision that— Regulations may include provision that on any day— Regulations may include provision that an election relating to an asset or assets shall be treated as made in relation to another asset or other assets (as where assets are replaced by others). Regulations may include provision— Regulations may provide that where the company is a relevant controlled foreign company an election may be made by a United Kingdom resident company which has (or may be made jointly by United Kingdom resident companies which together have) a majority interest in the company; and— Regulations may include provision— Regulations may be so framed that the accrued amount as regards a day depends on the extent to which a liability is matched. Regulations may also provide as mentioned in one or more of the following paragraphs— For the purposes of sub-paragraph (10) above each of the following is a relevant person— and a matched asset is an asset which has at any time been to any extent matched with a liability in pursuance of an election. Regulations may make provision—
This paragraph applies where regulations under more than one of paragraphs 2 to 4 above apply— Regulations may provide that, as regards any day falling within the period and identified in accordance with prescribed rules, the accrued amount shall be ascertained in accordance with rules prescribed under this paragraph (rather than provisions made under any of those paragraphs).
This paragraph applies where regulations under both paragraph 2 and paragraph 4A above apply— Regulations may provide that, as regards any day falling within the period and identified in accordance with prescribed rules, the accrued amount shall be ascertained in accordance with rules prescribed under this paragraph (rather than provisions made under either of those paragraphs).
Regulations may provide that where— the amount of the gain or loss shall be found in accordance with the alternative method of calculation. Regulations may also provide that as regards any day in respect of which an election has effect the accrued amount shall be ascertained in accordance with prescribed rules. The reference in sub-paragraph (1) above to the relevant duty is to the duty to which, under the contract, the company becomes subject as regards the second currency (within the meaning given by section 126 of this Act). Where regulations are made under this paragraph, sub-paragraphs (3) to (12) of paragraph 4 above shall apply as they apply where regulations are made under that paragraph; but in the application of those sub-paragraphs by virtue of this sub-paragraph—
Where regulations make provision under any of the relevant paragraphs, they may provide that for the purposes of section 136(11) of this Act amounts X and Y shall be found without regard to matters which are prescribed and would otherwise have had to be taken into account under the regulations ; and the relevant paragraphs are paragraphs 2, 3, 4 and 5 above..
Where regulations make provision under any of paragraphs 2 to 5A above, section 149 of this Act shall have effect as if the references to sections 125 to 127 included references to this Schedule and the provisions of the regulations.
Regulations may be so framed that the accrued amount as regards a day is nil (so that, depending on the circumstances, an initial exchange gain or initial exchange loss may be extinguished).
Regulations may make different provision about exchange gains (on the one hand) and exchange losses (on the other).
Section 165.
For the purposes of this Schedule an existing asset, liability or contract is an asset, liability or contract to which this Chapter applies by virtue of section 165(2) or (3) of this Act or by virtue of regulations under section 165(4) of this Act.
Regulations may make such provision as the Treasury think fit with regard to the application of this Chapter to an existing asset, liability or contract (such as provision for finding the basic valuation of an asset or liability). Nothing in the following provisions of this Schedule shall prejudice the generality of sub-paragraph (1) above.
Regulations may provide that— The regulations may provide that an attributed gain or loss shall be set off against exchange losses or exchange gains accruing as regards the asset or liability; and for this purpose— The regulations may provide that if an event of a prescribed description occurs as regards the asset or liability at a time falling on or after the commencement day of the company concerned and at a time when all or part of an attributed gain or loss is outstanding— The regulations may provide that where— the loss shall not be treated as accruing and relief of an amount equal to it shall be given to the company in such form and manner as may be prescribed. The regulations may provide that where provision under this paragraph has effect the outstanding attributed gain or loss shall be treated as reduced or extinguished. The regulations may make provision—
Regulations may provide that where an exchange gain or exchange loss accrues to a company as regards an existing asset or liability (or would so accrue apart from the regulations)— For the purposes of this paragraph— The regulations may be framed by reference to— and for this purpose exchange differences are gains and losses attributable to fluctuations in currency exchange rates. The regulations may include provision designed to prevent provision under them being avoided by the replacement (or partial replacement) of assets or liabilities by other assets or liabilities.
Regulations may provide that where— the loss shall be set off against exchange gains accruing to the company. For the purposes of this paragraph an exchange gain is an exchange gain of a trade or an exchange gain of part of a trade or a non-trading exchange gain. The regulations may provide that the loss may only be set off— The regulations may include rules for ascertaining whether an allowable loss of a prescribed description has or has not been allowed as a deduction under the Taxation of Chargeable Gains Act 1992.
Regulations may provide— The circumstances may be framed by reference to— and for this purpose exchange differences are gains and losses attributable to fluctuations in currency exchange rates.
Section 169.
In this Schedule “the 1992 Act” means the Taxation of Chargeable Gains Act 1992.
In a case where— for the purposes of that Act no chargeable gain or allowable loss shall accrue on the disposal. This paragraph applies to disposals on or after the company’s commencement day.
For the purposes of paragraph 2 above a company holds currency in exempt circumstances at a given time if— The purposes referred to in sub-paragraph (1)(a) above are— In this paragraph—
This paragraph applies where there is for the purposes of the 1992 Act a disposal or acquisition of an asset which is— In a case where— the section concerned shall not apply as regards the disposal and the corresponding acquisition or (as the case may be) shall not apply as regards the acquisition and the corresponding disposal. The condition is that stated in paragraph (a) or (b) below (as the case may be)— For the purposes of this paragraph qualifying purposes are purposes which constitute one or both of the following— and “long-term insurance business” means business which consists of the effecting or carrying out of contracts which fall within Part II of Schedule 1 to the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001. This paragraph applies where the disposal or acquisition (as the case may be) is made on or after the commencement day of the company mentioned in sub-paragraph (3)(a) or (b) above (as the case may be).
Section 170.
In section 87A of the Taxes Management Act 1970 (interest on overdue tax for accounting periods ending after appointed day) the following subsection shall be inserted after subsection (4)—
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and the reference in paragraph (c) above to a relievable amount shall be construed in accordance with section 131 of the Finance Act 1993.
In section 826 of the Taxes Act 1988 (interest on tax overpaid) the following subsection shall be inserted after subsection (7B)—
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Section 173.
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directly from their membership of the syndicate, or
from assets forming part of premiums trust funds,
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Section 175.
In this Part of this Schedule— For the purposes of the definitions of “syndicate profit” and “syndicate loss” in sub-paragraph (1) above—
The arrangements must provide— and in this sub-paragraph “authorised” means authorised under the rules of Lloyd’s. The arrangements must be such as to secure that—
The arrangements must be such as to secure that, if the member has made a syndicate profit for an underwriting year, he has the right to make, into his special reserve fund, payments the amount of which is not in the aggregate greater than whichever of the following is the less, namely— Any payments which a member is entitled to make by virtue of sub-paragraph (1) above must be made before the end of such period as may be prescribed. Where the member did not accept premiums in the closing year, the reference in sub-paragraph (1)(b) above to the member’s overall premium limit for that year shall be construed as a reference to that limit for the latest underwriting year in which he did so.
The arrangements must be such as to secure that, if a cash call is made on the member in respect of an underwriting year, there shall be made into a premium trust fund of his, out of his special reserve fund, payments the amount of which is equal in the aggregate to the amount of the call, or the amount of his special reserve fund, whichever is the less. References in sub–paragraph (1) above to a cash call include references to a cash call made in respect of an underwriting year determined by paragraph 1(2)(c) above (“the relevant cash call”) if and to the extent that the aggregate amount of the relevant cash call and any previous cash calls made on the member in respect of the syndicate concerned exceeds the net amount of losses arising to the member from that syndicate which have been declared before the date of the relevant cash call after deducting the amount of profits arising to him from that syndicate which have been so declared. Where the aggregate amount of any payments made under sub-paragraph (1) above in respect of any year is found to exceed the amount of the member’s syndicate loss for the year, there shall be made into his special reserve fund, out of a premium trust fund or ancillary trust fund of his, payments the amount of which is equal in the aggregate to the amount of the excess. Where a stop-loss payment is made to the member in respect of his syndicate loss for any year, so much of the stop-loss payment as does not exceed the requisite amount shall be paid into his special reserve fund. In sub-paragraph (3) above “the requisite amount” means so much of the amount (if any) given by sub-paragraph (5) below as does not exceed the aggregate amount mentioned in paragraph (b) of that sub-paragraph. The amount given by this sub-paragraph is the amount by which— exceeds in the aggregate the amount of the member’s syndicate loss. Where the whole or any part of a stop-loss payment made to a member is repaid, there shall be made to the member or his personal representatives or assigns, out of his special reserve fund, payments the amount of which is equal in the aggregate to the amount (if any) to which sub-paragraph (7) below applies or the amount of his special reserve fund, whichever is the less. This sub-paragraph applies to any amount which— Any payments required by sub-paragraph (1), (2), (3) or (6) above shall be made before the end of such period as may be prescribed.
The arrangements must be such as to secure that, if the member has sustained a syndicate loss for an underwriting year, there shall be made into a premium trust fund of his, out of his special reserve fund, payments the amount of which is equal in the aggregate to the net amount of the loss or the amount of his special reserve fund, whichever is the less. Sub-paragraphs (3) and (4) below apply where a stop-loss payment is made to the member in respect of his syndicate loss for any year. If any payments are subsequently made for the year under sub-paragraph (1) above, the aggregate amount of those payments shall be determined as if the net amount of the syndicate loss were reduced by the amount of the stop-loss payment. If any payments have previously been made for the year under sub-paragraph (1) above, so much of the stop-loss payment as does not exceed the requisite amount shall be paid into his special reserve fund. In sub-paragraph (4) above “the requisite amount” means so much of the amount (if any) given by sub-paragraph (6) below as does not exceed the amount mentioned in paragraph (b) of that sub-paragraph. The amount given by this sub-paragraph is the amount by which— exceeds in the aggregate the net amount of the member’s syndicate loss. Where the whole or any part of a stop-loss payment made to a member is repaid, there shall be made to the member or his personal representatives or assigns, out of his special reserve fund, payments the amount of which is equal in the aggregate to the aggregate of the amounts (if any) to which sub-paragraphs (8) and (9) below apply or the amount of his special reserve fund, whichever is the less. This sub-paragraph applies to any amount which— This sub-paragraph applies to any amount which— Any payments required by sub-paragraph (1), (4) or (7) above shall be made before the end of such period as may be prescribed. In this paragraph “net amount”, in relation to a member’s syndicate loss for any year, means the amount of the loss as reduced by the amount of any payments made under paragraph 4(1) above for the year.
The arrangements must be such as to secure that the fund manager of a member’s special reserve fund— and the report shall also state such other matters as may be prescribed. If the value (determined under sub-paragraph (1) above) of the fund as at the end of any underwriting year exceeds 50 per cent. of— there shall be made to the member or his personal representatives or assigns, out of his special reserve fund, payments the amount of which is equal in the aggregate to the excess. The payments required by sub-paragraph (2) above shall be made before the end of such period as may be prescribed.
The arrangements must provide that, on the member ceasing to carry on his underwriting business, whether by reason of death or otherwise, the amount of his special reserve fund, so far as not required for giving effect to the requirements of paragraph 4 or 5 above, shall be paid over to the member or his personal representatives or assigns. For the purposes of sub-paragraph (1) above, a payment of an amount shall be in money or in assets forming part of the fund or both, as the member or his personal representatives or assigns may direct.
Subject to sub-paragraph (2) and paragraph 11(2)-(4)below, a member shall be treated for the purposes of the Income Tax Acts and the Gains Tax Acts as absolutely entitled as against the trustees to the assets forming part of his special reserve fund. Where an asset is disposed of by a member to the trustees of his special reserve fund, nothing in sub-paragraph (1) above shall affect the operation of the Gains Tax Acts in relation to that disposal.
Profits or losses arising from assets forming part of a special reserve fund shall be excluded for the purposes of income tax under the Income Tax Acts, and for the purposes of capital gains tax under the Gains Tax Acts. Where for any underwriting year income tax has been deducted from any profits arising from assets forming part of a special reserve fund, the fund manager may, at any time after the end of that year, claim repayment of that tax. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
In computing for the purposes of income tax the profits of a member’s underwriting business for any year of assessment, the aggregate amount of any payments which, in respect of the relevant underwriting year, are made into his special reserve fund under paragraph 3(1) above shall be deducted as an expense. In computing for the purposes of income tax the profits of a member’s underwriting business for any year of assessment— In computing for the purposes of income tax the profits of a member’s underwriting business for any year of assessment, the aggregate amount of any payments which, as a result of the repayment of stop-loss payments in the relevant underwriting year, are made out of his special reserve fund under paragraph 4(6) or 5(7) above shall be treated as a trading receipt. In computing for the purposes of income tax the profits of a member’s underwriting business for any year of assessment, the aggregate amount of any payments which, in respect of the relevant underwriting year’s closing year, are made out of his special reserve fund under paragraph 6(2) above (including where they are also made under paragraph 7(1) above)shall be treated as a trading receipt. In this paragraph “the relevant underwriting year”, in relation to a year of assessment, means the underwriting year next but two before its corresponding underwriting year.
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In this Part of this Schedule— For the purposes of sub-paragraph (1) above, the closing date for an old-style fund shall be the earliest date on which each of the following has occurred as respects the year 1991-92 and earlier years of assessments, namely—
A member may, at any time before the end of the relevant period, direct that so much of the capital of any old-style fund of his as represents sums paid into it under section 452(5) of the Taxes Act 1988 shall be transferred, at the end of that period, into his new-style fund; . . . Where an amount of capital is transferred into a member’s new-style fund under sub-paragraph (1) above, there shall be paid into that fund by the Board an amount equal to the amount of tax which, if the amount transferred were a net amount corresponding to a gross amount from which income tax had been duly deducted at the basic rate for the year 1992-93, would have been so deducted. If a member does not give a direction under sub-paragraph (1) above in relation to any old-style fund of his, so much of the capital of that fund as represents sums paid into it under section 452(5) of the Taxes Act 1988 shall be paid over, at the end of the relevant period, to the member or his personal representatives or assigns. In either event, the remaining capital of any old-style fund of a member shall be paid over, at the end of the relevant period, to the member or his personal representatives or assigns. For the purposes of sub-paragraphs (1) and (3) above, any payments made out of an old-style fund under section 453(1) of the Taxes Act 1988 shall be treated as having been met, so far as possible, out of payments made into the fund under section 452(5) of that Act. A transfer or payment under this paragraph of an amount of capital shall be in money or in assets forming part of the fund or both, as the member may direct.
Where an asset is transferred into a member’s new-style fund under paragraph 13(1) above, the transfer shall be treated, for the purposes of the Gains Tax Acts, to be a disposal of the asset by the member for a consideration equal to its market value. Sub-paragraph (3) below applies where an amount is paid over to the member or his personal representatives or assigns under paragraph 13(3) above. In computing for the purposes of income tax the profits of the member’s underwriting business for the year 1992-93, it shall be assumed—
Section 187.
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the copies must be photographic or otherwise by way of facsimile; and
if so required by the Board in the case of any documents specified in the requirement, the originals must be made available for inspection by a named officer of the Board (failure to comply with this requirement counting as failure to comply with the notice).
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the information within paragraph 9 or paragraph 10 is contained in some other document; and
either—
that other document, or a copy of it, has been delivered to the Board, or
that other document has been inspected by an officer of the Board.
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deliver to the Board a copy (which is photographic or otherwise by way of facsimile) of any parts of the document which contain the information within paragraph 9 or paragraph 10; and
if so required by the Board, make available for inspection by a named officer of the Board such parts of the document as contain that information;
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Section 210.
The Government Trading Funds Act 1973 shall be amended as follows.
The following section shall be inserted after section 2— In section 2(3) (originating debt where fund established) in paragraph (b) after “capital” there shall be inserted “ or any amount treated by virtue of the order as reserves or (where the order provides for both public dividend capital and reserves) the aggregate of those amounts ”. In section 2(4) (addition to originating debt where additional assets and liabilities appropriated to fund) in paragraph (b) after “capital” there shall be inserted “ for any amount treated by virtue of the order as reserves or (where the order provides for both public dividend capital and reserves) the aggregate of those amounts ”.
In section 2A (public dividend capital) the following subsection shall be inserted after subsection (2) (limited power of Minister to issue public dividend capital to fund)—
The following section shall be inserted after section 2B— In section 2B (borrowing by funds) subsections (6) to (9) (which are superseded by the new section 2C) shall be omitted.
Section 213.
Chapter Short title Extent of repeal 1979 c. 4. The Alcoholic Liquor Duties Act 1979. In section 42, in subsection (2) paragraph (a) and in paragraph (b) the words “or removal to the Isle of Man”, and in subsections (3) and (4) the word “remove,” in each place where it occurs. Section 43. Section 45(1)(b). Section 51. 1979 c. 58. The Isle of Man Act 1979. In Schedule 1, paragraph 30. 1991 c. 31. The Finance Act 1991. In Schedule 2, paragraph 10. These repeals have effect in accordance with section 4 of this Act Chapter Short title Extent of repeal 1979 c. 4. The Alcoholic Liquor Duties Act 1979. In section 55, paragraph (e) of subsection (5) and the word “and” immediately preceding that paragraph, and subsection (5A). These repeals have effect in accordance with section 5 of this Act. Chapter Short title Extent of repeal 1979 c. 4. The Alcoholic Liquor Duties Act 1979. Section 58(2). This repeal has effect in accordance with section 6 of this Act. Chapter Short title Extent of repeal 1979 c. 5. The Hydrocarbon Oil Duties Act 1979. Section 4. Section 7. Section 16. Section 19(6). In section 20AA(1)(a), the words “petrol substitute, spirits used for making power methylated spirits”. Section 21(1)(b). In section 27(1), the definitions of “petrol substitute” and “power methylated spirits”. Part II of Schedule 3. 1979 c. 8. The Excise Duties (Surcharges or Rebates) Act 1979. In section 1(1)(a), the words “(other than power methylated spirits)”. 1986 c. 41. The Finance Act 1986. In paragraph 4 of Schedule 5, “13”. The power in section 11(5) of this Act applies to these repeals as it applies to that section. Chapter Short title Extent of repeal 1979 c. 5. The Hydrocarbon Oil Duties Act 1979. Section 2(5). In section 15(1), the words “shown to the satisfaction of the Commissioners to have been”. The power in section 12(8) of this Act applies to these repeals as it applies to that section. Chapter Short title Extent of repeal 1985 c. 54. The Finance Act 1985. In Schedule 2, paragraph 6. 1988 c. 39. The Finance Act 1988. Section 4(2). 1989 c. 26. The Finance Act 1989. Section 6(6). 1990 c. 29. The Finance Act 1990. Section 5(7). 1991 c. 31. The Finance Act 1991. Section 4(4). 1992 c. 20. The Finance Act 1992. Section 4(3) and (4). These repeals have effect in relation to licences taken out after 16th March 1993. Chapter Short title Extent of repeal 1979 c. 2. The Customs and Excise Management Act 1979. In section 1(1), in the definition of “the revenue trade provisions of the customs and excise Acts”, the word “and” at the end of paragraph (b) and, in the definition of “revenue trader”, the word “or” at the end of paragraph (a)(i). 1981 c. 63. The Betting and Gaming Duties Act 1981. Section 6(4). 1986 c. 41. The Finance Act 1986. In Schedule 4, paragraph 2(2). These repeals come into force in accordance with section 41 of this Act.
Chapter Short title Extent of repeal 1983 c. 55. The Value Added Tax Act 1983. In Schedule 5, Group 7. This repeal comes into force in accordance with section 42 of this Act.
Chapter Short title Extent of repeal 1986 c. 41. The Finance Act 1986. In Schedule 6— (a) in paragraph 2(1) and (2), the words “Subject to paragraph 3 below,”, in each place where they occur; and (b) paragraph 3 and the Table B set out after that paragraph. These repeals have effect in relation to any case where the prescribed accounting period begins after 5th April 1993.
Chapter Short title Extent of repeal 1983 c. 55. The Value Added Tax Act 1983. In section 5(9), in the words after paragraph (b), the words from “a supply of goods” to “below or there is”. Section 32B. In section 48(1), in the definition of “taxable person”, the words “(subject to section 32B(3) above)”. 1992 c. 48. The Finance (No. 2) Act 1992. In paragraph 6(2) of Schedule 3, paragraph (b) and the word “and” immediately preceding it. These repeals come into force in accordance with section 44(4) of this Act.
Chapter Short title Extent of repeal 1985 c. 54. The Finance Act 1985. Section 13(4). Section 19(2)(b). The repeal of section 13(4) of the Finance Act 1985 has effect in accordance with paragraph 3(3) of Schedule 2 to this Act and the repeal of section 19(2)(b) of that Act has effect in accordance with paragraph 5(3) of that Schedule.
Chapter Short title Extent of repeal 1983 c. 55. The Value Added Tax Act 1983. In Schedule 4, in paragraph 3A(1) the words “or with car tax” and the word “tax” in the second place where it occurs. In Schedule 4A, in paragraph 2(1) the words “or with car tax” and the word “tax” in the second place where it occurs. In Schedule 7, in paragraph 2(3B) the words “or of a chargeable vehicle within the meaning of the Car Tax Act 1983” and the words “or of such a vehicle”.
Chapter Short title Extent of repeal 1988 c. 1. The Income and Corporation Taxes Act 1988. Section 354(5) and (6). Section 356D(9). Section 357(4). Section 371. In paragraph 10(1) and (2) of Schedule 7, the words “354(5) and (6)”, in each place. These repeals come into force in accordance with section 57 of this Act.
Chapter Short title Extent of repeal 1990 c. 29. The Finance Act 1990. Section 24. 1992 c. 48. The Finance (No. 2) Act 1992. Section 26.
The repeal of section 24 of the Finance Act 1990 has effect for the year 1993-94 and subsequent years of assessment.
Chapter Short title Extent of repeal 1988 c. 1. The Income and Corporation Taxes Act 1988. Section 157(4) and (5). These repeals have effect for the year 1994-95 and subsequent years of assessment.
Chapter Short title Extent of repeal 1988 c. 1. The Income and Corporation Taxes Act 1988. In section 158(5), the words “or 3”. This repeal has effect for the year 1993-94.
Chapter Short title Extent of repeal 1988 c. 1. The Income and Corporation Taxes Act 1988. In section 159A(8)(a), the word “but” at the end of sub-paragraph (i). This repeal has effect for the year 1993-94 and subsequent years of assessment.
Chapter Short title Extent of repeal 1988 c. 1. The Income and Corporation Taxes Act 1988. In section 233(1)(c), the words “as income which is not chargeable at the lower rate and”. 1992 c. 12. The Taxation of Chargeable Gains Act 1992. In section 5(2)(a), the words “(liability to income tax at the additional rate)”. 1992 c. 48. The Finance (No. 2) Act 1992. In section 19, in subsection (3), the words “233(2)” and, in subsection (4), the words “233(1)(c)”. These repeals have effect for the year 1993-94 and subsequent years of assessment.
Chapter Short title Extent of repeal 1992 c. 12. The Taxation of Chargeable Gains Act 1992. In paragraph 1 of Schedule 6, in sub-paragraph (2), the definitions of “family company”, “family” and “relative”, and sub-paragraphs (3) and (4). These repeals come into force in accordance with section 87(2) of this Act.
Chapter Short title Extent of repeal 1988 c. 1. The Income and Corporation Taxes Act 1988. Section 432A(10). 1992 c. 12. The Taxation of Chargeable Gains Act 1992. In section 212— (a) in subsection (2), the words from “and in relation to” onwards; (b) subsections (3), (4), (6) and (8). Section 213(9). Section 214(3) to (5). The repeal of section 212(8) of the Taxation of Chargeable Gains Act 1992 has effect, in accordance with section 91(1) of this Act, in relation to the accounting periods mentioned in section 212(8), and the other repeals have effect in relation to accounting periods beginning on or after 1st January 1993.
Chapter Short title Extent of repeal 1970 c. 9. The Taxes Management Act 1970. In section 31(3), the word “445”. 1988 c. 1. The Income and Corporation Taxes Act 1988. In section 11(3), the words “Subject to section 447,”. Section 445. Section 446(1). Section 447(1), (2) and (4). Section 448. Section 449. Section 724(5) to (8). In section 811(2), paragraph (c) and the word “and” immediately preceding it. In Schedule 19AB, paragraph 1(9). 1991 c. 31. The Finance Act 1991. In Schedule 7, paragraph 7(1)(a), (2), (4) and (5). These repeals have effect in accordance with section 103 of this Act.
Chapter Short title Extent of repeal 1988 c. 1. The Income and Corporation Taxes Act 1988. Section 1(5). Section 257C(2). 1990 c. 29. The Finance Act 1990. Section 17(2). These repeals have effect in accordance with section 107 of this Act.
Chapter Short title Extent of repeal 1988 c. 1. The Income and Corporation Taxes Act 1988. In section 343(3), the word “claim”, in the second place where it occurs. In section 395, in the words after paragraph (c) of subsection (1) and in subsection (4), the words “to claim relief”. In section 400(2)(a), the words “or, if a claim had been made under that subsection, would be”. 1991 c. 31. The Finance Act 1991. In Schedule 15, paragraphs 2 and 9. The repeals in the Income and Corporation Taxes Act 1988 and the repeal of paragraph 9 of Schedule 15 to the Finance Act 1991 have effect in relation to accounting periods ending after the day appointed for the purposes of section 10 of the Income and Corporation Taxes Act 1988.
Chapter Short title Extent of repeal 1988 c. 1. The Income and Corporation Taxes Act 1988. Sections 450 to 457. Section 710(14). In section 711(8), the words “or section 725(9)” and the words “or straddling”, in both places where they occur. Section 720(3). In section 721, subsections (5) and (6). Section 725. In Schedule 4, paragraph 18. Schedule 19A. 1989 c. 26. The Finance Act 1989. In section 43, subsections (6) and (7). In section 92, subsections (4) to (7). In Schedule 11, paragraph 10. 1990 c. 29. The Finance Act 1990. In Schedule 10, paragraph 18. 1992 c. 12. The Taxation of Chargeable Gains Act 1992. Sections 206 to 209. 1993 c. 34. The Finance Act 1993. In section 183, subsections (4) to (8).
The repeal of section 450(6) of the Income and Corporation Taxes Act 1988 has effect in relation to acquisitions or disposals made, or treated as made, after 31st December 1993.
The following repeals, namely— the repeals in sections 710, 711, 720 and 721 of and Schedule 4 to the Income and Corporation Taxes Act 1988 and the repeal of section 725 of that Act; the repeal in Schedule 11 to the Finance Act 1989; the repeal in Schedule 10 to the Finance Act 1990; the repeals of sections 207 and 208 of the Taxation of Chargeable Gains Act 1992; and the repeals of subsections (4) to (6) of section 183 of this Act, have effect for the year 1994 and subsequent underwriting years.
The repeals in section 43 of the Finance Act 1989 have effect in relation to periods of account ending on or after 30th June 1993.
The following repeals, namely— the repeals of subsections (2) to (5) of section 206 and subsections (1), (2) and (6) of section 209 of the Taxation of Chargeable Gains Act 1992; and the repeals of subsections (7) and (8) of section 183 of this Act, have effect for the year of assessment 1994-95 and subsequent years of assessment.
The other repeals have effect for the year 1992-93 and subsequent years of assessment.
Chapter Short title Extent of repeal 1975 c. 22. The Oil Taxation Act 1975. In Schedule 2, in the Table in paragraph 1, in the modification relating to section 98 of the Taxes Management Act 1970, the words “or to paragraph 7 of this Schedule”; and paragraph 7.
Chapter Short title Extent of repeal 1984 c. 51. The Inheritance Tax Act 1984. In section 267(4), the words “but without regard to any dwelling-house available in the United Kingdom for his use”.
This repeal has effect in accordance with section 208 of this Act.
Chapter Short title Extent of repeal 1968 c. 2. The Provisional Collection of Taxes Act 1968. In section 1, in subsection (1) the words “car tax”.... In section 5(1), paragraph (c) and the word “or” immediately preceding it. 1988 c. 1. The Income and Corporation Taxes Act 1988. In section 8, subsections (4) to (6).
The repeals in the Provisional Collection of Taxes Act 1968 have effect in accordance with section 205 of this Act.
Chapter Short title Extent of repeal 1973 c. 63. The Government Trading Funds Act 1973. In section 2B, subsections (6) to (9).
“ordinary share capital” has the meaning given by section 989 of ITA 2007;
“regulations” means regulations made by the Commissioners.
This Chapter applies in relation to lotteries promoted on behalf of the Crown in pursuance of any enactment as it applies in relation to lotteries not so promoted.
The imposition by this Chapter of lottery duty does not make lawful anything that is unlawful apart from this Chapter.
This Chapter shall come into force on such day as the Commissioners may by order appoint, and different days may be appointed for different provisions or for different purposes.
The supplies of the descriptions specified in Group 7 of Schedule 5 to the Value Added Tax Act 1983 (supplies of fuel and power for domestic or charity use) shall cease to be zero-rated for the purposes of charging value added tax on any supply, acquisition or importation made or taking place on or after 1st April 1994.
Section 9 of the Value Added Tax Act 1983 (rate of tax) shall have effect— as if a rate of 8 per cent. were substituted for the rate specified in subsection (1) of that section.
in relation to so much of any supply made on or after 1st April 1994 and before 1st April 1995 as (but for subsection (1) above) would be zero-rated by virtue of Group 7 of Schedule 5 to that Act; and
in relation to any equivalent acquisition or importation taking place on or after 1st April 1994 and before 1st April 1995,
The reference in subsection (2) above to an equivalent acquisition or importation, in relation to any supply which would be zero-rated but for subsection (1) above, is a reference, as the case may be, to—
any acquisition from another member State of goods the supply of which would be such a supply; or
any importation from a place outside the member States of any such goods.
This section shall be construed as one with the Value Added Tax Act 1983.
Paragraph 3 of Schedule 6 to the Finance Act 1986 and the Table B set out after that paragraph (consideration for fuel for private use where business use not less than specified amount) shall not have effect in relation to any case where the prescribed accounting period begins after 5th April 1993.
Accordingly, that Schedule shall have effect in relation to any such case with the following amendments, namely—
in paragraph 5(1)(a), for the words from “cubic capacity” to “in question” there shall be substituted “vehicle specified in Table A above, that Table”;
in paragraph 5(1)(b), for “cubic capacity specified in those Tables” and “the Table in question” there shall be substituted, respectively, “vehicle specified in that Table” and “that Table”;
in paragraph 6(1), for the words from “Tables” onwards there shall be substituted “Table A above is the capacity of its engine as calculated for the purposes of the Vehicles (Excise) Act 1971”; and
in paragraph 6(2), for “Tables A and B” there shall be substituted “Table A”.
Paragraph 4 of that Schedule (power of Treasury to substitute Tables) shall have effect for the purposes of the making of any order after 5th April 1993 with the substitution of “the Table A for the time being” for “either of the Tables”.
After section 8C of the Value Added Tax Act 1983 there shall be inserted the following section—
Section 32B of that Act (overseas suppliers accounting through their customers) shall cease to have effect.
As a consequence of the preceding provisions of this section—
in section 6(1) of that Act (place of supply), for “section 35” there shall be substituted “sections 8D and 35”; and
in section 8C(1) of that Act (place of acquisition), for “sections 32B(5) and 35” there shall be substituted “section 35”.
This section shall have effect in relation to supplies of goods made on or after 1st August 1993 other than a supply of goods by an intermediate supplier to whom the goods were supplied before that date.
After section 37B of the Value Added Tax Act 1983 there shall be inserted the following section—
In section 5(9) of that Act (power to modify time of supply)—
in the words before paragraph (a), after “4 above” there shall be inserted “or 37C(4) below”; and
in the words after paragraph (b), before “a supply of services” there shall be inserted “a supply to which section 37C below applies or there is”.
Subsection (1) above, so far as it makes provision in relation to supplies of gold, shall have effect in relation to supplies made on or after 1st April 1993, but section 5 of that Act shall be disregarded in determining the time of any supply for the purposes of this subsection.
In section 40 of the Value Added Tax Act 1983 (appeals), after subsection (3) there shall be inserted the following subsection—
This section shall apply in relation to any appeal relating to the input tax that may be credited to any person at the end of a prescribed accounting period beginning on or after the day on which this Act is passed.
Paragraph 5 of Schedule 2 to the Value Added Tax Act 1983 (matters to be treated as supplies) shall be amended as follows.
In sub-paragraph (2) (gifts which are not to be treated as supplies), for paragraph (b) there shall be substituted the following paragraph—
Where— sub-paragraph (1) above shall apply to all except one of those samples or, as the case may be, to all except the first to be given.
Neither sub-paragraph (1) nor sub-paragraph (3) above shall require anything which a person carrying on a business does otherwise than for a consideration in relation to any goods to be treated as a supply except in a case where that person is entitled under sections 14 and 15 of this Act to credit for the whole or any part of the tax on the supply, acquisition or importation of those goods or of anything comprised in them.
In section 11 of the Finance Act 1990 (bad debts) in subsection (1)(c) (period of one year beginning with date of supply must elapse) for “one year” there shall be substituted “six months”.
This section shall be deemed to have come into force on 1st April 1993 and shall apply in relation to supplies made on or after 1st April 1992.
The Value Added Tax Act 1983 shall be amended as follows.
In Schedule 4 (valuation: special cases) in paragraph 3A(1)— shall be omitted.
the words “or with car tax”, and
the word “tax” in the second place where it occurs,
In Schedule 4A (valuation of acquisitions from other member states: special cases) in paragraph 2(1)— shall be omitted.
the words “or with car tax”, and
the word “tax” in the second place where it occurs,
In Schedule 7 (administration, collection and enforcement) in paragraph 2(3B)—
the words “or of a chargeable vehicle within the meaning of the Car Tax Act 1983” shall be omitted,
the words “or of such a vehicle” shall be omitted, and
for the words from “any duty” to “may allow” there shall be substituted the words “any duty or agricultural levy in the value of the supply or acquisition determined, by reference to the duty point or by reference to such later time as the Commissioners may allow.”
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Income tax shall be charged for the year 1993-94, and for that year—
the lower rate shall be 20 per cent.,
the basic rate shall be 25 per cent., and
the higher rate shall be 40 per cent.
For the year 1993-94 section 1(2) of the Taxes Act 1988 shall apply as if— and accordingly section 1(4) of that Act (indexation) shall not apply for the year 1993-94.
the amount specified in paragraph (aa) were £2,500 (the lower rate limit), and
the amount specified in paragraph (b) were £23,700 (the basic rate limit);
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Corporation tax shall be charged for the financial year 1993 at the rate of 33 per cent.
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the small companies' rate shall be 25 per cent., and
the fraction mentioned in section 13(2) of the Taxes Act 1988 (marginal relief for small companies) shall be one fiftieth.
For the year 1993-94 the qualifying maximum defined in section 367(5) of the Taxes Act 1988 (limit on relief for interest on certain loans) shall be £30,000.
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In section 365 of that Act (relief on interest on loans to buy a life annuity), after subsection (1) there shall be inserted the following subsections—
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in section 354(1), for “to (6)” there shall be substituted “to (4)”;
sections 354(5) and (6), 356D(9), 357(4) and 371 (second loans) shall cease to have effect;
in section 370(1), for “371” there shall be substituted “372”;
and section 355(1A) shall have effect as if after the word “used” in paragraph (a) there were inserted the words “wholly or to a substantial extent”.
in section 370(7), after paragraph (a) there shall be inserted the following paragraph—.
This section shall have effect in relation to payments of interest made on or after 16th March 1993 (whenever falling due).
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shall be exercisable in any case in relation to that period irrespective of when that period began in that case; and
in so far as it is exercisable in relation to the period specified in section 355(1A) of that Act where an equivalent period has been extended in any case under section 354(6) or 371(2) or (3) of that Act, shall be deemed to have been exercised so that (subject to any further extensions) the period in question ends when that equivalent period would have ended.
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section 355(1A) of the Taxes Act 1988 has effect in the case of any loan so that the condition specified in section 355(1)(a) of that Act is treated in relation to any person as fulfilled with respect to any land, caravan or house-boat, and
apart from the provisions of this section, section 27(3) or (4) of the Finance Act 1991 would have had effect in relation to any interest on that loan, or would have so had effect if any extension of the period which applies for the purposes of section 355(1A) of the Taxes Act 1988 were treated as an equivalent extension of the period which applied for the purposes of section 354(5) or 371(1) of that Act,
After subsection (6) of section 369 of the Taxes Act 1988 (recovery of amount treated as paid by recipient of interest paid subject to a deduction under that section) there shall be inserted the following subsection—
This section shall not apply in relation to any payment if the payment, or the claim on which it is made, was made before the day on which this Act is passed.
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This section applies where—
a qualifying company becomes subject to a qualifying debt, and
the interest payable exceeds a commercial return on the capital repayable, expressing that capital in the settlement currency of the debt.
In computing the corporation tax chargeable for an accounting period of the company, so much of the excess interest as is paid in the accounting period shall not be allowed as a deduction against the total profits for the period (if it would be allowed apart from this section).
In this section—
“profits” includes gains;
“the Management Act” means the Taxes Management Act 1970;
This section applies where the company becomes subject to the debt (whether as the original debtor or otherwise) on or after the day which is its commencement day for the purposes of section 165 below.
A debt is a qualifying debt for the purposes of sections 63 to 66 below at any time if, at that time—
the person entitled to the debt is a company which is resident in the United Kingdom (“the resident company”);
the person liable for the debt is either a qualifying company or a qualifying third party; and
the debt is not an exempted debt for those purposes.
A company is a qualifying company for the purposes of this section and section 62 below at any time if, at that time, the company—
is an associated company of the resident company, and
is resident outside the United Kingdom.
For the purposes of subsection (2)(b) above, any company which, though resident in the United Kingdom, is regarded for the purposes of any double taxation arrangements as resident in a territory outside the United Kingdom shall be treated as if it were resident outside the United Kingdom.
A third party, that is to say, a person who is not an associated company of the resident company, is a qualifying third party for the purposes of this section and section 62 below at any time if, at that time, each of the two conditions mentioned below is fulfilled.
The first condition is that, in pursuance of any arrangements made with the third party, that party has at any earlier time been put in funds (directly or indirectly)—
by the resident company or by a company which was at that earlier time an associated company of the resident company, or
by a person from whom the resident company has (directly or indirectly) acquired the debt or by a company which was at that earlier time an associated company of that person.
The second condition is that, in pursuance of those arrangements, a company which is a qualifying company has at any earlier time been put in funds (directly or indirectly) by the third party or by a company which was at that earlier time an associated company of that party.
In this section—
“double taxation arrangements” means double taxation arrangements having effect by virtue of section 788 of that Act.
A debt is an exempted debt for the purposes of sections 63 to 66 below at any time if each of the first, second and third conditions mentioned below—
is fulfilled at that time;
has been fulfilled throughout so much of the period of the debt as falls before that time; and
is likely to be fulfilled throughout so much of that period as falls after that time.
The first condition is that the terms of the debt provide that any interest carried by it shall be at a rate which falls into one, and one only, of the following categories—
a fixed rate which is the same throughout the period of the debt;
a rate which bears to a standard published rate the same fixed relationship throughout that period; and
a rate which bears to a published index of prices the same fixed relationship throughout that period.
The second condition is that those terms provide for any such interest to be payable as it accrues at intervals of 12 months or less.
The third condition is that those terms are such that—
the amount payable on the debt’s redemption cannot exceed the amount of the consideration given for it, or
the debt must be redeemed within 12 months of its creation.
For the purposes of subsection (4) above the amount payable on a debt’s redemption does not include any amount payable by way of interest.
A debt is an exempted debt for the purposes of sections 63 to 66 below at any time if the inspector is satisfied that the fourth condition mentioned below is fulfilled and either—
he is also so satisfied with respect to the fifth condition so mentioned, or
the sixth condition so mentioned is fulfilled.
The fourth condition is that the possibility of returns on the debt being chargeable to tax as they arise rather than as they accrue was not the main reason, or one of the main reasons, why the resident company created the debt on the qualifying terms, acquired the debt on those terms or (as the case may be) agreed to the subsequent inclusion of those terms.
The fifth condition is that, even if the person liable for the debt were none of the following, namely— the resident company would have still created the debt on the qualifying terms, acquired the debt on those terms or (as the case may be) agreed to the subsequent inclusion of those terms.
a qualifying company;
a qualifying third party; and
a person who would be such a company or party if paragraph (b) of section 61(2) above were omitted,
Where it is not the resident company’s business to make loans generally, that fact shall be disregarded in applying subsection (8) above.
The sixth condition is that the terms of the debt—
are such that the debt must be redeemed before the end of the relevant period, or
provide for any interest accruing during that period to be payable no later than immediately after the end of that period and for any interest subsequently accruing to be payable as it accrues at intervals of 12 months or less.
In subsection (10) above “the relevant period” means the period of 24 months beginning with the date when the resident company created the debt on the qualifying terms, acquired the debt on those terms or (as the case may be) agreed to the subsequent inclusion of those terms.
A debt is an exempted debt for the purposes of sections 63 to 66 below at any time if the inspector is satisfied that, at that time, the seventh condition mentioned below was fulfilled.
The seventh condition is that, by reason of its inability to pay its debts, the principal debtor— under or by virtue of the laws of the territory in which it is or was incorporated.
has been, is in the course of being or is likely to be wound up, or
has been or is likely to be dissolved,
Any reference in subsection (13) above to the principal debtor having been or being likely to be dissolved includes a reference to its otherwise having ceased or being likely to cease to exist as a company.
Where there is an appeal arising under subsection (6) or (12) above, that subsection shall be construed as if the reference to the inspector being satisfied were a reference to the Commissioners concerned being satisfied.
In this section—
“the principal debtor” means the qualifying company liable for the debt or, as the case may be, the qualifying company mentioned in section 61(6) above;
Subsection (2) below applies where the debt on an accrued income security— and in that subsection “the relevant day” means the day mentioned in whichever of paragraphs (a) to (d) above is applicable.
is a qualifying debt at the end of the day immediately preceding the commencement date;
becomes such a debt on any day after that date;
ceases to be such a debt on any such day; or
is such a debt at the end of the last day of any accounting period of the resident company ending after that date;
For the purposes of sections 710 to 728 of the Taxes Act 1988 (accrued income scheme) the security— and, in relation to such a transfer, the settlement day is the day of the transfer (notwithstanding section 712).
except in a case falling within paragraph (b) of subsection (1) above, shall be treated as transferred by the resident company with accrued interest on the relevant day;
in a case falling within that paragraph where the resident company was the holder of the security on the day immediately preceding the relevant day, shall be treated as transferred by that company with accrued interest on that preceding day; and
in a case falling within paragraph (c) of that subsection where the security is not a variable interest rate security, shall cease to be treated as such a security as from the end of the relevant day;
Subsection (4) below applies where the debt on an accrued income security— and in that subsection “the relevant day” means the day mentioned in whichever of paragraphs (a) to (d) above is applicable.
is a qualifying debt at the beginning of the commencement date;
becomes such a debt on any day after that date;
ceases to be such a debt on any such day; or
is such a debt at the beginning of the first day of any accounting period of the resident company beginning after that date;
For the purposes of sections 710 to 728 the security— and, in relation to such a transfer, the settlement day is the day of the transfer (notwithstanding section 712).
except in a case falling within paragraph (c) of subsection (3) above, shall be treated as transferred to the resident company with accrued interest on the relevant day;
in a case falling within that paragraph where the resident company is the holder of the security on the day immediately following the relevant day, shall be treated as transferred to that company with accrued interest on that following day; and
in a case falling within paragraph (a) or (b) of that subsection where the security is not a variable interest rate security, shall be treated as such a security as from the beginning of the relevant day;
Any income which, apart from this subsection, would be treated as arising on any day by virtue of subsection (1)(a) or (b) above shall be treated as not arising until whichever of the following is the earliest, namely—
the earliest day on which, under the terms on which the security is issued, the resident company is entitled to require it to be redeemed;
the day on which the security is redeemed; and
the day (if any) on which it is transferred by the resident company.
Subsection (7) below applies where, in the case of a debt which is not a debt on a security, the terms of the debt are such that, if it were such a debt, the security would be an accrued income security.
For the purposes of this section and sections 710 to 728, at any time when the debt is a qualifying debt—
an accrued income security incorporating the terms of the debt shall be deemed to be held by the resident company, and
the debt shall be deemed to be a debt on that security.
Subsections (9) and (10) below shall apply where an accrued income security (including one deemed to be held by virtue of subsection (7) above) is treated by virtue of subsection (1)(c) or (d) above as transferred on any day by the resident company.
In subsection (10) below “straddling period” means a period which would (by virtue of section 711(3) and (4) and apart from subsection (10) below) be in relation to the security an interest period beginning on or before and ending after the day of the transfer.
For the purposes of sections 710 to 728 a straddling period is not an interest period but—
the period beginning with the day on which the straddling period begins and ending with the day of the transfer is an interest period; and
the period beginning with the day immediately following the day of the transfer and ending with the day on which the straddling period ends is an interest period.
In this section— and other expressions to which meanings are assigned for the purposes of those sections have the same meanings as in sections 710 to 728.
provides for that other person to take over any rights and liabilities of the member under any of the syndicates of which he is a member;
In this section and sections 64 and 65 below “the commencement date” means 1st April 1993.
Subsection (2) below applies where the debt on a deep discount security— and in that subsection “the relevant time” means the time mentioned in whichever of paragraphs (a) to (d) above is applicable.
is a qualifying debt at the end of the day immediately preceding the commencement date;
becomes such a debt at any time after that date;
ceases to be such a debt at any such time; or
is such a debt at the end of the last day of any accounting period of the resident company ending after that date;
For the purposes of Schedule 4 to the Taxes Act 1988 (deep discount securities) the resident company shall be deemed—
except in a case falling within paragraph (b) of subsection (1) above, to dispose of the security at the relevant time; and
in a case falling within that paragraph where that company was the holder of the security at a time immediately preceding the relevant time, to dispose of the security at that preceding time.
Subsection (4) below applies where the debt on a deep discount security— and in that subsection “the relevant time” means the time mentioned in whichever of paragraphs (a) to (d) above is applicable.
is a qualifying debt at the beginning of the commencement date;
becomes such a debt at any time after that date;
ceases to be such a debt at any such time; or
is such a debt at the beginning of the first day of any accounting period of the resident company beginning after that date;
For the purposes of Schedule 4 the resident company shall be deemed—
except in a case falling within paragraph (c) of subsection (3) above, to acquire the security at the relevant time; and
in a case falling within that paragraph where that company is the holder of the security at a time immediately following the relevant time, to acquire the security at that following time.
Any income which, apart from this subsection, would be treated as arising at any time by virtue of subsection (1)(a) or (b) above shall be treated as not arising until whichever of the following is the earliest, namely—
the earliest time at which, under the terms on which the security is issued, the resident company is entitled to require it to be redeemed;
the time at which the security is redeemed; and
the time (if any) at which it is transferred by the resident company.
Subsection (7) below applies where, in the case of a debt which is not a debt on a security, the terms of the debt are such that, if it were such a debt, the security would be a deep discount security.
For the purposes of this section and Schedule 4, at any time when the debt is a qualifying debt—
a deep discount security incorporating the terms of the debt shall be deemed to be held by the resident company, and
the debt shall be deemed to be a debt on that security.
In this section expressions to which meanings are assigned for the purposes of Schedule 4 have the same meanings as in that Schedule.
Subsection (2) below applies where the debt on a deep gain security— and in that subsection “the relevant day” means the day mentioned in whichever of paragraphs (a) to (d) above is applicable.
is a qualifying debt at the end of the day immediately preceding the commencement date;
becomes such a debt on any day after that date;
ceases to be such a debt on any such day; or
is such a debt at the end of the last day of any accounting period of the resident company ending after that date;
For the purposes of Schedule 11 to the Finance Act 1989 (deep gain securities) the resident company shall be treated—
except in a case falling within paragraph (b) of subsection (1) above, as transferring the security on the relevant day;
in a case falling within that paragraph where the resident company was the holder of the security on the day immediately preceding the relevant day, as transferring the security on that preceding day; and
(in either case) as obtaining in respect of the transfer an amount equal to the market value of the security at the time of the transfer.
Subsection (4) below applies where the debt on a deep gain security— and in that subsection “the relevant day” means the day mentioned in whichever of paragraphs (a) to (d) above is applicable.
is a qualifying debt at the beginning of the commencement date;
becomes such a debt on any day after that date;
ceases to be such a debt on any such day; or
is such a debt at the beginning of the first day of any accounting period of the resident company beginning after that date;
For the purposes of Schedule 11 the resident company shall be treated—
except in a case falling within paragraph (c) of subsection (3) above, as acquiring the security on the relevant day;
in a case falling within that paragraph where the resident company is the holder of the security on the day immediately following the relevant day, as acquiring the security on that following day; and
(in either case) as paying in respect of the acquisition an amount equal to the market value of the security at the time of the acquisition.
Any income which, apart from this subsection, would be treated as arising on any day by virtue of subsection (1)(a) or (b) above shall be treated as not arising until whichever of the following is the earliest, namely—
the earliest day on which, under the terms on which the security is issued, the resident company is entitled to require it to be redeemed;
the day on which the security is redeemed; and
the day (if any) on which it is transferred by the resident company.
Subsection (7) below applies where, in the case of a debt which is not a debt on a security, the terms of the debt are such that, if it were such a debt, the security would be a deep gain security.
For the purposes of this section and Schedule 11, at any time when the debt is a qualifying debt—
a deep gain security incorporating the terms of the debt shall be deemed to be held by the resident company, and
the debt shall be deemed to be a debt on that security.
Any reference in this section to Schedule 11 is a reference to that Schedule as it would have effect if paragraphs 1(4)(c) and 22 (exclusion of qualifying indexed securities and special rules for such securities) were omitted; but no income accruing before the commencement date in respect of the debt on a qualifying indexed security shall be chargeable to tax by virtue of this section.
In this section expressions to which meanings are assigned for the purposes of Schedule 11 have the same meanings as in that Schedule.
In any case where— the resident company shall not be chargeable to tax in respect of any income treated as arising by virtue of the transfer for the purposes of sections 710 to 728.
by virtue of sections 63(2) and 65(2) above, a single security is treated as transferred both for the purposes of sections 710 to 728 of the Taxes Act 1988 and for the purposes of Schedule 11 to the Finance Act 1989; and
the transfer for the purposes of that Schedule is one to which paragraph 5 of that Schedule applies,
In any case where, by virtue of sections 63(7) and 65(7) above, the same qualifying debt is deemed to be a debt on two separate securities, those securities shall be treated as a single security for the purposes of subsection (1) above.
In any case where, by virtue of subsection (7) of section 63, 64 or 65 above, a qualifying debt is deemed to be a debt on a security, any income which is chargeable to tax as income treated as arising to the resident company by virtue of that section shall not also be chargeable to tax as income actually arising.
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In section 339 of the Taxes Act 1988 (charges on income: donations to charity) in subsection (3A) (payment by close company not a qualifying donation if less than £400 after deducting income tax) for “£400” there shall be substituted “£250”.
In section 25 of the Finance Act 1990 (donations to charity by individuals) in subsection (2)(g) (gift must be not less than £400 to be a qualifying donation) for “£400” there shall be substituted “£250”.
Subsection (1) above shall apply in relation to payments made on or after 16th March 1993.
Subsection (2) above shall apply in relation to gifts made on or after 16th March 1993.
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In section 202(7) of the Taxes Act 1988 (which limits to £600 the deductions attracting relief) for “£600” there shall be substituted “£900”.
This section shall have effect for the year 1993-94 and subsequent years of assessment.
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In Schedule 6 to the Taxes Act 1988 (taxation of directors and others in respect of cars) for Part I (tables of flat rate cash equivalents) there shall be substituted—
This section shall have effect for the year 1993-94.
Cylinder capacity of car in cubic centimetres Cash equivalent 1,400 or less £600 More than 1,400 but not more than 2,000 £760 More than 2,000 £1,130 Cylinder capacity of car in cubic centimetres Cash equivalent 2,000 or less £550 More than 2,000 £710 Original market value of car Cash equivalent Less than £6,000 £600 £6,000 or more but less than £8,500 £760 £8,500 or more £1,130
In subsection (5) of that section (reductions in cash equivalents) the words “or 3” shall be omitted.
This section shall have effect for the year 1993-94.
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In the Taxes Act 1988, after section 159AB (inserted by Schedule 4 to this Act) there shall be inserted the following section—
In section 159A of that Act (mobile telephones) in subsection (8)(a) (meaning of “mobile telephone”), as amended by Schedule 4 to this Act—
the word “but” at the end of sub-paragraph (i) shall be omitted,
after that sub-paragraph there shall be inserted the following sub-paragraph—, and
or heavier commercial vehicle
This section shall have effect for the year 1993-94 and subsequent years of assessment.
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After section 197F of the Taxes Act 1988 there shall be inserted the following section—
This section shall apply for the year 1993-94 and subsequent years of assessment.
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is chargeable to income tax under Case V of Schedule D;
is such that, being a dividend or other distribution of a company not resident in the United Kingdom, it would be chargeable under Schedule F if the company were so resident; and
is not such that tax is chargeable by virtue of section 65(5)(b) of that Act on the full amount of the actual sums received in the United Kingdom.
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in subsection (4)— and
for the words “basic rate”, in each place where they occur, there shall be substituted “lower rate”; and
in paragraph (c), for “which is not chargeable at the lower rate and” there shall be substituted “to which (without prejudice to paragraph (a) above) section 207A shall be taken to apply as it applies to income chargeable under Schedule F, but shall be treated”;
in subsection (6)(b), for “basic rate” there shall be substituted “lower rate”.
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in paragraph (a), after “tax” there shall be inserted “at the lower rate”;
in paragraph (b), for “basic rate” there shall be substituted “lower rate”; and
in paragraph (c), for the words from “which is not” to “that paragraph” there shall be substituted “to which (without prejudice to paragraph (b) above) section 207A shall be taken to apply as it applies to income chargeable under Schedule F, but, notwithstanding the preceding provisions of this subsection”.
This section shall apply in relation to the year 1993-94 and subsequent years of assessment.
In subsection (3) of section 14 of the Taxes Act 1988 (fraction for the purposes of advance corporation tax), in the words after the formula, for “is the percentage at which income tax at the basic rate” there shall be substituted “for the financial year 1993 is 22.5 and for any subsequent financial year is the percentage at which income tax at the lower rate”.
Subsection (1) above shall have effect, subject to section 246(6) of that Act and the following provisions of this section, in relation to the financial year 1993 and subsequent financial years.
Subject to the following provisions of this section, the Tax Acts shall have effect in the case of any distribution in relation to which the rate of advance corporation tax is calculated by reference to the figure fixed by virtue of subsection (1) above for the financial year 1993 as if the amount of the tax credit to which the recipient of the distribution is entitled were to be calculated under section 231(1) of the Taxes Act 1988 on the basis of a rate of advance corporation tax calculated for that financial year by reference to the lower rate for the year 1993-94, rather than by reference to the figure fixed by virtue of subsection (1) above.
Subject to the following provisions of this section—
subsection (3) above shall not apply in relation to the determination of the amount of any tax credit which under section 238(1) of the Taxes Act 1988 is to be aggregated with the amount or value of any distribution for the purpose of calculating the amount of any franked investment income; but
references in any enactment to the payment of a tax credit comprised in any franked investment income, or to the payment of a tax credit in respect of any such income, shall have effect, in relation to any franked investment income the amount of which is calculated in accordance with paragraph (a) above, as references to the payment of the amount of that credit as determined in accordance with subsection (3) above.
Subsections (6) to (11) below shall have effect for the purposes of references in the Tax Acts to franked investment income so far as those references relate to income consisting of distributions in the case of which there is a difference by virtue of subsections (3) and (4) above between—
the amount of the tax credits determined in respect of the distributions in accordance with subsection (3) above; and
the amount of those tax credits so far as they are comprised for the purposes of section 238(1) of the Taxes Act 1988 in that franked investment income.
Subject to the following provisions of this section, in sections 13(7), 236(5), 434, 438, 458, 490 and 802 of, and paragraph 1(8) of Schedule 19AB to, the Taxes Act 1988 (references to the profits of small companies, exempt funds, mutual businesses and certain insurance businesses), and in section 89 of the Finance Act 1989 (policyholders' share of profits), references to franked investment income shall be construed as references to franked investment income calculated using tax credits of amounts determined in accordance with subsection (3) above, instead of as references to franked investment income calculated in accordance with subsection (4)(a) above.
Sections 241(5), 438(5) and 441A(8) of the Taxes Act 1988 (use of franked investment income) and section 89(8) of the Finance Act 1989 (definition of “unrelieved” franked investment income) shall have effect as if the amounts specified in paragraphs (a) and (b) of subsection (5) above were the same so that, if— there shall be no further amount of tax credits comprised in the franked investment income consisting of those distributions which is available for use for franking distributions or, as the case may be, which is unrelieved.
tax credits determined in respect of any distributions in accordance with subsection (3) above have been paid, or
in the case of section 441A(8), tax credits so determined are payable,
Where— that claim shall be treated as confined to what would have been the amount of the surplus if the tax credits comprised in the relevant amount (but no other tax credits comprised in the franked investment income in question) had been of amounts so determined.
a claim is made under section 242(1) or 243(1) of the Taxes Act 1988 (set-off against franked investment income) for any accounting period in relation to any surplus of franked investment income; and
the surplus to which the claim relates is or contains an amount of franked investment income (“the relevant amount”) which represents distributions the tax credits in respect of which are of amounts that would, apart from subsection (4)(a) above, be determined in accordance with subsection (3) above,
Where— the amount to be so carried forward shall be further reduced by the amount representing the difference between an amount of franked investment income equal to the reduction in pursuance of the claim and calculated with subsection (3) above applying for determining the amount of tax credits comprised in it and the equivalent amount of franked investment income calculated without regard to that subsection.
for any accounting period there is a claim under section 242(1) or 243(1) of the Taxes Act 1988 to which subsection (8) above applies, and
apart from this subsection there would, after any reduction in pursuance of the claim, be an amount falling under section 241(3) of that Act to be carried forward as a surplus of franked investment income to any subsequent accounting period,
Without prejudice to subsection (8) above, the reference in section 243(1) of the Taxes Act 1988 to the amount up to which a surplus of franked investment income may be taken into account under section 393(1) of that Act shall have effect as if franked investment income taken into account by virtue of section 393(8) of that Act were to be calculated using tax credits of amounts determined in accordance with subsection (3) above.
Subsection (6) above shall not apply to the references to franked investment income in section 434(3) of the Taxes Act 1988 (policy-holder’s share not to be used for franking); but this subsection shall be without prejudice to the effect of subsections (8) and (9) above in relation to a case in which a surplus of franked investment income for any accounting period is determined in accordance with section 434(3) of that Act.
In section 246 of the Taxes Act 1988 (charge of ACT at previous rate), in subsections (1), (2) and (4), for the words “basic rate”, wherever they occur, there shall be substituted “lower rate”.
Subsection (12) above shall have effect in relation to the financial year 1994 and subsequent financial years.
Schedule 6 to this Act (which makes further provision for the purposes of and in connection with the provisions of sections 77 and 78 above) shall have effect.
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the repeal of paragraph (b) which was made by Part V of Schedule 17 to the Finance Act 1989 in relation to accounting periods beginning after 31st March 1989 had been confined to the following words in that paragraph, that is to say, “under section 462(2) as applied by section 686(4) or”; and
that subsection included the following paragraph—.
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In any case where— the section 505 body, on a claim made under this section to the Board, shall (in addition to its entitlement to payment of the tax credit) be entitled to be paid by the Board out of money provided by Parliament an amount determined in accordance with subsection (2) below.
a qualifying distribution is made on or after 6th April 1993 and before 6th April 1997 by a company resident in the United Kingdom;
the recipient of the distribution is a section 505 body; and
the section 505 body is entitled to the payment of a tax credit in respect of the distribution,
The amount referred to in subsection (1) above is an amount equal to—
one-fifteenth of the amount or value of the distribution if the distribution is made on or after 6th April 1993 and before 6th April 1994;
one-twentieth of that amount or value if the distribution is made on or after 6th April 1994 and before 6th April 1995;
one-thirtieth of that amount or value if the distribution is made on or after 6th April 1995 and before 6th April 1996;
one-sixtieth of that amount or value if the distribution is made on or after 6th April 1996 and before 6th April 1997.
For the purposes of this section each of the following is a section 505 body—
any charity (as defined in section 506(1) of the Taxes Act 1988);
each of the bodies mentioned in section 507 of that Act (heritage bodies);
any Association of a description specified in section 508 of that Act (scientific research organisations).
Any entitlement of a section 505 body to a payment under the preceding provisions of this section shall be subject to a power of the Board to determine (whether before or after any payment is made) that, having regard to the operation in relation to the qualifying distribution in question of section 235, 237 or 703 of the Taxes Act 1988 (distributions of exempt funds, bonus issues and tax avoidance provisions), that body is to be treated as if it had had no entitlement to that payment or to so much of it as they may determine.
No claim may be made under this section later than two years after the end of the chargeable period of the section 505 body in which the distribution is made.
An appeal may be brought against any decision of the Board under this section by giving written notice to the Board within thirty days of receipt of written notice of the decision.
An appeal under this section shall lie to the Special Commissioners, and the provisions of the Taxes Management Act 1970 relating to appeals under the Tax Acts shall apply to an appeal under this section as they apply to those appeals.
Any payment of an amount under this section shall be treated for the purposes of section 252 of the Taxes Act 1988 (rectification of excessive set-off etc. of ACT or tax credit) as a payment of tax credit.
For the year 1993-94 section 3 of the Taxation of Chargeable Gains Act 1992 (annual exempt amount) shall have effect as if the amount specified in subsection (2) were £5,800, and accordingly subsection (3) of that section (indexation) shall not apply for that year.
In section 3(3) of the Taxation of Chargeable Gains Act 1992 (indexation of annual exempt amount) for “December” (in each place) there shall be substituted “ September ”.
This section shall have effect for the year 1994-95 and subsequent years of assessment.
In section 117 of the Taxation of Chargeable Gains Act 1992 (meaning of qualifying corporate bond), after subsection (6) there shall be inserted the following subsection—
In section 251 of that Act (general provisions in relation to debts), after subsection (5) there shall be inserted the following subsection—
This section shall have effect in relation to any chargeable period ending on or after 16th March 1993 but, in relation to any accounting period of a company which began before 6th April 1992, this section shall have effect as if the references in this section, and in the amendments made by this section, to provisions of the Taxation of Chargeable Gains Act 1992 were references to such of the provisions of the Capital Gains Tax Act 1979 and the Finance Act 1984 as correspond to those provisions and have effect in relation to that accounting period.
After subsection (3) of section 151 of the Taxation of Chargeable Gains Act 1992 (personal equity plans) there shall be inserted the following subsection—
In section 155 of the Taxation of Chargeable Gains Act 1992 (classes of assets for the purposes of roll-over relief), after Class 5 there shall be inserted—
The Treasury may by order made by statutory instrument amend section 155 of the Taxation of Chargeable Gains Act 1992 (roll-over relief: relevant classes of assets) so as to add to or amend the classes of assets specified in that section.
A statutory instrument containing an order under subsection (2) above shall be subject to annulment in pursuance of a resolution of the House of Commons.
But an order under subsection (2) may not restrict the assets which fall within a class listed in that section (whether by virtue of subsection (2) or otherwise).
Subsection (1) above shall apply where the disposal of the old assets (or an interest in them) or the acquisition of the new assets (or an interest in them) is on or after 1st January 1993; but, in relation to any accounting period of a company which began before 6th April 1992, subsection (1) above shall have effect as if the inserted class were numbered 5 and were inserted after Class 4 in section 118 of the Capital Gains Tax Act 1979.
An order under subsection (2) may make such consequential amendments of section 156ZB of, or Schedule 7AB to, the Taxation of Chargeable Gains Act 1992 as appear to the Treasury to be appropriate.
Schedule 7 to this Act (which amends the provisions of the Taxation of Chargeable Gains Act 1992 with respect to retirement relief and makes new provision in relation to relief on the re-investment of certain gains) shall have effect.
This section and that Schedule shall have effect in relation to any disposal made on or after 16th March 1993.
After section 177 of the Taxation of Chargeable Gains Act 1992 there shall be inserted the following section—
The Schedule set out in Schedule 8 to this Act shall be inserted after Schedule 7 to that Act.
This section and that Schedule—
shall apply for the calculation of the amount to be included in respect of chargeable gains in a company’s total profits for any accounting period ending on or after 16th March 1993; but
shall so apply only in relation to the deduction from chargeable gains accruing on or after 16th March 1993 of amounts in respect of, or of amounts carried forward in respect of—
pre-entry losses accruing before it became a member of the relevant group to a company whose membership of that group began or begins at a time on or after 1st April 1987; and
losses accruing on the disposal of any assets so far as it is by reference to such a company that the assets fall to be treated as being or having been pre-entry assets or assets incorporating a part referable to pre-entry assets.
In relation to accounting periods beginning before 6th April 1992 this section and that Schedule shall have effect as if—
the section and Schedule inserted by subsections (1) and (2) above were inserted in the Capital Gains Tax Act 1979; and
references in the Schedule so inserted to provisions of the Taxation of Chargeable Gains Act 1992 were references to such of the provisions of that Act of 1979 or of any other enactment as correspond to the provisions referred to and have effect in relation to that accounting period.
and subsection (2) of section 409 of the Taxes Act (group relief) shall require any apportionment under that subsection to be made accordingly but shall not require any reference in this subsection to an accounting period to have effect for any of the purposes specified in subsection (3) of that section as a reference to any accounting period other than a true accounting period.
This section shall have effect in relation to accounting periods ending after the day appointed for the purposes of section 180(1)(b) of that Act.
In section 211 of the Taxation of Chargeable Gains Act 1992 (insurance: transfers of business) in subsection (2)(b) for “(c)” there shall be substituted “(b)”.
This section shall apply in relation to transfers made on or after 17th July 1992.
Section 212 of the Taxation of Chargeable Gains Act 1992 (annual deemed disposal by insurance companies of unit trusts) shall have effect in relation to accounting periods beginning on or after 1st January 1993; and neither that section nor section 46 of the Finance Act 1990 (which is consolidated in that section) shall have effect in relation to any earlier accounting period in relation to which either of them would have applied apart from this subsection.
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section 432A of the Taxes Act 1988 shall have effect with the omission of subsection (10) (which disapplies the apportionment rules in that section in the case of a deemed disposal under section 212 of that Act of 1992); and
that section 212 shall have effect with the omission, in subsection (2), of the words from “and in relation to” onwards and of subsections (3), (4) and (6) (which provide for a different apportionment rule in the case of the deemed disposal).
In subsection (7) of that section 212, in the words after paragraph (b) (application of definitions in the Taxes Act 1988), for “and 214” there shall be substituted “ to 214A ”.
After section 213(1) of that Act of 1992 (spreading of gains and losses), there shall be inserted the following subsection—
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Regulations may provide that where a company carries on a trade the basic profits or losses of the trade for an accounting period shall for the purposes of corporation tax be computed and expressed in such currency (other than sterling) as is found in accordance with prescribed rules, in a case where—
prescribed conditions are fulfilled, and
an election is made by the company in accordance with the regulations and has effect for the accounting period concerned by virtue of the regulations.
For the purposes of this section the basic profits or losses of a trade for an accounting period are all the profits or losses of the trade for the period, but leaving out of account—
any trading receipt of the trade in the period, and any trading expense of the trade in the period, that arises by virtue of section 144(2) of the Capital Allowances Act 1990 (which makes provision about giving effect to allowances and charges);
any amount mentioned in section 142(4) below and treated as received in respect of the trade and in respect of the period.
Subsections (4) and (5) below apply where the basic profits or losses of a trade for an accounting period are for the purposes of corporation tax to be computed and expressed in a currency other than sterling.
The amount of the basic profits or losses shall be treated for the purposes of corporation tax as the sterling equivalent of their amount expressed in the other currency.
The profits or losses of the trade for the period shall for the purposes of corporation tax be found by taking the amount of the basic profits or losses found in sterling under subsection (4) above and then—
taking account of any trading receipt of the trade in the period, and any trading expense of the trade in the period, that arises by virtue of section 144(2) of the Capital Allowances Act 1990, and
taking account (as provided by section 142 below) of any amount mentioned in section 142(4) and treated as received in respect of the trade and in respect of the period.
For the purposes of subsection (4) above the sterling equivalent of an amount is the sterling equivalent calculated by reference to—
such rate of exchange as is found under prescribed rules, or
if no such rules apply in the case concerned, the London closing exchange rate for the last day of the accounting period concerned.
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Regulations may make provision under this section as regards a case where in an accounting period— and “overseas branch” means a branch outside the United Kingdom.
a company carries on part of a trade in the United Kingdom, and carries on a different part of the trade through an overseas branch or different parts through different overseas branches, or
a company carries on different parts of a trade through different overseas branches;
Regulations may provide that the basic profits or losses of different parts of the trade for an accounting period shall for the purposes of corporation tax be computed and expressed in such different currencies as are found in accordance with prescribed rules, in a case where—
prescribed conditions are fulfilled, and
an election is made by the company in accordance with the regulations and has effect for the accounting period concerned by virtue of the regulations.
The regulations must be so framed that—
one currency is used for each part;
at least two currencies are used;
subject to paragraph (b) above, the same currency may be used for more than one part;
if no election is made as regards a particular part, sterling is to be used for that part.
For the purposes of this section the basic profits or losses of part of a trade for an accounting period are all the profits or losses of the part for the period; but this is subject to subsections (5) and (6) below.
No account shall be taken of any trading receipt of the trade in the period, and any trading expense of the trade in the period, that arises by virtue of section 144(2) of the Capital Allowances Act 1990 (which makes provision about giving effect to allowances and charges).
Where the basic profits or losses of the part of the trade for the period are for the purposes of corporation tax to be computed and expressed in a currency other than sterling, no account shall be taken of any amount mentioned in section 142(4) below and treated as received in respect of the part of the trade and in respect of the period.
Where the basic profits or losses of different parts of a trade for an accounting period are for the purposes of corporation tax to be computed and expressed in two or more different currencies, subsections (8) to (10) below have effect for finding the profits or losses of the trade for the period for the purposes of corporation tax.
Where the basic profits or losses of any part are for the purposes of corporation tax to be computed and expressed in a currency other than sterling—
find the sterling equivalent of their amount expressed in the other currency, then
take account (as provided by section 142 below) of any amount mentioned in section 142(4) and treated as received in respect of the part and in respect of the period, then
call the result the accountable profits or losses of the part for the period.
Where the basic profits or losses of any part are for the purposes of corporation tax to be computed and expressed in sterling, take those profits or losses and call them the accountable profits or losses of the part for the period.
The profits or losses of the trade for the period for the purposes of corporation tax shall then be found by—
taking account of the accountable profits or losses of the different parts for the period, and
then taking account of any trading receipt of the trade in the period, and any trading expense of the trade in the period, that arises by virtue of section 144(2) of the Capital Allowances Act 1990.
For the purposes of subsection (8) above the sterling equivalent of an amount is the sterling equivalent calculated by reference to—
such rate of exchange as is found under prescribed rules, or
if no such rules apply in the case concerned, the London closing exchange rate for the last day of the accounting period concerned.
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Regulations under section 93 or 94 above may include— and any provision under paragraph (c) above may allow a notification to be made after the accounting period ends.
provision that an election may in prescribed circumstances have effect from a time before it is made;
provision that prescribed conditions shall be treated as fulfilled in prescribed circumstances (subject to any provision under paragraph (c) below);
provision that prescribed conditions shall be treated as not having been fulfilled if the inspector notifies the company that he is not satisfied that they are fulfilled;
provision for an appeal from the inspector’s notification;
The power to make regulations under section 93 or 94 above shall be exercisable by the Treasury by statutory instrument subject to annulment in pursuance of a resolution of the House of Commons.
In sections 93 and 94 above “prescribed” means prescribed by regulations made under the section concerned.
Where as regards a trade and for an accounting period— no election may be made as regards the trade for the period under regulations made under the other section.
an election is made under regulations made under section 93 above, or
an election is made under regulations made under section 94 above,
For the purposes of sections 93 and 94 above the ecu shall be regarded as a currency other than sterling; and the reference here to the ecu is to the European currency unit as defined for the time being in Council Regulation No. 3180/78/EEC or in any Community instrument replacing it.
Sections 92 to 94 above apply in relation to any accounting period beginning on or after the day appointed under section 165(7)(b) below.
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In Schedule 24 to the Taxes Act 1988 (assumptions for calculating chargeable profits, creditable tax and corresponding United Kingdom tax of foreign companies) the following paragraph shall be inserted after paragraph 4—
This section applies in relation to any accounting period beginning on or after the day appointed under section 165(7)(b) below.
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The following shall be inserted after section 444A of the Taxes Act 1988—
Schedule 9 to this Act (which inserts Schedule 19AC into that Act and makes further provision) shall have effect.
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The following section shall be inserted after section 444B of the Taxes Act 1988—
This section shall apply—
so far as section 440(1) is concerned, as regards events falling on or after the first day of the relevant accounting period of the company concerned;
so far as section 440(2) is concerned, as regards events falling on or after the first day of the relevant accounting period of the transferor company or on or after the first day of the relevant accounting period of the acquiring company (whichever of those days falls later).
For the purposes of subsection (2) above a company’s relevant accounting period is its first accounting period to begin after 31st December 1992.
The following section shall be inserted after section 444C of the Taxes Act 1988—
“UK distribution income” has the meaning given by section 444D(4);
This section shall apply in relation to accounting periods beginning after 31st December 1992.
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In section 475 of that Act (tax-free Treasury securities: exclusion of interest on borrowed money), in subsection (6)—
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for the words “of the life assurance fund”, in each place where they occur, there shall be substituted the words “ attributable to basic life assurance and general annuity business ”.
This section shall apply in relation to accounting periods beginning after 31st December 1992.
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The following section shall be inserted after section 89 of the Finance Act 1989—
Schedule 10 to this Act (which inserts Schedule 8A into that Act) shall have effect.
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The following section shall be inserted after section 214A of the Taxation of Chargeable Gains Act 1992—
Schedule 11 to this Act (which inserts Schedule 7B into that Act) shall have effect.
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The following provisions of that Act shall cease to have effect—
section 445 (charge to tax on investment income of overseas life insurance company);
section 446(1) (qualifying distributions part of profits of pension business of overseas life insurance company);
section 447(1), (2) and (4) (set-off of income tax and tax credits against corporation tax assessed under section 445);
section 448 (qualifying distributions and tax credits);
section 449 (double taxation agreements);
section 724(5) to (8) (special provisions of accrued income scheme for overseas life insurance companies);
section 811(2)(c) (provision about deduction of foreign tax not to affect overseas life insurance company charged under section 445);
paragraph 1(9) of Schedule 19AB (payments on account of tax credits in case of pension business: special provision for overseas life insurance companies).
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in relation to that excess; and
if it would have so applied apart from this section.
After section 149 of the Taxation of Chargeable Gains Act 1992 there shall be inserted the following section—
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for the words “section 185(6)” there shall be substituted the words “the applicable provision”, and
at the end there shall be inserted ; and in this subsection “the applicable provision” means—
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In section 32A(5) of the Capital Gains Tax Act 1979 (expenditure: amounts to be included as consideration)—
for the words “section 185(6)” there shall be substituted the words “ the applicable provision ”, and
at the end there shall be inserted; and in this subsection “the applicable provision” means—
The amendments made by subsection (3) above shall be deemed to have come into force on 1st January 1992 (but shall have effect subject to the repeals made by the Taxation of Chargeable Gains Act 1992).
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The Taxes Act 1988 shall be amended as mentioned in subsections (2) to (6) below.
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in subsection (4) (indexation of income tax bands) for “December” (in each place) there shall be substituted “September”;
subsection (5) (no change required for PAYE before 18th May) shall be omitted.
In section 257C—
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subsection (2) (no change required for PAYE before 18th May) shall be omitted.
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This section shall have effect for the year 1994-95 and subsequent years of assessment.
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In section 91A(6) of the Taxes Act 1988 (relevant licence for the purposes of restoration payments), after paragraph (b) there shall be inserted or
In section 91B of that Act (preparation expenditure for waste disposal), after subsection (10) there shall be inserted the following subsection—
This section shall have effect in relation to any case where the trade in question is begun after 31st March 1993.
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After section 299 of the Taxes Act 1988 there shall be inserted the following section—
In sections 289(12)(a) and 310(1) and (10)(a) of that Act (definition of “the relevant period” and information provisions), after “299,”, in each case, there shall be inserted “299A,”.
In section 307(6) of that Act (reckonable date for the purposes of interest on relief that is withdrawn), after paragraph (c) there shall be inserted the following paragraph—.
This section shall apply in relation to any case in which the claim for relief is made on or after 16th March 1993.
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In section 592(4) of the Taxes Act 1988 (employers' contributions to exempt approved schemes), at the end there shall be inserted “but no other sum shall for those purposes be allowed to be deducted as an expense, or expense of management, in respect of the making, or any provision for the making, of any contributions under the scheme.”
Subsection (1) above shall have effect in the case of any employer in relation to, as the case may be—
any accounting period of that employer ending with a day after 5th April 1993; or
any year of assessment the employer’s basis period for which ends with a day after that date.
Where— the amount allowed to be so deducted in respect of the payment mentioned in paragraph (a) above and of any other actual payments of contributions under the scheme which, having been made after 5th April 1993, fall within paragraph (b) above in relation to the same chargeable period shall be reduced by whichever is the smaller of the excess and the amount which reduces the deduction to nil.
there is after 5th April 1993 an actual payment by an employer of a contribution under an exempt approved scheme,
that payment would, apart from this subsection, be allowed to be deducted as an expense, or expense of management, of the employer in relation to any chargeable period in relation to which subsection (1) above has effect, and
the total of previously allowed deductions exceeds the relevant maximum,
In relation to any such actual payment by an employer of a contribution under an exempt approved scheme as would be allowed to be deducted as mentioned in subsection (3) above in relation to any chargeable period- and for the purposes of this subsection an amount the deduction of the whole or any part of which falls to be taken into account as allowed in relation to more than one chargeable period shall be treated as if the amount allowed were a different amount in the case of each of those periods.
the reference in that subsection to the total of previously allowed deductions is a reference to the aggregate of every amount in respect of the making, or any provision for the making, of that or any other contributions under the scheme, which has been allowed to be deducted as an expense, or expense of management, of that person in relation to a previous chargeable period; and
the reference to the relevant maximum is a reference to the amount which would have been that aggregate if the restriction on deductions imposed by virtue of subsection (1) above had been applied in relation to every previous chargeable period;
For the purposes of this section any payment which is treated under subsection (6) of section 592 of the Taxes Act 1988 as spread over a period of years shall be treated as actually paid at the time when it is treated as paid in accordance with that subsection.
After subsection (6) of section 592 of the Taxes Act 1988 there shall be inserted the following subsection—; and this subsection shall have effect in relation to any payment made on or after the day on which this Act is passed.
In this section—
“the syndicate capacity disposal” has the meaning given by paragraph 6(3) above.
in any other case, his final year of assessment.
in relation to an underwriting year, means the underwriting year next but one following that year; and
This paragraph applies where a member ceases to carry on his underwriting business,whether by reason of death or otherwise. In computing for the purposes of income tax the profits of the member’s underwriting business for the relevant year of assessment, any payment under paragraph 7(1) above (except where they are also made under paragraph 6(2) above)which is made to him or his personal representatives or assigns out of his special reserve fund shall be treated— Where the member ceases to carry on his underwriting business by reason of his death, any payment falling within sub-paragraph (2) above shall be treated, for the purposes of sections 59C and 86 of the Management Act , as if made immediately after the commencement of his final year of assessment. The amount referred to in sub-paragraph (2) above is the value of the fund, as determined under paragraph 6(1) above for the penultimate underwriting year and— Where an asset is transferred to the member or his personal representatives or assigns under paragraph 7(1) above or otherwise than out of his special reserve fund, the transfer shall be treated, for the purposes of the Gains Tax Acts —
“syndicate” means a syndicate of underwriting members of Lloyd’s formed for an underwriting year;
if two or more such persons were so acting and none of them was so appointed, the person who was so acting for the member in his capacity as a member of the syndicate, or
In Chapter I of Part I of the Capital Allowances Act 1990, after section 2 there shall be inserted the following section—
In section 4(9) of that Act, in the definition of “capital expenditure”, for “or 10B” there shall be substituted “10B or 10C”.
In section 10(3A) of that Act (provisions not to apply in cases falling within section 10A)—
after “apply” there shall be inserted “for the purpose of determining whether any expenditure is expenditure to which section 2A applies or”; and
after “10A” there shall be inserted “or 10C”.
After section 10B of that Act there shall be inserted the following section—
In section 17A of that Act (exclusion of expenditure incurred more than 20 years after a site is included in an enterprise zone), after “sections 1(1)(b)” there shall be inserted “2A(5)(a)”.
In section 18(14) of that Act (application of section 18(13) to certain buildings), for “qualifying hotels to which this Part applies by virtue of section 7” there shall be substituted “any qualifying hotel”.
This section shall have effect in relation to every chargeable period which, or the basis period for which, ends after 31st October 1992.
Schedule 12 to this Act (which makes provision, which broadly corresponds to that made in relation to industrial buildings and structures by section 113 above, for the making of initial allowances in respect of expenditure on the construction of agricultural buildings, fences and other works) shall have effect.
This section and the amendments made by Schedule 12 to this Act shall have effect in relation to every chargeable period which, or the basis period for which, ends after 31st October 1992.
In subsection (1) of section 22 of the Capital Allowances Act 1990 (first-year allowances), in the words after paragraph (b), after “which” there shall be inserted “, in the case of expenditure to which this section applies by virtue only of subsection (3B) below, shall be of an amount equal to 40 per cent. of that expenditure and, in any other case,”.
After subsection (3A) of that section there shall be inserted the following subsection—
In subsection (4)(c) of that section (no first-year allowance on the provision of machinery or plant for leasing), after “(6)” there shall be inserted “(6A)”; and after subsection (6) of that section there shall be inserted the following subsection—
Schedule 13 to this Act (which makes further amendments of that Act of 1990 in connection with the first-year allowances for which provision is made by this section) shall have effect.
This section and the amendments made by Schedule 13 to this Act shall have effect (subject to paragraph 12(3) of that Schedule) in relation to every chargeable period which, or the basis period for which, ends after 31st October 1992.
In the second sentence in section 40(4) of the Capital Allowances Act 1990 (shortening of “requisite period” while assets used for qualifying purpose), after “effect” there shall be inserted “for the purposes of sections 31(2) and 37(6)”.
In section 42(1) of that Act (assets leased to non-residents), for paragraph (b) there shall be substituted the following paragraph—.
In section 50 of that Act (interpretation of Chapter V), after subsection (3) there shall be inserted the following subsection—
This section shall have effect in relation to the use of machinery or plant for leasing under leases entered into on or after 16th March 1993.
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Section 158 of the Capital Allowances Act 1990 (election exercisable in the case of transactions between connected persons etc.) shall be amended as follows.
In paragraph (a) of subsection (2) (sum at which industrial building or structure is treated as sold)—
after the word “structure,”, in the first place where it occurs, there shall be inserted “a qualifying hotel or a commercial building or structure,”; and
for the words “or structure”, in the second place where they occur, there shall be substituted “structure or hotel”.
After paragraph (c) of that subsection there shall be inserted the following paragraph—
In subsection (3) (cases where election may not be made), for paragraph (a) there shall be substituted the following paragraph—.
This section shall have effect in relation to sales and other transfers on or after 16th March 1993 other than one which is in pursuance of—
a contract entered into before that date; or
a contract entered into for the purpose of securing that obligations under a contract entered into before that date are complied with.
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Where— the rights of that beneficiary shall be deemed for the purposes of the Income Tax Acts to include such a right to that income notwithstanding that no such right is conferred according to the law of Scotland.
any of the income of a trust having effect under the law of Scotland is income to which a beneficiary of the trust would have an equitable right in possession if that trust had effect under the law of England and Wales, and
the trustees of that trust are resident in the United Kingdom,
This section shall have effect in relation to the income of any trust for the year 1993–94 or any subsequent year of assessment.
In section 750(1) of the Taxes Act 1988 (meaning of lower level of taxation for purposes of provisions relating to controlled foreign companies) for “one-half” there shall be substituted “ three-quarters ”.
Subsection (1) above shall apply in relation to accounting periods beginning on or after 16th March 1993.
Where a company is by virtue of section 749(1) or (2) of the Taxes Act 1988 regarded as resident in a territory outside the United Kingdom and (apart from this section)— for the purposes of Chapter IV of Part XVII of that Act that accounting period shall be treated as ending on 15th March 1993.
an accounting period of the company would begin before 16th March 1993 and end on or after that date, and
the company would not be considered to be subject, by virtue of section 750(1) of that Act, to a lower level of taxation in that accounting period in the territory in which it is regarded as resident,
Schedule 14 to this Act (which makes various amendments of the Taxes Management Act 1970, the Taxes Act 1988 and the Finance Act 1989 with a view to, or in connection with, the introduction of “pay and file”) shall have effect.
The Treasury may by regulations provide, in relation to accounting periods beginning on or after 1st January 1994, for Schedule 19AB of the Taxes Act 1988 (payments on account of exempt pension business) to have effect, with such modifications and exceptions as may be specified in the regulations, in relation to any business to which this section applies as it has effect in relation to the pension business of an insurance company.
This section applies to any business of a friendly society the profits arising from which are exempt from income tax and corporation tax under section 460(1), 461(1) or 461B(1) of the Taxes Act 1988 (life or endowment and other business), not being a business carried on by a friendly society all of whose profits are so exempt.
Regulations under this section may make different provision for different cases.
This section shall be without prejudice to section 463(1) of the Taxes Act 1988 (application of the Corporation Tax Acts to life or endowment business carried on by friendly societies).
In subsection (2) of section 829 of the Taxes Act 1988 (restriction on application of Income Tax Acts to public departments), at the end there shall be inserted “ unless it is tax which would not have been so borne but for a failure by a public office or department of the Crown to make a deduction required by virtue of subsection (1) above. ”
The provisions of Parts IX and X of the Taxes Management Act 1970 (interest and penalties) shall apply in relation to public offices and departments of the Crown for the purposes, so far as they so apply, of the other provisions of that Act and of the provisions of the Income Tax Acts mentioned in section 829(1) of the Taxes Act 1988.
This section shall have effect in relation to the year 1993-94 and subsequent years of assessment.
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The following section shall be inserted after section 577 of the Taxes Act 1988—
This section shall apply in relation to expenditure incurred on or after 11th June 1993.
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Section 200 of the Taxes Act 1988 (expenses of Members of Parliament) shall become subsection (1) of that section and the following subsection shall be inserted after that subsection—
This section shall apply in relation to sums paid on or after 1st January 1992.
Any such adjustment (whether by way of discharge or repayment of tax, the making of an assessment or otherwise) as is appropriate in consequence of this section may be made.
Subsection (2) below applies where a qualifying company holds a qualifying asset and there is a difference between—
the local currency equivalent, at the translation time with which an accrual period as regards the asset begins, of the basic valuation of the asset, and
the local currency equivalent, at the translation time with which the accrual period ends, of the basic valuation of the asset.
There is as regards the asset an exchange difference for the accrual period, and—
if the difference represents an increase over the period, an initial exchange gain of an amount equal to the difference accrues to the company as regards the asset for the period;
if the difference represents a decrease over the period, an initial exchange loss of an amount equal to the difference accrues to the company as regards the asset for the period.
Subsection (4) below applies where a qualifying company owes a qualifying liability and there is a difference between—
the local currency equivalent, at the translation time with which an accrual period as regards the liability begins, of the basic valuation of the liability, and
the local currency equivalent, at the translation time with which the accrual period ends, of the basic valuation of the liability.
There is as regards the liability an exchange difference for the accrual period, and—
if the difference represents a decrease over the period, an initial exchange gain of an amount equal to the difference accrues to the company as regards the liability for the period;
if the difference represents an increase over the period, an initial exchange loss of an amount equal to the difference accrues to the company as regards the liability for the period.
This section applies where a qualifying company enters into a contract (a currency contract) under which—
it becomes entitled to a right and subject to a duty to receive payment at a specified time of a specified amount of one currency (the first currency), and
it becomes entitled to a right and subject to a duty to pay in exchange and at the same time a specified amount of another currency (the second currency).
Subsection (3) below applies if there is a difference between—
the local currency equivalent, at the translation time with which an accrual period as regards the contract begins, of the amount of the first currency, and
the local currency equivalent, at the translation time with which the accrual period ends, of the amount of the first currency.
There is as regards the contract an exchange difference for the accrual period, and—
if the difference represents an increase over the period, an initial exchange gain of an amount equal to the difference accrues to the company as regards the contract for the period;
if the difference represents a decrease over the period, an initial exchange loss of an amount equal to the difference accrues to the company as regards the contract for the period.
Subsection (5) below applies if there is a difference between—
the local currency equivalent, at the translation time with which an accrual period as regards the contract begins, of the amount of the second currency, and
the local currency equivalent, at the translation time with which the accrual period ends, of the amount of the second currency.
There is as regards the contract an exchange difference for the accrual period, and—
if the difference represents a decrease over the period, an initial exchange gain of an amount equal to the difference accrues to the company as regards the contract for the period;
if the difference represents an increase over the period, an initial exchange loss of an amount equal to the difference accrues to the company as regards the contract for the period.
In a case where— the following provisions of this section shall apply for the period and section 125 above shall not.
a qualifying company holds an asset consisting of a right to settlement under a qualifying debt or owes a liability consisting of a duty to settle under such a debt, and
the nominal amount of the debt outstanding varies during an accrual period (whether because of an increase or a decrease or both),
In such a case—
take the local currency equivalent, at the translation time with which the accrual period begins, of the nominal amount of the debt then outstanding;
take the local currency equivalent, at each time (if any) immediately after the nominal amount of the debt outstanding increases in the accrual period, of the amount by which it then increases;
take the local currency equivalent, at each time (if any) immediately after the nominal amount of the debt outstanding decreases in the accrual period, of the amount by which it then decreases;
take the figure found under paragraph (a) above, add each figure found under paragraph (b) above, subtract each figure found under paragraph (c) above, and call the resulting figure the first amount;
take the local currency equivalent, at the translation time with which the accrual period ends, of the nominal amount of the debt then outstanding, and call the figure so found the second amount.
Where the qualifying company has a right to settlement under the debt the following provisions apply in relation to the asset consisting of the right—
if the second amount exceeds the first an initial exchange gain of an amount equal to the difference between them accrues to the company as regards the asset for the accrual period;
if the second amount is less than the first an initial exchange loss of an amount equal to the difference between them accrues to the company as regards the asset for the accrual period.
Where the qualifying company has a duty to settle under the debt the following provisions apply in relation to the liability consisting of the duty—
if the second amount is less than the first an initial exchange gain of an amount equal to the difference between them accrues to the company as regards the liability for the accrual period;
if the second amount exceeds the first an initial exchange loss of an amount equal to the difference between them accrues to the company as regards the liability for the accrual period.
If the first amount has a negative value, for the purposes of this section the second amount (however small its value) shall be taken to exceed the first amount (however large its value).
Subsection (7) below modifies the preceding provisions of this section in their application to an asset or liability where there is a difference between—
the basic valuation of the asset or liability, and
the nominal amount of the debt outstanding at the translation time with which the accrual period begins.
In such a case—
the reference in subsection (2)(a) above to the nominal amount of the debt outstanding shall be taken to be a reference to the basic valuation of the asset or liability;
the reference in subsection (2)(c) above to the amount by which the nominal amount of the debt outstanding decreases shall be taken to be a reference to the amount found under subsection (8) below;
the reference in subsection (2)(e) above to the nominal amount of the debt outstanding shall be taken to be a reference to the amount found under subsection (10) below.
The amount referred to in subsection (7)(b) above is the amount given by the formula—
For the purposes of subsection (8) above— A is the basic valuation of the asset or liability; B is the amount by which, at the time of the decrease mentioned in subsection (2)(c) above, the nominal amount of the debt outstanding then decreases; C is the nominal amount of the debt outstanding at the translation time with which the accrual period begins.
The amount referred to in subsection (7)(c) above is the amount given by the formula—
For the purposes of subsection (10) above— D is the basic valuation of the asset or liability; E is the amount (if any) by which the nominal amount of the debt outstanding has at any time increased in the accrual period or, if it has increased more than once, the aggregate of such amounts; F is the amount (if any) found under subsection (8) above or, if the nominal amount of the debt outstanding has decreased more than once in the accrual period, the aggregate of the amounts so found.
Subsections (2) to (4) below apply where—
as regards an asset, liability or contract an initial exchange gain accrues to a qualifying company for an accrual period, and
at any time in the period the asset or contract was held, or the liability was owed, by the company for the purposes of a trade or part of a trade carried on by it.
If throughout the accrual period the asset or contract was held, or the liability was owed, by the company solely for the purposes of the trade or part the whole of the gain is an exchange gain of the trade or part for the period.
In any other case the gain shall be apportioned on a just and reasonable basis and so much as is attributable to the trade or part is an exchange gain of the trade or part for the period.
The company shall be treated for the purposes of the Tax Acts as—
receiving in respect of the trade or part an amount equal to the exchange gain of the trade or part for the accrual period, and
receiving the amount in respect of the accounting period which constitutes the accrual period or in which the accrual period falls.
Subsections (6) to (8) below apply where—
as regards an asset, liability or contract an initial exchange loss accrues to a qualifying company for an accrual period, and
at any time in the period the asset or contract was held, or the liability was owed, by the company for the purposes of a trade or part of a trade carried on by it.
If throughout the accrual period the asset or contract was held, or the liability was owed, by the company solely for the purposes of the trade or part the whole of the loss is an exchange loss of the trade or part for the period.
In any other case the loss shall be apportioned on a just and reasonable basis and so much as is attributable to the trade or part is an exchange loss of the trade or part for the period.
The company shall be treated for the purposes of the Tax Acts as—
incurring in the trade or part a loss of an amount equal to the exchange loss of the trade or part for the accrual period, and
incurring the loss in respect of the accounting period which constitutes the accrual period or in which the accrual period falls.
For the purposes of this section a part of a trade is any part of a trade whose basic profits or losses for the relevant accounting period are by virtue of regulations under section 94 above to be computed and expressed in a particular currency for the purposes of corporation tax; and the relevant accounting period is the accounting period which constitutes the accrual period concerned or in which that accrual period falls.
The preceding provisions of this section apply—
whether the asset or contract is at any time held, or the liability is at any time owed, on revenue account or capital account, and
notwithstanding anything in section 74 of the Taxes Act 1988 (general rules as to deductions not allowable).
In a case where— the gain or loss shall be left out of account in calculating the profits or losses.
an accounting period of a qualifying company begins on or after its commencement day, and
but for this subsection, a gain or loss falling within subsection (12) below would be taken into account in calculating for the purposes of corporation tax the profits or losses for the period of a trade carried on by the company,
A gain or loss falls within this subsection if it— and it is immaterial whether the gain or loss is realised.
accrues to the company, otherwise than by virtue of this Chapter, as regards a qualifying asset or liability or a currency contract, and
is attributable to fluctuations in currency exchange rates;
In a case where— the whole or part (as the case may be) is a non-trading exchange gain for the period.
as regards an asset, liability or contract an initial exchange gain accrues to a qualifying company for an accrual period, and
the whole or part of the gain is not an exchange gain of a trade or part of a trade for the period,
The company shall be treated as— and (subject to subsection (6) below) the rules in sections 130 to 133 below shall apply.
receiving in respect of the asset, liability or contract an amount equal to the non-trading exchange gain for the accrual period, and
receiving the amount in the accounting period which constitutes the accrual period or in which the accrual period falls;
In a case where— the whole or part (as the case may be) is a non-trading exchange loss for the period.
as regards an asset, liability or contract an initial exchange loss accrues to a qualifying company for an accrual period, and
the whole or part of the loss is not an exchange loss of a trade or part of a trade for the period,
The company shall be treated as— and (subject to subsection (6) below) the rules in sections 130 to 133 below shall apply.
incurring in respect of the asset, liability or contract a loss of an amount equal to the non-trading exchange loss for the accrual period, and
incurring the loss in the accounting period which constitutes the accrual period or in which the accrual period falls;
For the purposes of subsection (6) below and sections 130 to 133 below, in relation to an accounting period—
amount A is the amount a company is treated as receiving in the accounting period by virtue of this section or (if it is treated as so receiving two or more amounts) the aggregate of those amounts;
amount B is the amount of the loss a company is treated as incurring in the accounting period by virtue of this section or (if it is treated as so incurring two or more losses) the aggregate of the amounts of those losses.
In a case where— the rules in sections 130 to 133 below shall not apply.
a company is treated as receiving in an accounting period an amount or amounts by virtue of this section,
it is treated as incurring in the accounting period a loss or losses by virtue of this section, and
amount A is equal to amount B,
In a case where— the non-trading exchange gain or loss shall be treated as not accruing.
a non-trading exchange gain or loss would (apart from this subsection) accrue as regards an asset consisting of a right to settlement under a qualifying debt, and
the right is a right to receive income (whether interest, dividend or otherwise),
In a case where— the non-trading exchange gain or loss shall be treated as not accruing.
a non-trading exchange gain or loss would (apart from this subsection) accrue to a company as regards a liability consisting of a duty to settle under a qualifying debt, and
a charge is allowed to the company in respect of the debt under section 338 of the Taxes Act 1988 (allowance of charges on income and capital) or the circumstances are such that a charge would be so allowed if the duty were settled,
Section 396 of the Taxes Act 1988 (Case VI losses) shall not be taken to apply to a loss which a company is treated as incurring by virtue of this section; and an amount which a company is treated as receiving by virtue of this section shall not be regarded, for the purposes of subsection (1) of section 396, as income arising as mentioned in that subsection.
Subsection (2) below applies where—
a company is treated as receiving in an accounting period an amount or amounts by virtue of section 129 above, and
it is not treated as incurring in the accounting period any loss by virtue of that section.
The company shall be treated as receiving in the accounting period annual profits or gains of an amount equal to amount A, and the profits or gains shall be chargeable to tax under Case VI of Schedule D for the accounting period.
Subsection (4) below applies where—
a company is treated as receiving in an accounting period an amount or amounts by virtue of section 129 above,
it is treated as incurring in the accounting period a loss or losses by virtue of that section, and
amount A exceeds amount B.
The company shall be treated as receiving in the accounting period annual profits or gains of an amount equal to amount A minus amount B, and the profits or gains shall be chargeable to tax under Case VI of Schedule D for the accounting period.
This section applies where— and where this section applies by virtue of this subsection references to the relievable amount for the accounting period are to an amount equal to amount B.
a company is treated as incurring in an accounting period a loss or losses by virtue of section 129 above, and
it is not treated as receiving in the accounting period any amount by virtue of that section;
This section also applies where— and where this section applies by virtue of this subsection references to the relievable amount for the accounting period are to an amount equal to amount B minus amount A.
a company is treated as incurring in an accounting period a loss or losses by virtue of section 129 above,
it is treated as receiving in the accounting period an amount or amounts by virtue of that section, and
amount B exceeds amount A;
The company may claim under this subsection that the whole or part of the relievable amount for an accounting period shall be treated for the purposes of section 403(1) of the Taxes Act 1988 (group relief) as if it were a loss incurred by the company in the period in carrying on a trade, and in such a case section 403(2) (exclusions) shall not apply.
The company may claim under this subsection that the whole or part of the relievable amount for an accounting period shall be set off for the purposes of corporation tax against profits (of whatever description) of that accounting period; and in such a case, subject to any relief for a loss incurred in a trade in an earlier accounting period, those profits shall then be treated as reduced accordingly.
Where a company has made no claim under subsection (3) or (4) above as regards the relievable amount for an accounting period, the company may claim under this subsection that— shall be treated as mentioned in subsection (7) below.
the whole of the relievable amount, or
where the relievable amount exceeds the relevant exchange profits, so much of the relievable amount as is equal to those profits,
Where a company has made a claim under subsection (3) or (4) above as regards the relievable amount for an accounting period, the company may claim under this subsection that— shall be treated as mentioned in subsection (7) below.
such part of the relievable amount as is not the subject of any such claim, or
where that part exceeds the relevant exchange profits, so much of that part as is equal to those profits,
Where a company claims under subsection (5) or (6) above as regards the whole or part of the relievable amount for an accounting period, the whole or part concerned shall be set off for the purposes of corporation tax against the exchange profits of preceding accounting periods falling wholly or partly within the permitted period; and (subject to any relief for an earlier loss) the exchange profits of any of those accounting periods shall then be treated as reduced by the whole or part concerned or by so much of it as cannot be set off under this subsection against the exchange profits of a later accounting period.
For the purposes of subsections (5) and (6) above “the relevant exchange profits” means the total of the following—
the exchange profits, as reduced by any reliefs for earlier losses and any reliefs falling within subsection (9) below, of all those accounting periods falling wholly within the permitted period, and
such part of the exchange profits, as so reduced, of any accounting period falling partly before the beginning of the permitted period as is proportionate to the part of the accounting period falling within the permitted period.
The reliefs falling within this subsection are—
any relief under section 338 of the Taxes Act 1988 (charges on income) in respect of payments made wholly and exclusively for the purposes of a trade;
where the company is an investment company for the purposes of Part IV of the Taxes Act 1988, any relief under that section in respect of payments made wholly and exclusively for the purposes of its business.
For the purposes of subsections (7) and (8) above—
the exchange profits of an accounting period are the annual profits or gains the company is treated as receiving in that period under section 130 above,
the permitted period is the period of three years immediately preceding the accounting period first mentioned in subsection (7) above, and
an earlier loss is a loss incurred, or treated as incurred, in an accounting period earlier than that first mentioned in subsection (7) above.
The amount of the reduction that may be made under subsection (7) above in the exchange profits of an accounting period falling partly before the beginning of the permitted period shall not exceed a part of those profits proportionate to the part of the accounting period falling within the permitted period.
If the whole or part of the relievable amount for an accounting period is not dealt with under a claim under this section—
the company shall be treated as incurring by virtue of section 129 above a loss of an amount equal to the whole or part (as the case may be),
the company shall be treated as incurring the loss in the next succeeding accounting period, and
in relation to that accounting period references to amount B shall be construed accordingly.
A company—
may not claim under more than one of subsections (3) and (4) above as regards the same part of a relievable amount, and
where it has claimed under subsection (5)(b) or (6) above as regards part of a relievable amount, may not later claim under subsection (3) or (4) above as regards any part of the relievable amount.
A claim under any of subsections (3) to (6) above must be made within the period of two years immediately following the accounting period to which the relievable amount relates or within such further period as the Board may allow.
This section applies where section 131(12) above treats a company as incurring a loss in an accounting period by virtue of section 129 above.
In this section references to amount C are to so much of amount B as the company is treated as incurring in the accounting period otherwise than by virtue of section 131(12).
Where section 131 above applies by virtue of section 131(1) and this section applies, then, as regards the accounting period—
if amount C is nil section 131(3) to (6) shall not apply;
if amount C exceeds nil the references to the relievable amount in section 131(3) to (7), (13) and (14) shall be construed as references to so much of that amount as equals amount C.
Where section 131 above applies by virtue of section 131(2) and this section applies, then, as regards the accounting period—
if amount C does not exceed amount A section 131(3) to (6) shall not apply;
if amount C exceeds amount A the references to the relievable amount in section 131(3) to (7), (13) and (14) shall be construed as references to so much of that amount as equals amount C minus amount A.
Section 131(4) above shall apply before section 393A(1) of the Taxes Act 1988 in relation to profits of the accounting period first mentioned in section 131(4) above.
Relief shall not be given under section 131(4) above against any ring fence profits of the company; and in this subsection “ring fence profits” has the same meaning as in Chapter V of Part XII of the Taxes Act 1988.
Where the company incurs a loss in a trade in the accounting period first mentioned in subsection (7) of section 131 above, that subsection shall apply after section 393A(1) of the Taxes Act 1988 in relation to exchange profits of a particular accounting period.
Relief shall not be given by virtue of section 131(7) above so as to interfere with—
any relief under section 338 of the Taxes Act 1988 (charges on income) in respect of payments made wholly and exclusively for the purposes of a trade, or
where the company is an investment company for the purposes of Part IV of the Taxes Act 1988, any relief under that section in respect of payments made wholly and exclusively for the purposes of its business.
The reference in subsection (3) above to exchange profits of an accounting period shall be construed in accordance with section 131(10) above.
In a case where— the loss shall be treated as not accruing.
an exchange loss would (apart from this section) accrue to a company for an accrual period,
the loss would accrue as regards an asset or liability falling within section 153(1)(a) or (2)(a) below,
the nominal currency of the asset or liability is such that the main benefit or one of the main benefits that might be expected to arise from the company’s holding the asset or owing the liability is the accrual of the loss, and
the Board direct that this subsection shall apply,
References in subsection (1) above to an exchange loss are to an exchange loss of a trade or an exchange loss of part of a trade or a non-trading exchange loss.
Subject to the following provisions of this section, subsection (2) below applies where— and any reference in this section to an exchange loss is to an exchange loss of a trade or an exchange loss of part of a trade or a non-trading exchange loss.
a qualifying company becomes entitled to a qualifying asset falling within section 153(1)(a) below or subject to a qualifying liability falling within section 153(2)(a) below,
the transaction as a result of which the company becomes entitled or subject to the asset or liability would not have been entered into at all if the parties to the transaction had been dealing at arm’s length, or the transaction’s terms would have been different if they had been so dealing,
as regards the asset or liability an exchange loss accrues to the company for an accrual period (or would so accrue apart from this section), and
the Board direct that subsection (2) below shall apply;
The exchange loss shall be treated as not accruing to the company for the accrual period.
Where subsection (2) above applies and the accrual period is not the last to occur as regards the asset or liability while it is held or owed by the company— and an appropriate exchange gain is an exchange gain of the trade concerned (if the exchange loss is an exchange loss of a trade) or an exchange gain of the part of the trade concerned (if the exchange loss is an exchange loss of part of a trade) or a non-trading exchange gain (if the exchange loss is a non-trading exchange loss).
an amount equal to the amount of the loss shall be set off against appropriate exchange gains accruing to the company as regards the asset or liability for subsequent accrual periods, and
any such gain shall then be treated as reduced by that amount or by so much of it as cannot be set off under this subsection against any such gain accruing for an earlier accrual period;
Subsection (5) below applies where the circumstances are such that, had the parties to the transaction been dealing at arm’s length, its terms would have been the same except that the amount of the debt would have been an amount (the adjusted amount) greater than nil but less than its actual amount.
In such a case— but paragraph (b) above shall only apply if the Board so direct.
subsection (2) above shall not apply, and
the exchange loss accruing to the company for the accrual period shall be treated as reduced to the amount it would have been if the amount of the debt had been the adjusted amount;
Where subsection (5)(b) above applies and the accrual period is not the last to occur as regards the asset or liability while it is held or owed by the company— and an appropriate exchange gain is an exchange gain of the trade concerned (if the exchange loss is an exchange loss of a trade) or an exchange gain of the part of the trade concerned (if the exchange loss is an exchange loss of part of a trade) or a non-trading exchange gain (if the exchange loss is a non-trading exchange loss).
an amount equal to the amount by which the loss is treated as reduced shall be set off against appropriate exchange gains accruing to the company as regards the asset or liability for subsequent accrual periods, and
any such gain shall then be treated as reduced by that amount or by so much of it as cannot be set off under this subsection against any such gain accruing for an earlier accrual period;
Subsection (2) above shall not apply in a case where—
the right constituting the asset mentioned in subsection (1) above arises under a loan made by the company,
the circumstances are such that, had the parties to the transaction been dealing at arm’s length, its terms would have been the same except that interest would have been charged on the loan or, as the case may be, charged at a higher rate, and
in computing for tax purposes the profits or losses of the company for the accounting period which constitutes the accrual period or in which the accrual period falls the whole of the loan has been treated under section 770 of the Taxes Act 1988 (undervalue or overvalue) as if interest had been charged on it or, as the case may be, charged at a higher rate.
Subsection (9) below applies where— and in subsection (9) below the reference to the adjusted amount is to an amount equal to the part of the loan that has been so treated.
paragraphs (a) and (b) of subsection (7) above apply, and
in computing for tax purposes the profits or losses of the company for the accounting period which constitutes the accrual period or in which the accrual period falls part of the loan has been treated under section 770 of the Taxes Act 1988 as if interest had been charged on it or, as the case may be, charged at a higher rate;
In such a case— but paragraph (b) above shall only apply if the Board so direct.
subsection (2) above shall not apply, and
the exchange loss accruing to the company for the accrual period shall be treated as reduced to the amount it would have been if the amount of the loan had been the adjusted amount;
Where subsection (9)(b) above applies and the accrual period is not the last to occur as regards the asset while it is held by the company— and an appropriate exchange gain is an exchange gain of the trade concerned (if the exchange loss is an exchange loss of a trade) or an exchange gain of the part of the trade concerned (if the exchange loss is an exchange loss of part of a trade) or a non-trading exchange gain (if the exchange loss is a non-trading exchange loss).
an amount equal to the amount by which the loss is treated as reduced shall be set off against appropriate exchange gains accruing to the company as regards the asset for subsequent accrual periods, and
any such gain shall then be treated as reduced by that amount or by so much of it as cannot be set off under this subsection against any such gain accruing for an earlier accrual period;
Subsections (2) to (10) above shall not apply where—
the transaction is entered into by the company mentioned in subsection (1) above (company A) and another company (company B),
the companies are members of the same group when the transaction is entered into and throughout the accounting period which constitutes the accrual period mentioned in subsection (1) above or in which the accrual period falls,
as a result of the transaction, not only does company A become entitled or subject to the asset or liability falling within section 153(1)(a) or (2)(a) below but company B also becomes subject or entitled to the corresponding liability or asset (as the case may be) falling within section 153(2)(a) or (1)(a) below,
as regards that liability or asset an appropriate exchange gain accrues to company B for an accrual period coterminous with that mentioned in subsection (1) above,
throughout the accrual period concerned company A holds or owes the asset or liability either for the purposes of one trade or for non-trading purposes,
throughout the accrual period concerned company B owes or holds the liability or asset either for the purposes of one trade or for non-trading purposes, and
amount X is the same as amount Y.
For the purposes of subsection (11) above—
an appropriate exchange gain is an exchange gain of a trade or a non-trading exchange gain found (in either case) in the currency in which the exchange loss mentioned in subsection (1) above is found;
amount X is the amount of the exchange loss mentioned in subsection (1) above;
amount Y is the amount of the exchange gain mentioned in subsection (11)(d) above, found without regard to section 139 below;
companies are members of the same group if by virtue of section 170 of the Taxation of Chargeable Gains Act 1992 they are members of the same group for the purposes of sections 171 to 181 of that Act.
Where the exchange loss mentioned in subsection (1) above represents the whole or part of an initial exchange loss accruing under section 127 above, this section shall have effect as if subsections (4) to (12) were omitted.
Regulations may make provision designed to supplement this section in its application to a case where the exchange loss mentioned in subsection (1) above represents the whole or part of an initial exchange loss accruing under section 127 above; and the regulations may in particular contain provision based on subsections (4) to (12) above but differing from those subsections to such extent as the Treasury think fit.
In applying subsections (1)(b), (4) and (7)(b) above all factors shall be taken into account including any interest or other sums that would have been payable, any currency that would have been involved, and the amount that any loan would have been.
Subsection (2) below applies where— and any reference in this section to an exchange loss is to an exchange loss of a trade or an exchange loss of part of a trade or a non-trading exchange loss.
a qualifying company enters into a currency contract,
the contract would not have been entered into at all if the parties to it had been dealing at arm’s length, or the contract’s terms would have been different if they had been so dealing,
as regards the contract an exchange loss accrues to the company for an accrual period (or would so accrue apart from this section), and
the Board direct that subsection (2) below shall apply;
The exchange loss shall be treated as not accruing to the company for the accrual period.
Where subsection (2) above applies and the accrual period is not the last to occur as regards the contract while it is held by the company— and an appropriate exchange gain is an exchange gain of the trade concerned (if the exchange loss is an exchange loss of a trade) or an exchange gain of the part of the trade concerned (if the exchange loss is an exchange loss of part of a trade) or a non-trading exchange gain (if the exchange loss is a non-trading exchange loss).
an amount equal to the amount of the loss shall be set off against appropriate exchange gains accruing to the company as regards the contract for subsequent accrual periods, and
any such gain shall then be treated as reduced by that amount or by so much of it as cannot be set off under this subsection against any such gain accruing for an earlier accrual period;
In applying subsection (1)(b) above all factors shall be taken into account including any currency that would have been involved and any amounts that would have been involved.
Subsection (2) below applies where—
an exchange gain of a trade, or of part of a trade, accruing to a company for an accrual period falls to be reduced by virtue of section 136(3), (6) or (10) or 137(3) above, and
the amount falling to be set off is expressed in a currency (the first currency) different from the currency in which the gain is expressed (the second currency).
For the purposes of section 136(3), (6) or (10) or 137(3) the amount falling to be set off shall be treated as the equivalent, expressed in the second currency, of the amount expressed in the first currency.
The translation required by subsection (2) above shall be made by reference to the London closing exchange rate for the two currencies concerned for the first day of the accounting period which constitutes the relevant accrual period or in which that accrual period falls; and the relevant accrual period is the accrual period mentioned in subsection (1)(a) above.
Subsection (2) above shall have effect subject to the application for succeeding accrual periods of this section as regards an amount falling to be set off.
References in subsections (1) and (2) above to the amount falling to be set off include references to so much of that amount as remains after any application of section 136(3), (6) or (10) or 137(3) for earlier accrual periods.
This section applies where (apart from a claim under this section as regards an accounting period) an unrealised exchange gain would accrue to a company— and the reference here to an exchange gain is to an exchange gain of a trade or an exchange gain of part of a trade or a non-trading exchange gain.
for an accrual period constituting or falling within the accounting period, and
as regards a long-term capital asset or a long-term capital liability;
This section does not apply unless an amount is available for relief under this section for the accounting period.
The company may claim that—
the gain, or part of it, shall be treated in accordance with section 140(3) below, and
an amount shall be treated in accordance with section 140(4) to (10) below as regards the asset or liability.
The claim must—
stipulate the amount of the gain or part to be treated as mentioned in subsection (3)(a) above;
stipulate the amount to be treated as mentioned in subsection (3)(b) above;
identify the asset or liability concerned.
The following rules apply to a claim—
only one claim may be made as regards an accounting period, but where this section applies in relation to two or more gains which would accrue to a company for an accrual period or accrual periods constituting or falling within the accounting period the claim may be made in relation to more than one of the gains;
the amount stipulated under subsection (4)(b) above as regards an asset or liability must be the same as, and must be expressed in the same currency as, the amount of the gain or part stipulated under subsection (4)(a) above as regards the asset or liability;
the amount (or total of the amounts) stipulated under subsection (4)(a) above as regards an accounting period must not exceed the amount available for relief under this section for the accounting period.
A claim may not be made or withdrawn as regards an accounting period if— but the preceding provisions of this subsection do not apply if the claim or withdrawal is made before the expiry of the period of two years beginning with the end of the accounting period.
the company has been assessed to corporation tax for the period, and
the assessment has become final and conclusive;
In a case where— a claim may not be made or withdrawn as regards that accounting period.
the period of six years beginning with the end of an accounting period expires, and
no assessment of the company to corporation tax for the accounting period has become final and conclusive,
In a case where— a claim may be made on or before such day as the Board allow.
subsection (6) or (7) above would otherwise prevent a claim being made in a particular case, and
the Board make a determination under this subsection,
This section applies where a claim is made under section 139 above as regards an asset or liability.
For the purposes of this section—
the first accrual period is the accrual period mentioned in section 139(1) above, and
the second accrual period is the accrual period next occurring as regards the asset or liability while it is held or owed by the company.
Any gain or part whose amount is stipulated under section 139(4)(a) above as regards the asset or liability shall be treated as not accruing as regards the asset or liability for the first accrual period.
If throughout the second accrual period the asset is held, or the liability is owed, by the company solely for the purposes of a trade or part of a trade—
an exchange gain of the trade or part for the accrual period shall be treated as accruing to the company as regards the asset or liability,
the amount of the gain shall be the amount stipulated under section 139(4)(b) above as regards the asset or liability, and
section 128(4) above shall apply.
If throughout the second accrual period the asset is held, or the liability is owed, by the company solely for purposes other than trading purposes—
a non-trading exchange gain for the accrual period shall be treated as accruing to the company as regards the asset or liability,
the amount of the gain shall be the amount stipulated under section 139(4)(b) above as regards the asset or liability, and
section 129(2) above shall apply.
Where as regards the second accrual period neither subsection (4) nor subsection (5) above applies—
the amount stipulated under section 139(4)(b) above as regards the asset or liability shall be apportioned for the period on a just and reasonable basis, and
subsections (7) and (8) below shall apply.
Where for the second accrual period part of an amount is attributed to a trade or part of a trade under subsection (6) above—
an exchange gain of the trade or part for the accrual period shall be treated as accruing to the company as regards the asset or liability,
the amount of the gain shall be the amount of the part so attributed, and
section 128(4) above shall apply.
Where for the second accrual period part of an amount is attributed to purposes other than trading purposes under subsection (6) above—
a non-trading exchange gain for the accrual period shall be treated as accruing to the company as regards the asset or liability,
the amount of the gain shall be the amount of the part so attributed, and
section 129(2) above shall apply.
In a case where— to that extent the gain shall be treated as a non-trading exchange gain (and not as a gain of the trade or part) and section 129(2) above shall apply.
an exchange gain of a trade or of part of a trade for the second accrual period is treated as accruing to a company by virtue of the preceding provisions of this section (or would be so treated apart from this subsection), and
in that period the asset or liability is to any extent held or owed by the company in exempt circumstances,
Any apportionment required by subsection (9) above shall be made on a just and reasonable basis.
Subsections (4) to (10) above shall have effect subject to any further application of section 139 above as regards the asset or liability.
For the purposes of this section a part of a trade is any part of a trade whose basic profits or losses for the relevant accounting period are by virtue of regulations under section 94 above to be computed and expressed in a particular currency for the purposes of corporation tax; and the relevant accounting period is the accounting period which constitutes the second accrual period or in which that accrual period falls.
An amount is available for relief under section 139 above for an accounting period if amount A is exceeded by amount B or (if amount C is lower than amount B) amount A is exceeded by amount C; and the amount available for relief for the period is the amount of the difference between amount A and amount B or (as the case may be) between amount A and amount C.
Amount A is one tenth of the amount falling within subsection (3) below.
The amount falling within this subsection is an amount equal to the amount of the company’s profits for the accounting period on which corporation tax would fall finally to be borne apart from— and section 238(4) of the Taxes Act 1988 (amount of profits on which corporation tax falls finally to be borne) shall apply for the purposes of this subsection.
a claim under section 139 above as regards the accounting period, and
section 402 of the Taxes Act 1988 (group relief);
Amount B is the amount found by deducting amount B(2) from amount B(1) where—
amount B(1) is the total amount of unrealised exchange gains which accrue or would (apart from a claim under section 139 above as regards the accounting period) accrue to the company, in an accrual period or accrual periods constituting or falling within the accounting period, as regards long-term capital assets or long-term capital liabilities or both;
amount B(2) is the total amount of unrealised exchange losses accruing to the company in such an accrual period or accrual periods as regards such assets or liabilities or both.
Amount C is the amount found by deducting amount C(2) from amount C(1) where—
amount C(1) is the total amount of exchange gains which accrue or would (apart from a claim under section 139 above as regards the accounting period) accrue to the company, in an accrual period or accrual periods falling within the accounting period, as regards relevant items;
amount C(2) is the total amount of exchange losses accruing to the company in such an accrual period or periods as regards relevant items.
In subsections (4) and (5) above the references to exchange gains and losses are to exchange gains and losses of a trade and exchange gains and losses of part of a trade and non-trading exchange gains and losses.
For the purposes of subsection (5) above relevant items are—
assets falling within section 153(1)(a) below;
liabilities falling within section 153(2)(a) below;
currency contracts.
Where apart from this subsection— the amount of the gain or loss shall be treated for the purposes of sections 139 to 141 above as the sterling equivalent of its amount expressed in the other currency.
a gain falling within section 139(1) above would be expressed in a currency other than sterling, or
a gain or loss falling within section 141(4) or (5) above would be expressed in a currency other than sterling,
For the purposes of subsection (1) above the sterling equivalent of an amount is—
the sterling equivalent calculated by reference to such rate of exchange as applies by virtue of section 93(6) above in the case of the basic profits or losses for the accounting period concerned of the trade of which the gain or loss is a gain or loss (or would be apart from section 139 above), or
the sterling equivalent calculated by reference to such rate of exchange as applies by virtue of section 94(11) above in the case of the basic profits or losses for the accounting period concerned of the part of the trade of which the gain or loss is a gain or loss (or would be apart from section 139 above).
Subsection (4) below applies where—
part of an exchange gain of a trade, or part of an exchange gain of part of a trade, is treated as not accruing to a company for an accrual period by virtue of section 140(3) above, and
the local currency of the trade or part for the accounting period which constitutes the accrual period or in which it falls is a currency other than sterling.
The amount the company is treated as receiving under section 128(4) above in respect of the accounting period and by virtue of the gain (as reduced) shall be taken into account after the basic profits or losses of the trade or part for the accounting period are found in sterling for the purposes of corporation tax.
In a case where— the amount of the gain shall be treated as the local currency equivalent of its amount expressed in sterling.
an exchange gain of a trade, or of part of a trade, for an accrual period is treated as accruing to a company under section 140 above, and
the local currency of the trade or part for the accounting period which constitutes the accrual period or in which it falls is a currency other than sterling,
The translation required by subsection (5) above shall be made by reference to the London closing exchange rate for the two currencies concerned—
for the last day of the accrual period mentioned in subsection (5) above, or
if that accrual period does not end with the end of a day, for the day on which that accrual period ends.
For the purposes of sections 139 and 141 above and this section an exchange gain or loss is unrealised if the accrual period concerned is one which ends solely by virtue of an accounting period of the company coming to an end.
In a case where— the company may not claim under section 139 above as regards so much of the unrealised exchange gain as is so attributable.
an unrealised exchange gain would accrue as mentioned in section 139(1) above,
the gain represents the whole or part of an initial exchange gain accruing under section 127 above, and
the whole or part of the unrealised exchange gain is attributable to any part by which the nominal amount of the debt has decreased,
In applying subsection (2)(c) above the gain shall be apportioned on a just and reasonable basis.
For the purposes of sections 139 and 141 above an asset or liability is a long-term capital asset or liability if the following conditions are fulfilled— and the time for settlement is the earliest time at which the creditor can require settlement if he exercises all available options and rights.
the asset or liability falls within section 153(1)(a) or (2)(a) below,
the debt under which it subsists is such that, under the terms as originally entered into, the time for settlement is not less than one year from the time when the debt was created, and
the asset or liability represents capital throughout the accounting period mentioned in section 139(1) above;
For the purposes of section 140 above an asset is held, or a liability is owed, in exempt circumstances at a given time if it is then held or owed—
for the purposes of long term insurance business;
for the purposes of mutual insurance business;
for the purposes of the occupation of commercial woodlands;
by a housing association approved at that time for the purposes of section 488 of the Taxes Act 1988;
by a self-build society approved at that time for the purposes of section 489 of that Act.
In subsection (5) above—
if two or more such persons were so acting and none of them was so appointed, the person who was so acting for the member in his capacity as a member of the syndicate, or
Regulations may— and any provision under paragraph (a) above may include provision that realised gains or losses are to be treated as wholly or partly unrealised.
make provision modifying the effect of sections 139 to 142 above and the preceding provisions of this section in a case where the debt under which a long-term capital asset or liability subsists is settled and replaced to any extent by another debt under which (or other debts under each of which) such an asset or liability subsists;
make provision modifying the effect of sections 139 to 142 above and the preceding provisions of this section in a case where a group of companies is involved;
provide that the amount falling within section 141(3) above shall be treated as reduced in accordance with prescribed rules;
In a case where— the company shall be treated for the purposes of this Chapter as if immediately before the end of that accounting period it ceased to be entitled to the asset or subject to the liability.
a qualifying company holds an asset consisting of a right to settlement under a qualifying debt or owes a liability consisting of a duty to settle under such a debt, and
the inspector is satisfied, as regards any accounting period of the company, that all of the debt outstanding immediately before the end of the period could at that time reasonably have been regarded as irrecoverable,
Subsection (3) below applies in a case where—
paragraph (a) of subsection (1) above applies, and
the inspector is satisfied, as regards any accounting period of the company, that part of the debt outstanding immediately before the end of the period could at that time reasonably have been regarded as irrecoverable.
The company shall be treated for the purposes of this Chapter as if—
immediately after the beginning of the accounting period next following the accounting period mentioned in subsection (2) above there were a decrease in the nominal amount of the debt outstanding, and
the decrease were of an amount equal to so much of the debt, expressed in its settlement currency, as was outstanding immediately before the end of the accounting period mentioned in subsection (2) above and in the opinion of the inspector could at that time reasonably have been regarded as irrecoverable.
Where there is an appeal, this section shall be construed as if—
“inspector is satisfied” (in each place) read “Commissioners concerned are satisfied”, and
“opinion of the inspector” read “opinion of the Commissioners concerned”.
Subsection (2) below applies where—
a company has been treated as mentioned in section 144(1) above as regards a debt,
at a time (the later time) falling after the end of the accounting period mentioned in section 144(1)(b) above all or part of the debt is actually outstanding, and
the inspector is satisfied that all or part of the amount actually outstanding at the later time could at that time reasonably have been regarded as recoverable.
The company shall be treated for the purposes of this Chapter as if—
immediately after the later time it had become entitled to an asset consisting of a right to settlement under the debt or (as the case may be) subject to a liability consisting of a duty to settle under the debt, and
the nominal amount of the debt outstanding, at the time the company became entitled or subject to the asset or liability, were an amount equal to so much of the debt, expressed in its settlement currency, as was actually outstanding at the later time and in the opinion of the inspector could at that time reasonably have been regarded as recoverable.
Subsections (4) and (5) below apply where—
a company has been treated as mentioned in section 144(3) above as regards a debt, or
a company has been treated as mentioned in subsection (2) above as regards a debt by virtue of the fact that in the opinion of the inspector part of the debt could, at the later time, reasonably have been regarded as recoverable.
In a case where— the company shall be treated for the purposes of this Chapter as if, immediately after the relevant time, there were an increase in the nominal amount of the debt outstanding and the increase were of an amount equal to the excess mentioned in paragraph (c) above.
at a time (the relevant time) falling after the end of the accounting period mentioned in section 144(2)(b) above or (as the case may be) falling after the later time all or part of the debt is actually outstanding,
the inspector is satisfied that all or part of the amount actually outstanding at the relevant time could at that time reasonably have been regarded as recoverable, and
the recoverable amount exceeds the amount which (taking into account section 144(3) above, subsection (2) above and any previous application of this subsection) is the nominal amount of the debt outstanding at the relevant time,
For the purposes of subsection (4) above the recoverable amount is an amount equal to so much of the debt, expressed in its settlement currency, as was actually outstanding at the relevant time and in the opinion of the inspector could at that time reasonably have been regarded as recoverable.
Where there is an appeal, this section shall be construed as if—
“inspector is satisfied” (in each place) read “Commissioners concerned are satisfied”, and
“opinion of the inspector” (in each place) read “opinion of the Commissioners concerned”.
This section applies where—
a qualifying company ceases to be entitled to rights and subject to duties under a currency contract, and
at the time it so ceases it has neither received nor made payment of any currency in pursuance of the contract.
If the company has a net contractual gain of a trade it shall be treated for the purposes of the Tax Acts as—
incurring in the trade a loss of an amount equal to that gain, and
incurring the loss in respect of the last relevant accounting period.
If the company has a net contractual loss of a trade it shall be treated for the purposes of the Tax Acts as—
receiving in respect of the trade an amount equal to that loss, and
receiving the amount in respect of the last relevant accounting period.
If the company has a net contractual non-trading gain—
it shall be treated as incurring by virtue of section 129 above a loss of an amount equal to the amount of that gain,
it shall be treated as incurring the loss in the last relevant accounting period, and
in relation to that accounting period references to amount B shall be construed accordingly.
If the company has a net contractual non-trading loss—
it shall be treated as receiving by virtue of section 129 above an amount equal to the amount of that loss,
it shall be treated as receiving the amount in the last relevant accounting period, and
in relation to that accounting period references to amount A shall be construed accordingly.
For the purposes of this section—
the termination time is the time mentioned in subsection (1)(b) above;
the last relevant accounting period is the company’s accounting period in which the termination time falls;
the relevant accounting periods are that accounting period and the company’s accounting periods preceding it.
This is how to find out whether the company has a net contractual gain or loss of a trade and (if it has) its amount— and in applying paragraphs (a) and (b) above ignore the effect of subsections (2) and (3) above.
take the aggregate of the amounts (if any) the company is treated as receiving under section 128(4) above in respect of the trade and the contract and the relevant accounting periods;
take the aggregate of the amounts (if any) of the losses the company is treated as incurring under section 128(8) above in the trade and in respect of the contract and the relevant accounting periods;
if the amount found under paragraph (a) above exceeds that found under paragraph (b) above the company has a net contractual gain of the trade of an amount equal to the excess;
if the amount found under paragraph (b) above exceeds that found under paragraph (a) above the company has a net contractual loss of the trade of an amount equal to the excess;
This is how to find out whether the company has a net contractual non-trading gain or loss and (if it has) its amount— and in applying paragraphs (a) and (b) above ignore the effect of subsections (4) and (5) above.
take the aggregate of the amounts (if any) the company is treated as receiving under section 129(2) above in respect of the contract in the relevant accounting periods;
take the aggregate of the amounts (if any) of the losses the company is treated as incurring under section 129(4) above in respect of the contract in the relevant accounting periods;
if the amount found under paragraph (a) above exceeds that found under paragraph (b) above the company has a net contractual non-trading gain of an amount equal to the excess;
if the amount found under paragraph (b) above exceeds that found under paragraph (a) above the company has a net contractual non-trading loss of an amount equal to the excess;
For the purposes of subsection (7) above—
an amount the company is treated as receiving under section 128(4) above in respect of part of the trade concerned shall be treated as received in respect of the trade;
a loss the company is treated as incurring under section 128(8) above in part of the trade shall be treated as incurred in the trade.
Where any amount or loss the company is treated as receiving or incurring as mentioned in subsection (7)(a) or (b) above would (apart from this subsection) be expressed in a currency other than the local currency of the trade for the last relevant accounting period, it shall be treated for the purposes of this section as being the local currency equivalent of the amount or loss expressed in that other currency.
For the purposes of subsection (10) above the local currency equivalent of an amount is the equivalent—
expressed in the local currency of the trade for the last relevant accounting period, and
calculated by reference to the London closing exchange rate for the day in which the termination time falls.
Subsection (13) below applies where the company has (apart from that subsection) a net contractual gain or loss of a trade and—
the trade concerned has ceased before the termination time, or
the company carries on exempt activities immediately before the termination time.
In such a case the company shall be treated for the purposes of this section as if—
it did not have the net contractual gain or loss of the trade, and
it had a net contractual non-trading gain or loss (as the case may be) equal to the amount which would have been the amount of the net contractual gain or loss of the trade apart from paragraph (a) above.
Where any amount found under subsection (13)(b) above would (apart from this subsection) be expressed in a currency other than sterling, it shall be treated for the purposes of this section as being the sterling equivalent of the amount expressed in that other currency; and any translation required by this subsection shall be made by reference to the London closing exchange rate for the currencies concerned for the day in which the termination time falls.
For the purposes of this section a company carries on exempt activities at a given time if—
the activities it then carries on are or include any of the activities mentioned in subsection (16) below,
it is a housing association approved at that time for the purposes of section 488 of the Taxes Act 1988, or
it is a self-build society approved at that time for the purposes of section 489 of that Act.
The activities referred to in subsection (15)(a) above are— and section 143(6) above applies for the purposes of this subsection.
the activity of long term insurance business;
the activity of mutual insurance business;
the activity of the occupation of commercial woodlands;
This section applies where—
a qualifying company enters into a currency contract (the first contract), and
the company closes out that contract by entering into another currency contract (the second contract) with rights and duties which are reciprocal to those under the first contract.
For the purposes of this Chapter the company shall be treated as ceasing, at the time it enters into the second contract, to be entitled to rights and subject to duties under the first contract without having received or made payment of any currency in pursuance of the first contract.
For the purposes of this Chapter the second contract shall be ignored (except in applying the preceding provisions of this section).
Regulations may provide that where prescribed conditions are fulfilled as regards an asset or liability relief from tax shall be afforded in respect of it; and subsections (2) to (4) below shall apply for the purposes of the regulations.
The prescribed conditions must be or include ones that are met where it can reasonably be said that—
a loss other than an exchange loss has accrued to a qualifying company as regards the asset or liability and no relief from tax is available under the Tax Acts in respect of the loss, and
exchange gains have accrued to the company as regards the asset or liability without being matched (or fully matched) by exchange losses accruing to the company as regards the asset or liability.
The relief shall take such form as is prescribed and shall be such that the amount relieved does not exceed the amount of the unmatched gains.
The regulations may provide that if the loss mentioned in subsection (2)(a) above is made good to any extent the relief afforded by the regulations shall be cancelled (to the extent prescribed) by an assessment to tax.
Regulations may provide that where prescribed conditions are fulfilled as regards an asset or liability a charge to tax shall be imposed in respect of it; and subsections (6) and (7) below shall apply for the purposes of the regulations.
The prescribed conditions must be or include ones that are met where it can reasonably be said that—
a gain other than an exchange gain has accrued to a qualifying company as regards the asset or liability and no charge to tax is imposed under the Tax Acts in respect of the gain, and
exchange losses have accrued to the company as regards the asset or liability without being matched (or fully matched) by exchange gains accruing to the company as regards the asset or liability.
The charge shall take such form as is prescribed and shall be such that the amount charged does not exceed the amount of the unmatched losses.
Regulations under this section may include provision that the relief—
is subject to a claim being made;
is not available in prescribed circumstances.
Where (apart from this subsection) an exchange gain or loss would be expressed in a currency other than sterling, the amount of the gain or loss shall be treated for the purposes of this section as the sterling equivalent of its amount expressed in the other currency.
The translation required by subsection (9) above shall be made by reference to the London closing exchange rate for the two currencies concerned—
for the last day of the accrual period for which the gain or loss accrues, or
if that accrual period does not end with the end of a day, for the day on which that accrual period ends.
In this section—
references to an exchange gain are to an exchange gain of a trade or an exchange gain of part of a trade or a non-trading exchange gain;
references to an exchange loss are to an exchange loss of a trade or an exchange loss of part of a trade or a non-trading exchange loss.
Subject to the following provisions of this section, the local currency for the purposes of sections 125 to 127 above is sterling.
Subsections (4) to (6) below apply where—
at any time in an accrual period an asset or contract was held, or a liability was owed, by a qualifying company for the purposes of a trade or trades carried on by it or of part or parts of a trade or trades carried on by it, and
the local currency of any such trade or part for the relevant accounting period is a currency other than sterling.
References in this section to the relevant accounting period are to the accounting period which constitutes the accrual period or in which the accrual period falls.
If throughout the accrual period the asset or contract was held, or the liability was owed, by the company solely for trading purposes and only one local currency is involved, sections 125 to 128 above shall be applied by reference to that currency.
If throughout the accrual period the asset or contract was held, or the liability was owed, by the company solely for trading purposes and more than one local currency is involved, sections 125 to 128 above shall be applied separately by reference to each local currency involved and any exchange gain or loss of a trade or part shall be ignored unless found in the currency which is the local currency of the trade or part for the relevant accounting period.
In any other case—
sections 125 to 128 above shall be applied by reference to sterling and sections 129 to 133 above shall be applied to any non-trading exchange gain or loss;
sections 125 to 128 above shall then be applied separately by reference to each local currency involved (other than sterling);
any exchange gain or loss of a trade or part shall be ignored unless found in the currency which is the local currency of the trade or part for the relevant accounting period (whether sterling or otherwise).
For the purposes of this section a part of a trade is any part of a trade whose basic profits or losses for the relevant accounting period are by virtue of regulations under section 94 above to be computed and expressed in a particular currency for the purposes of corporation tax.
This section has effect to determine the exchange rate to be used in finding for the purposes of this Chapter the local currency equivalent at a translation time of—
the basic valuation of an asset or liability,
the nominal amount of a debt outstanding, or
an amount of currency.
References in this section to the two currencies are to—
the local currency and the nominal currency of the asset or liability concerned (where this section applies by virtue of subsection (1)(a) or (1)(b) above), or
the local currency and the currency mentioned in subsection (1)(c) above (where this section applies by virtue of subsection (1)(c) above).
References in this section to an arm’s length rate are to such exchange rate for the two currencies as might reasonably be expected to be agreed between persons dealing at arm’s length.
Subsections (5) to (7) below apply where the translation time is a translation time solely by virtue of an accounting period of the company coming to an end.
In a case where— that is the exchange rate to be used as regards the asset, liability or contract.
an exchange rate for the two currencies is used (as regards the asset, liability or currency contract concerned) in the accounts of the company for the last day of the accounting period, and
the rate is an arm’s length rate,
In a case where— the exchange rate mentioned in paragraph (d) above is the exchange rate to be used as regards the contract.
the provision for whose purposes the local currency equivalent falls to be found is section 126 above,
an exchange rate for the two currencies is not used (as regards the currency contract concerned) in the accounts of the company for the last day of the accounting period,
the fact that such an exchange rate is not so used conforms with normal accountancy practice, and
the exchange rate for the two currencies that is implied by the currency contract concerned is an arm’s length rate,
In a case where neither subsection (5) nor subsection (6) above applies, the London closing exchange rate for the two currencies for the last day of the accounting period is the exchange rate to be used.
Subsections (9) to (14) below apply where the translation time is a translation time otherwise than solely by virtue of an accounting period of the company coming to an end.
In a case where— that is the exchange rate to be used as regards the asset, liability or contract.
an exchange rate for the two currencies is used (as regards the asset, liability or currency contract concerned) in the accounts of the company at the translation time,
the rate represents the average of arm’s length rates for all the days falling within a period, and
the arm’s length rate for any given day (other than the first) falling within the period is not significantly different from the arm’s length rate for the day preceding the given day,
In a case where— that is the exchange rate to be used as regards the asset, liability or contract.
subsection (9) above does not apply,
an exchange rate for the two currencies is used (as regards the asset, liability or currency contract concerned) in the accounts of the company at the translation time, and
the rate is an arm’s length rate,
In a case where— the exchange rate mentioned in paragraph (d) above is the exchange rate to be used as regards the contract.
the provision for whose purposes the local currency equivalent falls to be found is section 126 above,
an exchange rate for the two currencies is not used (as regards the currency contract concerned) in the accounts of the company at the translation time,
the fact that such an exchange rate is not so used conforms with normal accountancy practice, and
the exchange rate for the two currencies that is implied by the currency contract concerned is an arm’s length rate,
In a case where— the rate which represents the average of the London closing exchange rates for the currencies for all the days falling within the relevant period is the exchange rate to be used.
none of subsections (9) to (11) above applies,
it is the company’s normal practice, when using an exchange rate in its accounts, to use a rate which represents an average of exchange rates obtaining for a period, and
the London closing exchange rate for the two currencies for any given day (other than the first) falling within the relevant period is not significantly different from the London closing exchange rate for the two currencies for the day preceding the given day,
In a case where none of subsections (9) to (12) above applies, the London closing exchange rate for the day in which the translation time falls is the exchange rate to be used.
References in subsection (12) above to the relevant period are to the period which— and the relevant accounting period is the accounting period in which the translation time falls.
begins when the relevant accounting period begins, and
ends at the end of the day in which the translation time falls;
Subsection (2) below has effect to determine the exchange rate to be used in finding for the purposes of this Chapter the local currency equivalent, at a time immediately after the nominal amount of a debt outstanding increases or decreases, of any amount.
Subsections (9) to (14) of section 150 above (ignoring subsection (11)) shall apply for that purpose, but in so applying them—
references to the translation time shall be construed as references to the time mentioned in subsection (1) above;
references to the two currencies shall be construed as references to the local currency and the settlement currency of the debt.
Subject to the following provisions of this section, any company is a qualifying company.
A company established for charitable purposes only is not a qualifying company.
Where a unit trust scheme is an authorised unit trust as respects an accounting period the trustees (who are deemed to be a company for certain purposes by section 468(1) of the Taxes Act 1988) are not a qualifying company as regards that period.
A company which is approved for the purposes of section 842 of the Taxes Act 1988 (investment trusts) for an accounting period is not a qualifying company as regards that period.
In this section—
a limited partnership formed under the law of Scotland which is a successor member, or
As regards a qualifying company, each of the following is a qualifying asset— but paragraph (a) above shall have effect subject to subsections (3) and (4) below.
a right to settlement under a qualifying debt (whether or not the debt is a debt on a security);
a unit of currency;
a share held in qualifying circumstances;
As regards a qualifying company, each of the following is a qualifying liability— but paragraphs (a) to (d) above shall have effect subject to subsections (5) to (9) below.
a duty to settle under a qualifying debt (whether or not the debt is a debt on a security);
a liability that takes the form of a provision made by the company in respect of a duty to which it may become subject and which (if it were to become subject to it) would be a duty to settle under a qualifying debt;
a duty to transfer a right to settlement under a qualifying debt on a security, where the duty subsists under a contract and the company is not entitled to the right;
a duty to transfer a share or shares, where the duty subsists under a contract and the company is not entitled to the share or shares;
A right to settlement under a qualifying debt is not a qualifying asset if it is a right under a currency contract.
A right to settlement under a qualifying debt is not a qualifying asset if the debt is a debt on a security which under the terms of issue can be converted into or exchanged for a share or shares; but the preceding provisions of this subsection do not apply if the security is a deep gain security or the right is held in qualifying circumstances.
A duty to settle under a qualifying debt is not a qualifying liability if it is a duty under a currency contract.
A duty to settle under a qualifying debt is not a qualifying liability if the debt is a debt on a security which under the terms of issue can be converted into or exchanged for a share or shares; but the preceding provisions of this subsection do not apply if the security is a deep gain security.
A liability falling within subsection (2)(b) above is not a qualifying liability unless—
the duty to settle would (if the company were to become subject to it) be owed for the purposes of a trade, and
the provision falls to be taken into account (apart from this Chapter) in computing the profits or losses of the trade for corporation tax purposes.
A duty falling within subsection (2)(c) above is not a qualifying liability unless the right would be a qualifying asset if the company were entitled to it.
A duty falling within subsection (2)(d) above is not a qualifying liability unless the share (or each of the shares) would be a qualifying asset if the company were entitled to it.
For the purposes of this section each of the following is a qualifying debt— and for the purposes of this subsection an ecu shall be regarded as money.
a debt falling to be settled by the payment of money;
a debt falling to be settled by the transfer of a right to settlement under another debt, itself falling to be settled by the payment of money;
For the purposes of subsections (1)(c) and (4) above qualifying circumstances, in relation to an asset consisting of a share or a right to settlement, are circumstances where the qualifying company carries on a trade and— and the reference here to the local currency is to the local currency of the trade for the accounting period.
if the company were to transfer the asset, the transfer would fall to be taken into account (apart from this Chapter) in computing the profits or losses of the trade for corporation tax purposes, and
if the asset were held by the company at the end of an accounting period, the valuation of the asset to be shown in the company’s accounts for that time would fall to be found by taking the local currency equivalent at that time of the valuation put on the asset by the company (whether at that time or earlier) expressed in the nominal currency of the asset;
Interest accrued in respect of a debt shall not be treated as part of the debt.
Subject to the following provisions of this section, a company becomes entitled to an asset when it becomes unconditionally entitled to it.
In determining whether or not a company is unconditionally entitled to an asset, any transfer by way of security of the asset or of any interest or right in or over the asset shall be ignored.
Where a company agrees to acquire an asset by transfer it becomes entitled to it when the contract is made and not on a later transfer made pursuant to the contract; but the preceding provisions of this subsection do not apply where the agreement is by way of a currency contract.
Where a company agrees to dispose of an asset by transfer it ceases to be entitled to it when the contract is made and not on a later transfer made pursuant to the contract.
If a contract is conditional (whether on the exercise of an option or otherwise) for the purposes of subsections (3) and (4) above it is made when the condition is satisfied.
Where a company ceases to be entitled to an asset and at a later time becomes entitled to the same asset, with effect from the later time the asset shall be treated as if it were a different asset.
In a case where— the rights shall be treated as different assets and not part of the same asset.
at different times a company becomes entitled to rights to settlement under debts on securities, and
the rights are of the same kind,
Whether a transaction involves a company becoming entitled to— shall be determined according to the facts of the case concerned.
one asset consisting of a right to settlement under a debt on a security, or
a number of such assets,
For the purpose of deciding whether rights to settlement under debts on securities of a particular kind are held by a company, rights of that kind acquired earlier shall be treated as disposed of before rights of that kind acquired later; and references here to acquisition and disposal are references to becoming entitled and ceasing to be entitled.
For the purpose of deciding whether shares of a particular kind are held by a company, shares of that kind acquired earlier shall be treated as disposed of before shares of that kind acquired later; and references here to acquisition and disposal are references to becoming entitled and ceasing to be entitled.
In a case where— the rule used when the accounts are prepared (and not the rule in the subsection) shall be used for the purpose.
a rule is used for the purpose mentioned in subsection (9) or (10) above when the company’s accounts are prepared,
the rule differs from that contained in the subsection, and
the accounts are prepared in accordance with normal accountancy practice,
In a case where— the company shall be taken to have become entitled to the asset at the earlier time and not at the later time.
a company would (apart from this subsection) become entitled to an asset at a particular time (the later time) by virtue of the preceding provisions of this section,
the asset falls within section 153(1)(a) above,
the time at which the company, in drawing up its accounts, regards itself as becoming entitled to the asset is a time (the earlier time) earlier than the later time, and
the accounts are drawn up in accordance with normal accountancy practice,
Where subsection (12) above applies, as regards any time beginning with the earlier time and ending immediately before the later time the nominal amount of the debt shall be taken to be—
such amount as the company treats as the nominal amount in its accounts, or
such amount as it would so treat in accordance with normal accountancy practice (if that amount is different from the amount found under paragraph (a) above).
A company holds an asset at a particular time if it is entitled to it at that time.
Subject to the following provisions of this section, a company becomes subject to a liability falling within section 153(2)(a) above when it becomes unconditionally subject to it.
Where a company agrees to acquire a liability falling within section 153(2)(a) above by transfer it becomes subject to it when the contract is made and not on a later transfer made pursuant to the contract.
Where a company agrees to dispose of a liability falling within section 153(2)(a) above by transfer it ceases to be subject to it when the contract is made and not on a later transfer made pursuant to the contract.
If a contract is conditional (whether on the exercise of an option or otherwise) for the purposes of subsections (2) and (3) above it is made when the condition is satisfied.
Where a company ceases to be subject to a liability falling within section 153(2)(a) above and at a later time becomes subject to the same liability, with effect from the later time the liability shall be treated as if it were a different liability.
A company becomes subject to a liability falling within section 153(2)(b) above at the time with effect from which it makes the provision.
A company ceases to be subject to a liability falling within section 153(2)(b) above at the time with effect from which it deletes the provision or (if different) the time with effect from which it would delete the provision under normal accountancy practice.
Where a company makes a provision falling within section 153(2)(b) above and later changes the amount, the company shall be treated as— and so on for further changes.
deleting (with effect from the time when the change becomes effective) the provision representing the amount before the change, and
making (with effect from that time) a new provision representing the amount as changed;
A company ceases to be subject to a liability falling within section 153(2)(c) above when it becomes entitled to the right concerned, unless it ceases to be subject to the liability earlier apart from this subsection.
A company ceases to be subject to a liability falling within section 153(2)(d) above when it becomes entitled to the share or shares, unless it ceases to be subject to the liability earlier apart from this subsection.
In a case where— the company shall be taken to have become subject to the liability at the earlier time and not at the later time.
a company would (apart from this subsection) become subject to a liability at a particular time (the later time) by virtue of the preceding provisions of this section,
the liability falls within section 153(2)(a) above,
the time at which the company, in drawing up its accounts, regards itself as becoming subject to the liability is a time (the earlier time) earlier than the later time, and
the accounts are drawn up in accordance with normal accountancy practice,
Where subsection (11) above applies, as regards any time beginning with the earlier time and ending immediately before the later time the nominal amount of the debt shall be taken to be—
such amount as the company treats as the nominal amount in its accounts, or
such amount as it would so treat in accordance with normal accountancy practice (if that amount is different from the amount found under paragraph (a) above).
A company owes a liability at a particular time if it is subject to it at that time.
Each of the following questions shall be determined according to the facts of the case concerned—
whether a transaction (or series of transactions) involves the creation of one asset consisting of a right to settlement under a debt or a number of assets consisting of a number of such rights;
whether a transaction (or series of transactions) involves the creation of one liability consisting of a duty to settle under a debt or a number of liabilities consisting of a number of such duties;
whether a transaction (or series of transactions) involves the creation of both an asset (or assets) held and a liability (or liabilities) owed by the same company.
Subsection (3) below applies where—
a company, in drawing up its accounts, regards itself as becoming entitled or subject to an asset or liability at a particular time,
the company, in drawing up its accounts, regards itself as ceasing to be entitled or subject to the asset or liability at a later time,
at the time mentioned in paragraph (a) above it could reasonably be expected that the company would become entitled or subject to such an asset or liability,
the asset or liability does not in fact come into existence before the later time but (if it did) it would fall within section 153(1)(a) or (2)(a) above, and
the accounts are drawn up in accordance with normal accountancy practice.
The company shall be taken to—
become entitled or subject to such an asset or liability at the time it regards itself as becoming so entitled or subject, and
cease to be entitled or subject to such an asset or liability at the time it regards itself as ceasing to be so entitled or subject.
Where subsection (3) above applies, as regards any time beginning with the time mentioned in subsection (3)(a) and ending with the time mentioned in subsection (3)(b) the nominal amount of the debt shall be taken to be—
such amount as the company treats as the nominal amount in its accounts, or
such amount as it would so treat in accordance with normal accountancy practice (if that amount is different from the amount found under paragraph (a) above).
A company becomes entitled to rights and subject to duties under a currency contract when it enters into the contract.
A company holds a currency contract at a particular time if it is then entitled to rights and subject to duties under the contract; and it is immaterial when the rights and duties fall to be exercised and performed.
Where a qualifying company holds a qualifying asset the following are translation times as regards the asset—
the time immediately after the company becomes entitled to the asset;
the time immediately before the company ceases to be entitled to the asset;
any time which is a time when an accounting period of the company ends and which falls after the time mentioned in paragraph (a) above and before the time mentioned in paragraph (b) above.
Where a qualifying company owes a qualifying liability the following are translation times as regards the liability—
the time immediately after the company becomes subject to the liability;
the time immediately before the company ceases to be subject to the liability;
any time which is a time when an accounting period of the company ends and which falls after the time mentioned in paragraph (a) above and before the time mentioned in paragraph (b) above.
Where a qualifying company enters into a currency contract the following are translation times as regards the contract—
the time immediately after the company becomes entitled to rights and subject to duties under the contract;
the time immediately before the company ceases to be entitled to those rights and subject to those duties;
any time which is a time when an accounting period of the company ends and which falls after the time mentioned in paragraph (a) above and before the time mentioned in paragraph (b) above.
As regards a qualifying asset, a qualifying liability or a currency contract an accrual period is a period which—
begins with a time which is a translation time (other than the last to fall) as regards the asset, liability or contract, and
ends with the time which is the next translation time to fall as regards the asset, liability or contract.
Subject to the following provisions of this section, the basic valuation of an asset or liability is—
such valuation as the company puts on it with regard to the time immediately after the company becomes entitled or subject to it, or
such valuation as the company would put on it with regard to that time under normal accountancy practice, if that valuation is different from that found under paragraph (a) above.
Where (apart from this subsection) the valuation under subsection (1) above would be in a currency (the actual currency) other than the nominal currency, it shall be taken to be the equivalent, expressed in terms of the nominal currency, of the valuation in the actual currency; and the translation required by this subsection shall be made by reference to the London closing exchange rate for the two currencies concerned for the day in which the time mentioned in subsection (1) above falls.
The basic valuation of a liability falling within section 153(2)(c) or (d) above is the consideration for the company becoming subject to the liability; and any consideration or part that is not pecuniary shall be taken to be equal to its open market value—
found at the time when the company becomes subject to the liability, and
if part of the consideration is pecuniary, expressed in the same currency as that part.
Where (apart from this subsection) the valuation under subsection (3) above would be in a currency (the actual currency) other than the nominal currency, it shall be taken to be the equivalent, expressed in terms of the nominal currency, of the valuation in the actual currency; and the translation required by this subsection shall be made by reference to the London closing exchange rate for the two currencies concerned for the day on which the company becomes subject to the liability.
Subsections (6) to (9) below apply where—
the company becomes entitled to a right to settlement under a qualifying debt on a security, and
the circumstances are such that section 713(2)(b) or (3)(b) of the Taxes Act 1988 applies (transferee treated as entitled under accrued income scheme to relief or a sum found in sterling).
In such a case the basic valuation of the right shall be found by taking the consideration for the company becoming entitled to the right and— and any apportionment of consideration or of the amount found under section 713(2)(b) or (3)(b) shall be made on a just and reasonable basis.
subtracting such of the amount found under section 713(2)(b) as is attributable to the right, or
adding such of the amount found under section 713(3)(b) as is attributable to the right;
The following rules apply for the purposes of subsection (6) above—
any consideration or part that is pecuniary shall be expressed in sterling (if not otherwise so expressed);
any consideration or part that is not pecuniary shall be taken to be equal to its open market value, found at the time when the company becomes entitled to the right and expressed in sterling.
Where the nominal currency of the right mentioned in subsection (5) above is not sterling, the valuation found in sterling under subsection (6) above shall be taken to be its equivalent expressed in terms of the nominal currency.
Any translation required by subsection (7) or (8) above shall be made by reference to the London closing exchange rate for the currencies concerned for the day on which the company becomes entitled to the right.
Subsections (11) and (12) below apply where—
section 127 above applies as regards an asset or liability for an accrual period (the earlier period), and
section 125 or 127 above applies as regards the asset or liability for the next accrual period (the later period).
As regards the later period the basic valuation of the asset or liability shall be taken to be—
the nominal amount of the debt outstanding immediately before the beginning of the later period, or
if section 127(7) above also applies as regards the earlier period, the amount found under section 127(10) for that period.
As regards an accrual period which falls after the later period the basic valuation of the asset or liability shall be the amount found under subsection (11) above, subject to any subsequent application of that subsection.
As regards an asset mentioned in section 153(1)(a) above, or a liability mentioned in section 153(2)(a) or (b) or (c) above, the nominal currency is the settlement currency of the debt mentioned in the paragraph concerned.
As regards an asset mentioned in section 153(1)(b) above, the nominal currency is the currency concerned.
As regards an asset mentioned in section 153(1)(c) above, the nominal currency is the currency in which the share is denominated.
As regards a liability mentioned in section 153(2)(d) above, the nominal currency is the currency in which the share is (or shares are) denominated.
Subject to the following provisions of this section, the settlement currency of a debt is the currency in which ultimate settlement of the debt falls to be made.
In a case where— the settlement currency of the debt is the other currency.
ultimate settlement of a debt falls to be made in a particular currency, but
the amount of the currency falls to be determined by reference to the value at any time of an asset consisting of or denominated in another currency,
As regards a debt mentioned in section 153(2)(b) above, and as regards a case where section 156(3) above applies, in subsections (1) and (2) above “falls” (in each place) shall be read as “would fall”.
Where the settlement currency of a debt cannot be determined under subsections (1) to (3) above, the settlement currency of the debt is the currency that can reasonably be regarded as the most appropriate— and the material time is the time immediately after the company becomes entitled to the asset mentioned in section 153(1)(a) above or subject to the liability mentioned in section 153(2)(a) or (b) or (c) above.
deeming the state of affairs at settlement to be the same as the state of affairs at the material time, and
having regard to subsections (1) to (3) above;
For the purposes of this section the ecu shall be regarded as a currency.
The nominal amount of a debt outstanding at any time is the amount of the debt outstanding at that time, expressed in terms of the settlement currency of the debt.
In a case where— the amount of the payment or repayment shall be taken to be its equivalent expressed in terms of the settlement currency of the debt.
a payment or repayment is made at any time in a currency other than the settlement currency of a debt, and
it falls to be decided whether there is in consequence an increase or decrease in the nominal amount of the debt outstanding,
Any translation required by this section shall be made by reference to the London closing exchange rate for the currencies concerned for the day in which the time concerned falls.
Subject to subsection (2) below, the local currency of a trade for an accounting period is sterling.
Where by virtue of regulations under section 93 above the basic profits or losses of a trade for an accounting period are to be computed and expressed in a currency other than sterling for the purposes of corporation tax, that other currency is the local currency of the trade for the period.
Where by virtue of regulations under section 94 above the basic profits or losses of part of a trade for an accounting period are to be computed and expressed in a particular currency for the purposes of corporation tax, that currency is the local currency of the part for the period.
For the purposes of this section the ecu shall be regarded as a currency other than sterling; and references in this Chapter to a currency other than sterling shall be construed accordingly.
References to— shall be construed in accordance with sections 125 to 129 above and Schedule 15 to this Act.
initial exchange gains and losses,
exchange gains and losses of a trade or of part of a trade,
non-trading exchange gains and losses, and
the accrual of gains and losses mentioned in paragraphs (a) to (c) above,
References to a currency contract shall be construed in accordance with section 126(1) above.
References to a qualifying debt shall be construed in accordance with section 153(10) above.
References to a company’s commencement day shall be construed in accordance with section 165(7) below.
The local currency equivalent of a valuation of an asset or liability, or of an amount, is that valuation or amount expressed in terms of the local currency (a process sometimes known as translation).
References to the basic profits or losses of a trade for an accounting period shall be construed in accordance with section 93(2) above.
References to the basic profits or losses of part of a trade for an accounting period shall be construed in accordance with section 94(4) above.
References to a share are to a share in a company (whether or not the qualifying company).
Shares are of the same kind if they are treated as being of the same kind by the practice of a recognised stock exchange or would be so treated if dealt with on such a stock exchange.
Rights to settlement under debts on securities are of the same kind if the securities are treated as being of the same kind by the practice of a recognised stock exchange or would be so treated if dealt with on such a stock exchange.
“Security”, in the expression “debt on a security”, has the meaning given by section 132 of the Taxation of Chargeable Gains Act 1992.
References to deep gain securities shall be construed in accordance with Schedule 11 to the Finance Act 1989.
References to the ecu are to the European currency unit as defined for the time being in Council Regulation No. 3180/78/EEC or in any Community instrument replacing it.
“Prescribed” means prescribed by regulations made under this Chapter.
A reference to this Chapter includes a reference to regulations made under it and a reference to a provision of this Chapter includes a reference to regulations made under the provision, unless otherwise required by the context or regulations.
Sections 152 to 163 above, and the preceding provisions of this section, apply for the purposes of this Chapter.
This Chapter applies where—
a qualifying asset is one to which the company becomes entitled on or after the company’s commencement day;
a qualifying liability is one to which the company becomes subject on or after that day;
the rights and duties under a currency contract are ones to which the company becomes entitled and subject on or after that day.
Where a qualifying asset or liability is held or owed by a qualifying company both immediately before and at the beginning of its commencement day, for the purposes of this Chapter the company shall be treated as becoming entitled or subject to the asset or liability at the beginning of its commencement day.
Where both immediately before and at the beginning of its commencement day a qualifying company is entitled to rights and subject to duties under a currency contract, for the purposes of this Chapter the company shall be treated as becoming entitled and subject to them at the beginning of its commencement day.
Regulations may provide that where— subsection (2) above shall not apply and for the purposes of this Chapter the company shall be treated as becoming entitled or subject to the asset or liability at such time (falling after its commencement day) as is found in accordance with prescribed rules.
a qualifying asset or liability is held or owed by a qualifying company both immediately before and at the beginning of its commencement day, and
the asset or liability is of a prescribed description,
Regulations may provide that any rule made under subsection (4) above shall not apply, and that subsection (2) above shall accordingly apply, in a case where the company so elects in accordance with prescribed rules.
Schedule 16 to this Act (which contains transitional provisions) shall have effect.
For the purposes of this section—
a company’s commencement day is the first day of its first accounting period to begin after the day preceding the appointed day;
the appointed day is such day as may be appointed by order.
Subsections (1) to (6) above do not apply for the purposes of construing Schedule 17 to this Act (which contains its own commencement provisions).
This section applies where—
a company changes the date on which any accounting period is to begin,
if the change had not been made an exchange gain or gains not accruing to the company would have accrued or an exchange loss or losses accruing to the company would not have accrued or an exchange gain or gains accruing would have been bigger or an exchange loss or losses accruing would have been smaller, and
the change mentioned in paragraph (a) above was made for the purpose, or for purposes which include the purpose, of securing the non-accrual or reduction of the gain or gains or the accrual or increase of the loss or losses.
In such a case the inspector or on appeal the Commissioners concerned—
may in arriving at the exchange gains and losses accruing to the company assume that there had been no such change as is mentioned in subsection (1)(a) above, and
may accordingly make, with regard to the accounting period mentioned in subsection (1)(a) above, such adjustment to the company’s corporation tax liability as is just and reasonable.
For the purposes of this section—
an exchange gain is an exchange gain of a trade or an exchange gain of part of a trade or a non-trading exchange gain;
an exchange loss is an exchange loss of a trade or an exchange loss of part of a trade or a non-trading exchange loss.
Any power to make an order or regulations under this Chapter shall be exercisable by the Treasury.
Any power to make an order under this Chapter shall be exercisable by statutory instrument.
Any power to make regulations under this Chapter shall be exercisable by statutory instrument subject to annulment in pursuance of a resolution of the House of Commons.
Any power to make regulations under this Chapter—
may be exercised as regards prescribed cases or descriptions of case;
may be exercised differently in relation to different cases or descriptions of case.
Regulations under this Chapter may make provision in such way as the Treasury think fit, and in particular may amend or modify the effect of any enactment (whether or not contained in this Chapter).
Regulations under this Chapter may include such supplementary, incidental, consequential or transitional provisions as appear to the Treasury to be necessary or expedient.
No specific provision of this Chapter about regulations shall prejudice the generality of subsections (4) to (6) above.
Subject to the following provisions of this section, this Chapter shall apply in relation to insurance companies as it applies in relation to other qualifying companies.
Regulations may make provision about the treatment for corporation tax purposes of exchange differences arising as regards assets and liabilities held or owed by insurance companies.
Any such provision may be made—
about exchange differences arising as regards assets or liabilities (or both) generally or about a proportion of such differences;
about exchange differences arising as regards prescribed descriptions of assets or liabilities (or both) or about a proportion of such differences;
about exchange differences arising as regards individual assets or liabilities.
Any such provision may be made about assets or liabilities that are qualifying assets or liabilities, or about those that are not, or about both.
Regulations under this section may—
contain exceptions (whether by reference to categories of insurance business or otherwise);
contain provision about the circumstances in which a charge or relief is to arise, its amount, and other matters relating to it;
provide for consequential adjustments in a company’s corporation tax liability;
exclude or modify the effect of any of the provisions of this Chapter.
References in this section to exchange differences are to gains and losses attributable to fluctuations in currency exchange rates.
For the purposes of this section an insurance company is a company to which Part II of the Insurance Companies Act 1982 applies.
Schedule 18 to this Act (which contains amendments) shall have effect.
Income tax for any year of assessment on the profits arising from a member’s underwriting business shall be computed on the profits of that year of assessment.
As respects the profits arising to a member from his underwriting business for any year of assessment— but nothing in this subsection shall affect the manner in which the amount of any profits arising from assets forming part of an ancillary trust fund is to be computed.
the aggregate of those profits shall be chargeable to tax under Chapter 2 of Part 2 of the Income Tax (Trading and Other Income) Act 2005 as the profits of a trade carried on in the United Kingdom; and
accordingly, no part of those profits shall be treated as relevant foreign income, or be charged to tax under any other Part of that Act or any Part of the Income Tax (Earnings and Pensions) Act 2003;
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shall not be given under subsection (2) of that section; but
may, if the member so claims and he was a member in the preceding year of assessment, be given against his income for that preceding year, so far as it cannot be given against the income for the year in which the loss was sustained and can be given after any relief for a loss sustained in that preceding year.
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Subsection (2) above does not apply in relation to any profits arising before 6th April 1993 from assets forming part of an ancillary trust fund.
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Subject to the provisions of this Chapter, for the purposes of section 171 above and all other purposes of the Income Tax Acts the profits or losses in any year of assessment of a member’s underwriting business shall be taken to be—
in the case of profits or losses arising directly from his membership of one or more syndicates, those of any previous year or years which are declared in the corresponding underwriting year;
in the case of profits or losses arising from assets forming part of a premium trust fund, those allocated under the rules or practice of Lloyd’s to any previous year or years the profits or losses of which are declared in the corresponding underwriting year; and
in the case of other profits or losses, those derived from payments received or made in the corresponding underwriting year.
Subsection (1)(c) above does not apply in relation to payments received or made before 6th April 1993.
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Schedule 19 to this Act (assessment and collection of tax) shall have effect.
Regulations under this paragraph may make provision with respect to any year or years of assessment; and the year (or any of the years) may be the year next but one preceding the year in which the regulations are made or any year following that earlier year.
Subsection (2) above applies in relation to regulations made after the passing of this Act.
For the purposes of the Income Tax Acts and the Gains Tax Acts—
a member shall be treated as absolutely entitled as against the trustees to the assets forming part of a premium trust fund of his; and
where a deposit required by a regulatory authority in a country or territory outside the United Kingdom is paid out of such a fund, the money so paid shall be treated as still forming part of that fund.
Where an asset forms part of a premium trust fund at the beginning of any underwriting year, for the purposes of the Income Tax Acts—
the trustees of the fund shall be treated as acquiring it on that day, and
they shall be treated as paying in respect of the acquisition an amount equal to the value of the asset at the time of the acquisition.
Where an asset forms part of a premium trust fund at the end of any underwriting year, for the purposes of the Income Tax Acts—
the trustees of the fund shall be treated as disposing of it on that day, and
they shall be treated as obtaining in respect of the disposal an amount equal to the value of the asset at the time of the disposal.
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securities have been transferred by the trustees of a premiums trust fund in pursuance of an arrangement mentioned in section 129(1), (2) or (2A) of the Taxes Act 1988,
the transfer was made to enable another person to fulfil a contract or to make a transfer,
securities have not been transferred in return, and
section 129(3) of that Act applies to the transfer made by the trustees.
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Subsections (2) to (5) above do not apply to FOTRA securities forming part of a member’s premiums trust fund at the beginning or end of any underwriting year if—
the member is not domiciled in the United Kingdom at any time in the year, and
he is either not ordinarily resident in the United Kingdom during the year or a non-resident United Kingdom trader in the year.
In this section—
“non-resident United Kingdom trader” shall be construed in accordance with subsection (5) of that section;
“underwriting year” does not include the year 1993 or any earlier underwriting year.
If arrangements are made by the Council of Lloyd’s which— the provisions of that Part relating to taxation shall have effect in relation to any special reserve fund of a member set up under the arrangements.
enable such a special reserve fund as is referred to in Part I of Schedule 20 to this Act to be set up in relation to each member; and
comply with the requirements of that Part and are approved by the Board,
The arrangements may from time to time be varied with the consent of the Board.
If, after giving notice of their intention to do so to the Council of Lloyd’s, the Board cancel the approval which they have given with respect to the arrangements, paragraph 3 of Schedule 20 to this Act shall not apply, in the case of any member, to any year of assessment after the year of assessment in which the approval is cancelled.
The provisions of Part II of Schedule 20 to this Act shall have effect as respects the winding up of any special reserve fund which—
was set up under the arrangements mentioned in section 452(1) of the Taxes Act 1988; and
belongs to a member for whom a special reserve fund may be set up under the arrangements mentioned in subsection (1) above.
A member shall be treated for the purposes of the Income Tax Acts and the Gains Tax Acts as absolutely entitled as against the trustees to the assets forming part of an ancillary trust fund of his.
The cost of acquisition and the consideration for the disposal of assets forming part of an ancillary trust fund—
shall be left out of account in computing for the purposes of income tax the profits or losses of the member’s underwriting business; and
accordingly, shall not be excluded for the purposes of capital gains tax under section 37 or 39 of the Gains Tax Act.
None of the following provisions (which apply where an individual entitled to securities dies), namely— shall apply where the individual concerned is a member and the security concerned forms part of an ancillary trust fund of his.
section 636 of ITA 2007 (exception where there is a transfer to a legatee);
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In a case where subsection (3)(a) above applies, the deceased’s personal representatives shall be treated for the purposes of Part 12 of ITA 2007 and section 728 of the Taxes Act 1988 as the transferor or transferee in relation to transfers of securities as to which the deceased was the transferor or transferee (as the case may be) in the interest period in which he died.
This section applies where—
in accordance with the rules or practice of Lloyd’s and in consideration of the payment of a premium, one member agrees with another to meet liabilities arising from the latter’s underwriting business for an underwriting year so that the accounts of the business for that year may be closed; and
the member by whom the premium is payable is a continuing member, that is, a member not only of the syndicate as a member of which he is liable to pay the premium (“the reinsured syndicate”) but also of the syndicate as a member of which the other member is entitled to receive it (“the reinsurer syndicate”).
In computing for the purposes of income tax the profits of the continuing member’s underwriting business as a member of the reinsured syndicate, the amount of the premium shall be deductible as an expense of his only to the extent that it is shown not to exceed a fair and reasonable assessment of the value of the liabilities in respect of which it is payable.
In computing for those purposes the profits of the continuing member’s underwriting business as a member of the reinsurer syndicate, those profits shall be reduced by an amount equal to any part of a premium which, by virtue of subsection (2) above, is not deductible as an expense of his as a member of the reinsured syndicate.
The assessment referred to in subsection (2) above shall be taken to be fair and reasonable only if it is arrived at with a view to producing the result that a profit does not accrue to the member to whom the premium is payable but that he does not suffer a loss.
In computing for the purposes of income tax the profits of a member’s underwriting business, each of the following shall be deductible as an expense, namely—
any premium payable by him under a stop-loss insurance, and any repayment of insurance money paid to him under such an insurance;
any amount payable by him into the High Level Stop Loss Fund, and any repayment of an amount paid to him out of that Fund; and
where an amount is payable by him under a quota share contract—
so much of that amount as exceeds the amount of transferred losses that are declared on or before the date the contract takes effect (“the declared amount”), or
if the contract does not take effect, the amount so payable under the contract.
Subject to subsection (3) below, each of the following, namely— shall be treated as a trading receipt in computing the profits arising from that business for the year of assessment which corresponds to the underwriting year in which the loss was declared.
any insurance money payable to a member under a stop-loss insurance in respect of a loss in his underwriting business; and
any amount payable to a member out of the High Level Stop Loss Fund in respect of such a loss,
Where, as respects the payment of any such insurance money or amount as is mentioned in subsection (2) above— that subsection shall have effect in relation to that insurance money or amount as if it referred instead to the year of assessment which corresponds to the underwriting year in which the payment is made.
the inspector is not notified of the payment at least 30 days before the time after which any assessment or further assessment of profits for the year of assessment is precluded by section 34 of the Management Act (ordinary time limit of 4 years), and
the inspector is not entitled, after that time, to make any such assessment or further assessment by virtue of section 36 (loss of tax brought about carelessly or deliberately) or 40(2) (assessment on personal representatives) of that Act,
For the purposes of this section—
is made in accordance with the rules or practice of Lloyd's; and
provides for that other person to take over any rights and liabilities of the member under any of the syndicates of which he is a member.
“quota share contract” means any contract between a member and another person which— and where the taking over of a member’s rights and liabilities is conditional upon the occurrence of any event, the contract does not take effect until that event occurs; and
“underwriting business”, in relation to a successor company, has the same meaning as in Chapter 5 of Part 4 of the Finance Act 1994.
Where the amount payable by a member under a quota share contract is less than the declared amount, the difference between the two amounts shall be treated as a trading receipt in computing the profits arising from the member’s underwriting business in the year of assessment which corresponds to the underwriting year in which the contract takes effect.
Where a member has entered a quota share contract, any amount paid by him to cover a cash call in respect of transferred losses that are not declared at the time the contract takes effect shall be treated—
for the purposes of subsection (1)(c)(i) and (3A) above, as an amount payable under the contract, and
for the purposes of section 172, as a payment made at the time the contract takes effect.
Subject to subsection (5) below, this section applies where a member ceases to carry on his underwriting business, whether by reason of death or otherwise.
Subject . . . to the provisions of any regulations made by the Board, the member’s final year of assessment shall be that which corresponds to the underwriting year in which his deposit at Lloyd’s is paid over to him or his personal representatives or assigns.
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For the purposes of section 171 above and all other purposes of the Income Tax Acts, any profits or losses arising to the member from his underwriting business which are not taken (by virtue of the provisions of this Chapter) to be profits or losses of an earlier year of assessment shall be taken to be profits or losses of his final year of assessment.
This section does not apply in any case where the member’s deposit at Lloyd’s is paid over to him or his personal representatives or assigns before 1st January 1993.
In relation to any member, all profits arising to him from his underwriting business—
shall be treated for the purposes of the Income Tax Acts as immediately derived from the carrying on by him of that business, and
accordingly, shall constitute—
for the purposes of Part 4 of the Finance Act 2004, relevant UK earnings within section 189(2)(b) of that Act, and
income in relation to which the treatment in section 836(2) of ITA 2007 does not apply.
This section does not apply in relation to profits of the year 1992-93 or earlier years of assessment.
This section applies where a member ceases to carry on his underwriting business by reason of death.
For the purposes of assessing the profits of the member’s underwriting business, the member shall be treated as having died at the end of the year of assessment which corresponds to the underwriting year immediately preceding that in which he actually died.
For the purposes of the Income Tax Acts—
the carrying on of the member’s underwriting business by his personal representatives shall not be treated as a change in the persons engaged in the carrying on of that business; and
subject to the provisions of any regulations made by the Board, the business shall be treated as continuing until the member’s deposit at Lloyd’s is paid over to his personal representatives.
In section 43 of the Finance Act 1989 (Schedule D: computation), subsections (6) and (7) (which extend certain time limits for persons permitted by the Council of Lloyd’s to act as underwriting agents at Lloyd’s) shall cease to have effect in relation to periods of account ending on or after 30th June 1993.
Schedule 20A to this Act (which makes provision for certain reliefs to be available where a member converts to limited liability underwriting or a Lloyd’s partnership converts to underwriting through a company) shall have effect.
The Board may by regulations provide—
for the assessment and collection of tax charged in accordance with section 171 above . . . ;
for making, in the event of any changes in the rules or practice of Lloyd’s, such amendments of this Chapter as appear to the Board to be expedient having regard to those changes;
for modifying the application of this Chapter in cases where a syndicate continues after the end of its closing year or a member dies or otherwise ceases to carry on his underwriting business;
for giving credit for foreign tax.
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Regulations made, or deemed to have been made, under any of the following enactments (regulations about Lloyd’s underwriters), namely— which were in force immediately before 6th April 1992 shall continue in force for the year 1992-93 and subsequent years of assessment notwithstanding the repeal of that enactment by this Act, and shall be deemed to have been made under this section.
section 451(1) or (1A) of the Taxes Act 1988,
section 92(5) of the Finance Act 1989, or
section 209(4) of the Gains Tax Act,
Any power to make regulations conferred by this section includes power to make—
different provision for different cases or different purposes, and
incidental, supplemental or transitional provision and savings.
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In section 710(14) of that Act (meaning of “business” and “premiums trust fund”), for the words “section 457” there shall be substituted the words “ section 184 of the Finance Act 1993 ”.
In the following provisions (which relate to nominees, trustees etc.), namely— Section 720(3) of the Taxes Act 1988, paragraph 18(1) of Schedule 4 to that Act, paragraph 10(1) of Schedule 11 to the Finance Act 1989, and paragraph 18(1) of Schedule 10 to the Finance Act 1990, the words from “his special reserve fund” to the end shall be omitted.
In the following provisions (which relate to the death of a member), namely— section 721(5) of the Taxes Act 1988, paragraph 18(8) of Schedule 4 to that Act, paragraph 10(6) of Schedule 11 to the Finance Act 1989, and paragraph 18(6) of Schedule 10 to the Finance Act 1990, the words from “a special reserve fund” to the end shall be omitted.
In section 206(2) of the Gains Tax Act (Lloyd’s underwriters), after the words “subsection (1) above” there shall be inserted the words “ and section 174(1) of the Finance Act 1993 ”.
In section 209 of that Act (interpretation, regulations about underwriters etc.)—
in subsection (1), for the words “sections 450 to 456 of the Taxes Act” there shall be substituted the words “ Chapter III of Part II of the Finance Act 1993 ” and for the words “sections 450 to 456”, in the second place where they occur, there shall be substituted the words “ that Chapter ”; and
in subsection (6), the words “or (4)” shall be omitted.
In this Chapter, unless the context otherwise requires—
For the purposes of this Chapter—
an underwriting year and a year of assessment shall be deemed to correspond to each other if the underwriting year ends in the year of assessment;
the profits or losses of a member’s underwriting business include profits or losses arising to him from assets forming part of a premium trust fund or an ancillary trust fund; and
any charge made on a member by the managing agent of a syndicate of which he is a member, and any expense incurred on his behalf by the managing agent of such a syndicate, shall be treated as expenses arising directly from his membership of that syndicate.
Subject to any provision to the contrary, the provisions of this Chapter have effect for the year 1992-93 and subsequent years of assessment.
An oil field meets the conditions in this subsection if it is an oil field— . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
for no part of which consent for development was granted to a licensee by the Secretary of State before 16th March 1993; and
for no part of which a programme of development was served on a licensee or approved by the Secretary of State before that date;
In this Part of this Act—
For the purposes of subsection (1) above, no account shall be taken, in relation to an oil field, of a consent for development granted before 16th March 1993 or a programme of development served on a licensee or approved by the Secretary of State before that date if—
in whole or in part that consent or programme related to another oil field for which a determination under Schedule 1 to the principal Act was made before the determination under that Schedule for the field in question; and
on or after 16th March 1993, a consent for development is or was granted or a programme of development is or was served on a licensee or approved by the appropriate authority and that consent or programme relates, in whole or in part, to the field in question.
Petroleum revenue tax shall not be charged in accordance with the Oil Taxation Acts in respect of—
profits from oil won from a non-taxable field under the authority of such a licence as is referred to in section 1(1) of the principal Act; or
any receipts accruing to a participator in a non-taxable field which, in the case of a taxable field, would be tariff receipts or disposal receipts attributable to the field for any period.
An oil field meets the conditions in this subsection if—
the field does not meet the conditions in subsection (1), and
an election under Schedule 20B that the field is to be non-taxable is in effect.
Without prejudice to the generality of subsection (3) above—
in section 1(2) of the principal Act (the charge to tax) after the words “oil field” there shall be inserted “ which is a taxable field ”;
in section 3(1D) of the principal Act (apportionment of expenditure between oil field and non-oil field use) for the words “an oil field”, in both places where they occur, there shall be substituted “ a taxable field ”;
in section 5B of the principal Act (allowance of research expenditure) in subsection (6) after the words “this Act” there shall be inserted “ or for purposes relating to non-taxable fields ”;
no computation shall be made under the Oil Taxation Acts of the assessable profit or allowable loss accruing to a participator in any period from a non-taxable field; and
no expenditure shall be regarded as allowable (or allowed) for a non-taxable field under the Oil Taxation Acts.
An oil field meets the conditions in this subsection if—
the field does not meet the conditions in subsection (1),
the Secretary of State has at any time approved one or more abandonment programmes under Part 4 of the Petroleum Act 1998 (or Part 1 of the Petroleum Act 1987) in relation to all assets of the field which are relevant assets;
those programmes have been carried out to the satisfaction of the Secretary of State;
a development decision is made in relation to the field; and
that decision is made on or after 16th March 1993 and after those programmes have been so carried out.
In section 12(1) of the principal Act (interpretation) at the end of the definition of “oil field” there shall be added the words “ and “taxable field” and “non-taxable field” have the same meaning as in Part III of the Finance Act 1993 ”.
For the purposes of subsection (1A)(a) above, an asset is a relevant asset of an oil field if—
it has at any time been a qualifying asset (within the meaning of the 1983 Act) in relation to any participator in the field; and
it has at any time been used for the purpose of winning oil from the field.
Subject to paragraphs (b) and (c) of subsection (4) above, where, apart from this section, expenditure incurred on or after 16th March 1993 would fall to be apportioned (as being allowable expenditure) between two or more oil fields, at least one of which is a non-taxable field, the apportionment shall be made as if all the fields were taxable fields, but subsection (4)(e) above shall then apply to any amount of expenditure apportioned to a non-taxable field.
For the purposes of subsection (1A)(c) and (d) above, a development decision is made in relation to an oil field when—
consent for development is granted to a licensee by the appropriate authority in respect of the whole or part of the field; or
a programme of development is served on a licensee or approved by the appropriate authority for the whole or part of the field.
In this section above “development”, in relation to an oil field, means— and consent for development does not include consent which is limited to the purpose of testing the characteristics of an oil-bearing area and does not relate to the erection or carrying out of permanent works.
the erection or carrying out of permanent works for the purpose of getting oil from the field or for the purpose of conveying oil won from the field to a place on land; or
winning oil from the field otherwise than in the course of searching for oil or drilling wells;
In subsection (7) above “permanent works” means any structures or other works whatsoever which are intended by the licensee to be permanent and are neither designed to be moved from place to place without major dismantling nor intended by the licensee to be used only for searching for oil.
In subsections (1C) and (2), “"the appropriate authority”” means—
in relation to a field that is wholly within the Scottish onshore area, as defined in section 8A of the Petroleum Act 1998, the Scottish Ministers;
in relation to a field that is wholly within the Welsh onshore area (as defined in section 8A of the Petroleum Act 1998), the Welsh Ministers;
otherwise, the OGA.
With respect to chargeable periods ending after 30th June 1993 the rate of petroleum revenue tax (relevant only to taxable fields) shall be 50 per cent. and, accordingly, with respect to such periods, in section 1(2) of the principal Act for “75” there shall be substituted “ 50 ”.
In paragraph 17 of Schedule 2 to the principal Act (limit on interest in the case of relief for losses carried back) at the end of sub-paragraph (2) there shall be added the words “ and, in relation to the appropriate repayment, the chargeable period for which the relevant assessment or amendment is made is referred to as “the repayment period” ”.
In sub-paragraph (4) of that paragraph—
at the beginning there shall be inserted the words “ Subject to sub-paragraph (6) below ”; and
in paragraph (a) for the words “85 per cent.” there shall be substituted “ the relevant percentage of the amount ” and after the word “above” there shall be inserted “ which is treated as reducing the assessable profit of the repayment period ”.
At the end of that paragraph there shall be added the following sub-paragraphs—
In Schedule 2 to the principal Act (management and collection of petroleum revenue tax), other than the Table in paragraph 1 (modifications of the Taxes Management Act 1970),— andparagraph 7 (which is superseded by the following provisions of this section) shall be omitted.
for the words “an oil field”, in each place where they occur, there shall be substituted “ a taxable field ”; and
for the words “the oil field”, in each place where they occur, there shall be substituted “ the taxable field ”;
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to deliver to a named officer of the Board such documents as are in the person’s possession or power and as (in the Board’s reasonable opinion) contain, or may contain, information relevant to—
any tax liability to which that person is or may be subject, or
the amount of any such liability; or
to furnish to a named officer of the Board such particulars as the Board may reasonably require as being relevant to, or to the amount of, any such liability.
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as are in his possession or power; and
as (in the Board’s reasonable opinion) contain, or may contain, information relevant to—
any tax liability to which the taxpayer is or may be or may have been subject; or
the amount of any such liability.
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that the notice relates to a taxpayer whose identity is not known to the Board or to a class of taxpayers whose individual identities are not so known;
that there are reasonable grounds for believing that the taxpayer or any of the class of taxpayers to whom the notice relates may have failed or may fail to comply with any provision of the Oil Taxation Acts;
that any such failure is likely to have led or to lead to serious prejudice to the proper assessment or collection of tax; and
that the information which is likely to be contained in any documents to which the notice relates is not readily available from another source.
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In section 5A of the principal Act (allowance of exploration and appraisal expenditure), in subsection (1) (conditions for expenditure to be allowable) after paragraph (a) there shall be inserted the following paragraph—.
After subsection (1) of that section there shall be inserted the following subsections—
In subsection (2) of that section for the words “subsection (1)” there shall be substituted “ subsections (1) to (1C) ”.
This section applies in any case where—
a participator in an oil field or an associate incurs expenditure on or after 16th March 1993 and before 1st January 1995; and
apart from this section, that expenditure would not be allowable under section 5A of the principal Act (as amended by section 188 above); and
if section 188 above had not been enacted, the expenditure would be allowable in the case of the participator under section 5A of the principal Act; and
on 16th March 1993 the participator or the associate was a licensee in respect of the area to which the expenditure related.
In the following provisions of this section—
expenditure falling within subsection (1) above is referred to as “transitional E and A expenditure”; and
the participator in whose case that expenditure would be allowable as mentioned in paragraph (c) of that subsection is referred to as “the claimant”.
Subject to the following provisions of this section, so much of the transitional E and A expenditure incurred by the claimant or an associate as does not in the aggregate exceed £10 million shall be allowable in the case of the claimant under section 5A of the principal Act (as exploration and appraisal expenditure).
In subsections (1) to (3) above any reference to an associate of a participator applies only where the participator is a company and is a reference to another company— and subsections (7) and (8) of section 5 of the principal Act (companies and associates etc.) apply for the purposes of this section as they apply for the purposes of that section.
which on 16th March 1993 was a member of the same group of companies as the participator; and
with which the participator is associated in respect of expenditure incurred by the other company;
Where— subsection (3) above shall have effect as if references therein to the claimant were references to the aggregate of all those companies which on that date were members of the group and are the claimants in relation to any transitional E and A expenditure.
the claimant is a company, and
on 16th March 1993 the claimant was a member of a group of companies, and
at least one other company which was a member of the group on that date was then a participator in an oil field, and
that other company is also the claimant in relation to an amount of transitional E and A expenditure,
In this section, a group of companies means a company which is not a 51 per cent. subsidiary of any other company, together with each company which is its 51 per cent. subsidiary; and section 838 of the Taxes Act 1988 (subsidiaries) applies for the purposes of this section as it applies for the purposes of the Tax Acts (within the meaning of that Act).
Where, in the case of expenditure incurred as mentioned in section 1(1) of the 1983 Act (expenditure incurred on non-dedicated mobile assets),— that proportion of the expenditure which is equal to the proportion of the claim period during which the asset is dedicated to a non-taxable field shall not be allowable as mentioned in paragraph (a) above.
the expenditure would, apart from this subsection, be allowable under section 4 of the principal Act for a claim period of a taxable field, and
during that claim period, the asset becomes dedicated to a non-taxable field,
For the purpose of determining whether an asset becomes at any time dedicated to a non-taxable field, it shall be assumed that, in relation to a non-taxable field, any reference in section 2 of the 1983 Act (dedicated mobile assets) to a claim period is a reference to—
the period ending at the end of December following the determination of the field; or
the period of twelve months ending at the end of December in any later year.
In paragraph 7 of Schedule 1 to the 1983 Act (brought-in assets) in sub-paragraph (1)(c) (which requires that during the initial period the asset should have been used otherwise than in connection with an oil field) for the words “an oil field” there shall be substituted “ a taxable field ”.
In paragraph 8 of that Schedule (subsequent use of new asset otherwise than in connection with an oil field) in the heading and in sub-paragraphs (1) to (3) and (6) for the words “an oil field” there shall be substituted “ a taxable field ”.
In paragraph 5 of Schedule 2 to the 1983 Act (acquisition otherwise than at arm’s length: limit on tariff and disposal receipts)—
in paragraphs (a) and (c) of sub-paragraph (1) for the words “an oil field” there shall be substituted “ a taxable field ”;
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in sub-paragraph (3)(a) for the words “an oil field” there shall be substituted “ a taxable field ”; and
in sub-paragraph (3)(b) for the words “an oil field” there shall be substituted “ a taxable field or, if it is to a participator in a taxable field, the asset is to be used wholly or partly in connection with a non-taxable field ”.
Subject to the following provisions of this section, where a claim is made under the principal Act for the allowance of any expenditure and the claim is received by the Board after 16th March 1993, an amount of expenditure is to be taken to be incurred for the purposes of the Oil Taxation Acts on the date on which the obligation to pay that amount becomes unconditional (whether or not there is a later date on or before which the whole or any part of that amount is required to be paid).
Subject to subsection (3) below, where the amount of any expenditure incurred by any person at any time after 16th March 1993 under a contract— is disproportionate to the extent to which that other person has, at or before that time, performed his obligations under the contract then, for the purposes of the Oil Taxation Acts, only so much of the expenditure shall be taken to have been incurred at that time as is proportionate to those obligations which have been so performed.
for the acquisition from any other person of, or of an interest in, an asset, or
for the provision by any other person of services or other business facilities of whatever kind (whether in connection with the use of an asset or not), or
for the grant or transfer to that person by any other person of any right, licence or interest (other than an interest in an asset)
If, in the case of a contract entered into after 16th March 1993 and falling within paragraph (a) or paragraph (b) of subsection (2) above— the contractor shall be treated for the purposes of subsection (2) above as having at any time performed his obligations under the contract only to the extent that, at that time, the asset or interest in question has been acquired by, or, as the case may be, the services or other business facilities have been provided to, the person incurring the expenditure.
the expenditure referred to in that subsection is incurred before 1st July 1993, and
the other person referred to in paragraph (a) or paragraph (b) (“the contractor”) has performed his obligations by entering into one or more further contracts,
Where, in a transaction to which this paragraph applies, a person has incurred expenditure in acquiring, bringing into existence or enhancing the value of an asset, he shall at any time be treated for the purposes of— as having incurred that expenditure only to the extent that it does not exceed expenditure (other than loan expenditure) incurred up to that time in a transaction to which this paragraph does not apply (or, if there has been more than one such transaction, the later or latest of them) in acquiring, bringing into existence or enhancing the value of, that asset. Subsections (1) to (3) of section 191 of the Finance Act 1993 apply to determine for the purposes of this paragraph what expenditure has at any time been incurred under a transaction to which this paragraph does not apply, as they apply in relation to expenditure for the allowance of which a claim is received by the Board after 16th March 1993. In sub-paragraph (1) above “loan expenditure” means expenditure in respect of interest or any other pecuniary obligation incurred in obtaining a loan or any other form of credit.
The preceding provisions of this section shall, with any necessary modification, apply in relation to expenditure incurred by any person in acquiring an interest in an asset or in bringing into existence an asset in which he is to have an interest, or in enhancing the value of an asset in which he has an interest, as those provisions apply in relation to expenditure incurred by a person in acquiring, bringing into existence, or enhancing the value of an asset, as the case may be. The provisions of sub-paragraphs (1) to (2) above shall, with any necessary modification, apply in relation to expenditure incurred by any person in respect of— as they have effect in relation to expenditure incurred in the acquisition of, or of an interest in, an asset.
The amendments made by subsections (4) and (5) above have effect where the transaction to which paragraph 2 of Schedule 4 to the principal Act applies takes place on or after 16th March 1993.
Where a claim which— has been allowed, the expenditure shall not be brought into account in determining the assessable profit or allowable loss of any chargeable period which ends earlier than the last day of the claim period in which the expenditure was incurred.
is made under Schedule 5 or Schedule 6 to the principal Act for the allowance of any expenditure, and
is received by the Board after 16th March 1993,
Where a claim has been made under Schedule 7 to the principal Act for the allowance of any expenditure incurred after 31st March 1993 and that claim has been allowed, the expenditure shall not be brought into account in determining the assessable profit or allowable loss of any chargeable period which ends before the date on which the expenditure was incurred.
The preceding provisions of this section have effect notwithstanding anything in subsection (9) of section 2 of the principal Act (under which expenditure which had been allowed might in certain cases be taken into account in earlier chargeable periods) and, accordingly, at the beginning of that subsection there shall be inserted “ Subject to section 192 of the Finance Act 1993 ”.
In section 9 of the 1983 Act (tariff receipts allowance) in subsection (5) (definition of “user field”) in paragraph (a) after the words “other than the principal field” there shall be inserted “ or a non-taxable field ”, and at the end of that subsection there shall be inserted the following subsection—
Where a participator in a taxable field incurs any expenditure and,— the expenditure shall be disregarded in determining the assessable profit or allowable loss referred to in paragraph (a) above.
apart from this subsection, the expenditure would be taken into account in determining the assessable profit or allowable loss accruing to that participator from the taxable field in any chargeable period, and
in the hands of the recipient, the expenditure would, on the relevant assumptions, constitute tariff receipts or disposal receipts of a participator in a non-taxable field attributable to that field for any period, and
at the time the expenditure is incurred, the participator referred to in paragraph (a) above is or is connected with a participator in the non-taxable field referred to in paragraph (b) above,
For the purposes of subsection (2) above, the relevant assumptions are—
that the non-taxable field is a taxable field; and
that the asset which gives rise to the expenditure (by virtue of its use, the provision of services or other business facilities in connection with its use or its disposal) is a qualifying asset in relation to the participator in question.
In section 12 of the 1983 Act (charge of receipts attributable to United Kingdom use of foreign field asset), in subsection (3) after the words “oil field”, in the first place where they occur, there shall be inserted “ which is a taxable field and ”.
After subsection (3) of section 12 of the 1983 Act there shall be inserted the following subsection—
In this section “disposal receipts”, “qualifying asset” and “tariff receipts” have the same meaning as in the 1983 Act; and section 1122 of the Corporation Tax Act 2010 (connected persons) applies for the purposes of subsection (2)(c) above.
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For the purpose of giving relief from double taxation in relation to petroleum revenue tax in respect of the amount or value of consideration which is brought into charge to tax under section 12 of the 1983 Act (charge of receipts attributable to United Kingdom use of foreign field assets), section 788 of the Taxes Act 1988 (relief by agreement with other countries) shall have effect as if—
references therein to income tax included references to petroleum revenue tax; and
references therein to income included references to any such consideration.
Section 788 of the Taxes Act 1988, as it has effect in accordance with subsection (1) above, shall apply with respect to any arrangements which—
are set out in an Order in Council made, or having effect as if made, under that section before as well as after the passing of this Act; and
include petroleum revenue tax as a tax to which the arrangements apply.
In the application of section 788 of the Taxes Act 1988 in accordance with the preceding provisions of this section— shall be omitted.
paragraphs (b) to (d) of subsection (3),
subsections (4), (5) and (7), and
in subsection (6) the words from “Except” to “this Part”,
In relation to a claim for relief under section 788 of the Taxes Act 1988 which is made by virtue of this section, sections 42 and 43 of the Taxes Management Act 1970 shall have effect with the following modifications—
for any reference to income tax there shall be substituted a reference to petroleum revenue tax;
any reference to income shall be construed as a reference to such consideration as is referred to in subsection (1) above;
for any reference to a year of assessment there shall be substituted a reference to a chargeable period within the meaning of the principal Act; and
any reference to a chargeable period shall be construed as a reference to a chargeable period within the meaning of the principal Act.
Section 816 of the Taxes Act 1988 (disclosure of information) shall apply in relation to petroleum revenue tax as it applies in relation to income tax.
In this Part—
“the principal Act” means the Oil Taxation Act 1975 ;
“the 1983 Act” means the Oil Taxation Act 1983 ;
“the Oil Taxation Acts” means Parts I and III of the principal Act, the 1983 Act and any other enactment relating to petroleum revenue tax; and
“taxable field” and “non-taxable field” shall be construed in accordance with section 185 above.
The Board may make all such amendments of assessments or determinations or of decisions on claims as may be necessary in consequence of the provisions of this Part.
This Part... shall be construed as one with Part I of the principal Act.
The Table substituted by section 72(1) of the Finance (No.2) Act 1992 shall apply to chargeable transfers made in the year beginning 6th April 1993, and accordingly section 8(1) of the Inheritance Tax Act 1984 (indexation of rate bands)shall not apply to such transfers.
In section 8 of the Inheritance Tax Act 1984 (indexation of rate bands)—
in subsection (1) for “December in 1984” there shall be substituted “ September in 1993 ” and for “previous December” there shall be substituted “ previous September ”;
in subsection (3) for “December” there shall be substituted “ September ”;
in subsection (4) for “1985” there shall be substituted “ 1994 ”.
This section shall apply in relation to chargeable transfers made on or after 6th April 1994.
In the Inheritance Tax Act 1984, in Part VI (valuation) in Chapter III (sale of shares etc. from deceased’s estate) there shall be inserted after section 186—
This section shall have effect in relation to deaths occurring on or after 16th March 1992.
In the Inheritance Tax Act 1984, in Part VI, in Chapter IV (sale of land from deceased’s estate) after section 197 there shall be inserted—
This section shall have effect in relation to deaths occurring on or after 16th March 1990.
In section 222 of the Inheritance Tax Act 1984 (appeals against determinations) for subsection (4) there shall be substituted the following subsections—
In section 242 of that Act (recovery of tax) in subsection (3) for the words “subsection (4)” there shall be substituted the words “ subsections (4) to (4B) ”.
This section shall apply in relation to any appeal which—
is made on or after the day on which this Act is passed, or
is made, but has not begun to be heard, before that day.
Section 55 of the Finance Act 1963 (stamp duty under or by reference to conveyance or transfer on sale heading) and section 4 of the Finance Act (Northern Ireland) 1963 (equivalent provision for Northern Ireland) shall be amended as follows—
in subsection (1) of each section for “£30,000” (in each place) there shall be substituted “£60,000”;
in subsection (2) of each section for “£300” there shall be substituted “£600”.
This section applies to—
instruments executed on or after 16th March 1993 and before 23rd March 1993 and not stamped before 23rd March 1993;
instruments executed on or after 23rd March 1993.
For the purposes of section 14(4) of the Stamp Act 1891 (instruments not to be given in evidence etc. unless stamped in accordance with the law in force at the time of first execution) the law in force at the time of execution of an instrument falling within subsection (2)(a) above shall be deemed to be that as varied in accordance with subsection (1) above.
This section shall be deemed to have come into force on 23rd March 1993.
Subsection (2) below applies where—
a person exercises the right to acquire on rent to mortgage terms under Part V of the Housing Act 1985, and
in pursuance of the exercise of that right a conveyance of the freehold is executed in his favour as regards the dwelling-house concerned.
For the purposes of the enactments relating to stamp duty chargeable under Part I of Schedule 13 to the Finance Act 1999 (conveyance or transfer on sale), the consideration for the sale shall be taken to be equal to the price which, by virtue of section 126 of the Housing Act 1985, would be payable for the dwelling-house on a conveyance if the person were exercising the right to buy under Part V of that Act.
Subsection (4) below applies where—
a person exercises the right to acquire on rent to mortgage terms under Part V of the Housing Act 1985, and
in pursuance of the exercise of that right a lease is executed in his favour as regards the dwelling-house concerned.
In such a case—
the lease shall not be chargeable with stamp duty under Part II of Schedule 13 to the Finance Act 1999 (lease) but shall be chargeable with stamp duty under Part I of that Schedule (conveyance or transfer on sale) as if it were a conveyance on sale;
for the purposes of the enactments relating to stamp duty chargeable under Part I of that Schedule the consideration for the sale mentioned in paragraph (a) above shall be taken to be equal to the price which, by virtue of section 126 of the Housing Act 1985, would be payable for the dwelling-house on a grant if the person were exercising the right to buy under Part V of that Act.
This section shall apply where the conveyance or lease is executed after the day on which this Act is passed.
Subsection (2) below applies where—
a person exercises the right to purchase a house by way of the rent to loan scheme under Part III of the Housing (Scotland) Act 1987, and
in pursuance of the exercise of that right a heritable disposition of the house is executed in favour of him.
For the purposes of the enactments relating to stamp duty chargeable under Part I of Schedule 13 to the Finance Act 1999 (conveyance or transfer on sale), the consideration for the sale shall be taken to be equal to the price which, by virtue of section 62 of the Housing (Scotland) Act 1987, would be payable for the house if the person were exercising the right to purchase under section 61 of that Act.
This section shall apply where the disposition is executed after the day on which this Act is passed.
The Treasury may make regulations as to the method by which stamp duty is to be denoted.
In particular, regulations under this section may— and cases may be designated by reference to the type of instrument concerned, the geographical area involved, or such other factors as the Treasury think fit.
provide for duty to be denoted by impressed stamps or adhesive stamps or by a record printed or made by a machine or implement or by such other method as may be prescribed;
provide for one method only to be used, whether generally or in prescribed cases;
provide for alternative methods to be available, whether generally or in prescribed cases;
make different provision for different cases;
Regulations under this section may provide that where stamp duty is denoted by a method which (in the case of the instrument concerned) is required or permitted by the law in force at the time it is stamped, for the purposes of section 14(4) of the Stamp Act 1891 (instruments not to be given in evidence etc. unless stamped in accordance with the law in force at the time of . . . execution) the method shall be treated as being in accordance with the law in force at the time when the instrument was . . . executed.
Regulations under this section may include such supplementary, incidental, consequential or transitional provisions as appear to the Treasury to be necessary or expedient.
Regulations under this section may make provision in such way as the Treasury think fit, and in particular may amend or repeal or modify the effect of any provision of any Act.
In this section “prescribed” means prescribed by regulations under this section.
The power to make regulations under this section shall be exercisable by statutory instrument subject to annulment in pursuance of a resolution of the House of Commons.
The Provisional Collection of Taxes Act 1968 shall be amended as follows.
In section 1(1) (taxes to which section 1 applies)—
after “income tax,” there shall be inserted “ corporation tax (including advance corporation tax) ”;
the words “car tax” shall be omitted.
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In section 1(4) (resolution to cease to have statutory effect unless Bill read a second time within twenty-five sitting days) for “twenty-five” there shall be substituted “ thirty ”.
In section 5 (resolution giving provisional effect to motions)—
in subsection (1), paragraph (c) and the word “or” immediately preceding it shall be omitted;
in subsection (2) for “, sections 8(5) and 822 of the 1988 Act” there shall be substituted “ and section 822 of the Income and Corporation Taxes Act 1988 ”.
This section shall apply in relation to resolutions passed after the day on which this Act is passed.
In section 8 of the Taxes Act 1988 (general scheme of corporation tax) subsections (4) to (6) (assessments where tax not charged for year etc.) shall be omitted.
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In section 50(2) of the Finance Act 1973 (period of temporary statutory effect of resolution affecting stamp duties)—
in paragraph (a) (period by reference to twenty-fifth day of Commons sitting) for “twenty-fifth” there shall be substituted “ thirtieth ”;
in paragraph (d) (period by reference to five months beginning with day resolution takes effect) for “five” there shall be substituted “ six ”.
This section shall apply in relation to resolutions passed after the day on which this Act is passed.
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In section 9 of the Taxation of Chargeable Gains Act 1992 (residence, including temporary residence) the following subsection shall be inserted after subsection (3)—
In consequence of subsection (1) above, in section 267(4) of the Inheritance Tax Act 1984 (residence in United Kingdom determined as for purposes of income tax) the words “but without regard to any dwelling-house available in the United Kingdom for his use” shall be omitted.
Subsections (1) and (2) above shall have effect for the year 1993-94 and subsequent years of assessment.
Subsection (3) above shall have effect where the year of assessment concerned is 1993-94 or a subsequent year of assessment.
In section 123 of the Finance Act 1990 (gas levy) in subsection (3) (future variation or termination of rights and liabilities under tax-exempt contracts etc. to be disregarded, except in certain cases) at the end of paragraph (b) there shall be added the words “or pursuant to a term in a contract or document which is certified for the purposes of this paragraph by the Secretary of State with the approval of the Treasury”.
After subsection (3) of that section there shall be inserted the following subsections—
Where a person ceases to be liable to pay gas levy in respect of any gas won by him by virtue of the fact that winning the gas, in accordance with a contract or document, has ceased to be commercially viable, then, with respect to any chargeable period which ends— any oil (whether or not consisting of gas) won and saved from the field from which the gas is won shall cease to be disregarded under section 10(1)(b) of the Oil Taxation Act 1975 (PRT disregard of up to 5 per cent of oil production incidental to the production of gas sold to the British Gas Corporation).
after that cessation of liability to pay gas levy, and
after 30th June 1993,
Schedule 22 to this Act (which contains provisions about trading funds) shall have effect.
With a view to facilitating the raising of money by means of the issue of securities under section 12 of the National Loans Act 1968 (power of Treasury to borrow) the National Debt Commissioners may—
acquire securities issued under that section, and
transfer such securities.
Subject to subsection (8) below, the sums required by the Commissioners for or for purposes connected with the acquisition of securities under this section shall be issued to the Commissioners out of the National Loans Fund.
Except so far as directions by the Treasury authorise the application of the sums for any purpose for which sums may be issued under subsection (2) above, the Commissioners shall pay into the National Loans Fund—
any sums received by them by way of dividend or other return on securities acquired under this section;
any sums received by them in respect of the redemption of such securities;
any sums received by them in respect of the transfer of such securities.
The Commissioners shall prepare accounts relating to securities acquired under this section and shall send the accounts to the Comptroller and Auditor General.
The Comptroller and Auditor General shall examine, certify and report on accounts sent to him under subsection (4) above and lay a copy of them and of his report on them before each House of Parliament.
For the purpose of facilitating either the proper management by the Commissioners of their investments and other holdings or the carrying out of any of their other functions—
sums may be advanced to the Commissioners out of the National Loans Fund against securities for the time being held by them for any purpose other than those for which they may be acquired under this section; and
the Commissioners' powers shall include power to treat securities acquired under this section as appropriated to any such other purpose.
This section shall have effect, and the appropriate sums shall be charged on or payable into the National Loans Fund, as if—
any making by virtue of subsection (6)(a) above of an advance against any securities involved an acquisition of the securities for the purposes for which they may be acquired under this section; and
any exercise of the power mentioned in subsection (6)(b) above involved the exercise of the power to transfer securities acquired under this section.
The following rules shall apply for the purposes of this section—
sums issued out of or paid into the National Loans Fund under this section shall be of such amount, and shall be so issued or paid at such times and in such manner, as the Treasury may direct;
accounts prepared under subsection (4) above shall be in such form, shall be prepared in respect of such periods, and shall be sent to the Comptroller and Auditor General at such times, as the Treasury may direct.
This section shall come into force on such day as the Treasury may appoint by order made by statutory instrument.
In this Act “the Taxes Act 1988” means the Income and Corporation Taxes Act 1988 , and “ITA 2007” means the Income Tax Act 2007.
The enactments specified in Schedule 23 to this Act (which include provisions which are already spent) are hereby repealed to the extent specified in the third column of that Schedule, but subject to any provision of that Schedule.
This Act may be cited as the Finance Act 1993.
Section 179B
This Part of this Schedule applies if the following conditions are satisfied. Condition 1 is that— Condition 2 is that all of the member’s outstanding syndicate capacity is disposed of by the member under a conversion arrangement to a successor company (“the syndicate capacity disposal”) with effect from the beginning of the underwriting year next following the member’s last underwriting year. Condition 3 is that, immediately before the syndicate capacity disposal,— Condition 4 is that the syndicate capacity disposal is made in consideration solely of the issue to the member of shares in the successor company. Condition 5 is that the successor company starts to carry on its underwriting business in the underwriting year ... next following the member’s last underwriting year. In this paragraph “the member’s last underwriting year”, in relation to a member who gives notice of his resignation from membership of Lloyd's, means the underwriting year during which, or at the end of which, he ceases to be an underwriting member and becomes a non-underwriting member in accordance with the rules or practice of Lloyd's. In this paragraph “outstanding syndicate capacity”, in relation to a member, means the syndicate capacity of the member other than any which—
This paragraph applies if— Section 83 of ITA 2007 shall apply as if the income so derived were profits on which the member was assessed under Part 2 of the Income Tax (Trading and Other Income) Act 2005 in respect of the member’s underwriting business for that year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
This paragraph applies if— The amount of the excess mentioned in sub-paragraph (1)(a) above (“the amount of the syndicate capacity gain”) shall for the purposes of capital gains tax be reduced by the amount of the rolled-over gain. For the purpose of computing any chargeable gain accruing to the member on a disposal by him of any issued share or any asset directly or indirectly derived from any issued share— and if the issued shares are not all of the same class, the apportionment between the shares under paragraph (a) above shall be in accordance with their market values at the time they were acquired by the member. In this paragraph “the amount of the rolled-over gain” means the lesser of— In this paragraph the “issued shares” means the shares in the successor company issued to the member in consideration for the syndicate capacity disposal.
This paragraph applies if— But this paragraph does not apply if— The amount of the excess mentioned in sub-paragraph (1)(b) above (“the amount of the ATF assets gain”) shall for the purposes of capital gains tax be reduced by the amount of the rolled-over gain. For the purpose of computing any chargeable gain accruing to the member on a disposal by him of any issued share or any asset directly or indirectly derived from any issued share— and if the issued shares are not all of the same class, the apportionment between the shares under paragraph (a) above shall be in accordance with their market values at the time they were acquired by the member. In this paragraph “the amount of the rolled-over gain” means the lesser of— If the market value, immediately before the ATF disposal, of the assets disposed of under that disposal exceeds 120% of the amount of the ATF assets required, the amount of the ATF assets gain shall for the purposes of sub-paragraph (5)(a) above be reduced by multiplying it by— where— R is the amount of the ATF assets required, and T is the market value, immediately before the ATF disposal, of the assets disposed of under that disposal. In sub-paragraph (6) above “the amount of the ATF assets required” means the appropriate percentage of the amount of security required to be provided by the successor company in respect of its underwriting business in the underwriting year in which the ATF disposal is made. In sub-paragraph (7) above “the appropriate percentage” means the percentage that equates to the percentage of the ordinary share capital of the successor company that is beneficially owned by the member immediately before the ATF disposal. This paragraph applies only on the first occasion on or after 6th April 2004 on which the member makes an ATF disposal. If a claim made by the member under paragraph 3 above is revoked, this paragraph shall apply as if the claim had never been made.
In this Part of this Schedule— For the purposes of this Part of this Schedule, shares comprised in any letter of allotment or similar instrument shall be treated as issued unless— Paragraphs 3 and 4 above (and paragraph 1 above so far as relating to those paragraphs) are to be construed as one with the Gains Tax Act.
This Part of this Schedule applies if the following conditions are satisfied. Condition 1 is that— Condition 2 is that all of the partnership’s outstanding syndicate capacity is disposed of by the partnership under a conversion arrangement to a successor company (the “syndicate capacity disposal”) with effect from the beginning of the underwriting year next following the partnership’s last underwriting year. Condition 3 is that, immediately before the syndicate capacity disposal,— For the purposes of sub-paragraph (4)(b), ignore any interest of a person other than a converting partner in the partnership’s syndicate capacity. Condition 4 is that the syndicate capacity disposal is made in consideration solely of the issue to the converting partners of shares in the successor company. Condition 5 is that the successor company starts to carry on its underwriting business in the underwriting year ... next following the partnership’s last underwriting year. In this paragraph “the partnership’s last underwriting year”, in relation to a partnership which gives notice of its resignation from Lloyd’s, means the underwriting year during which, or at the end of which, the partnership ceases to be an underwriting member and becomes a non-underwriting member in accordance with the rules or practice of Lloyd’s. In this paragraph “outstanding syndicate capacity”, in relation to a partnership, means the syndicate capacity of the partnership other than any which—
This paragraph applies if— The amount of the excess mentioned in sub-paragraph (1)(a) above (“the amount of the syndicate capacity gain”) shall for the purposes of capital gains tax be reduced by the amount of the rolled-over gain. For the purpose of computing any chargeable gain accruing to the partner on a disposal by the partner of any issued share or any asset directly or indirectly derived from any issued share— and if the issued shares are not all of the same class, the apportionment between the shares under paragraph (a) above shall be in accordance with their market values at the time they were acquired by the partner. In this paragraph “the amount of the rolled-over gain” means the lesser of— In this paragraph the “issued shares” means the shares in the successor company issued to the partner in consideration for the syndicate capacity disposal.
This paragraph applies if— But this paragraph does not apply if— The amount of the excess mentioned in sub-paragraph (1)(b) above (“the amount of the ATF assets gain”) shall for the purposes of capital gains tax be reduced by the amount of the rolled-over gain. For the purpose of computing any chargeable gain accruing to the relevant partner on a disposal by the relevant partner of any issued share or any asset directly or indirectly derived from any issued share— and if the issued shares are not all of the same class, the apportionment between the shares under paragraph (a) above shall be in accordance with their market values at the time they were acquired by the relevant partner. In this paragraph “the amount of the rolled-over gain” means the lesser of— If the market value, immediately before the ATF disposal, of the assets disposed of under that disposal exceeds 120% of the amount of the ATF assets required, the amount of the ATF assets gain shall for the purposes of sub-paragraph (5)(a) be reduced by multiplying it by— where— R is the amount of the ATF assets required, and T is the market value, immediately before the ATF disposal, of the assets disposed of under that disposal. In sub-paragraph (6) above “the amount of the ATF assets required” means the appropriate percentage of the amount of security required to be provided by the successor company in respect of its underwriting business in the underwriting year in which the ATF disposal is made. In sub-paragraph (7) above “the appropriate percentage” means the percentage that equates to the percentage of the ordinary share capital of the successor company that is beneficially owned by the relevant partner immediately before the ATF disposal. This paragraph applies— If a claim made under paragraph 5B is revoked, this paragraph applies as if the claim had never been made.
In this Part of this Schedule— For the purposes of this Part of this Schedule, shares comprised in any letter of allotment or similar instrument shall be treated as issued unless— Paragraphs 5B and 5C above (and paragraph 5A above so far as relating to those paragraphs) are to be construed as one with the Gains Tax Act.
This Part of this Schedule applies if the following conditions are satisfied. Condition 1 is that— Condition 2 is that all of the member’s outstanding syndicate capacity is disposed of by the member under a conversion arrangement to a successor partnership (“the syndicate capacity disposal”) with effect from the beginning of the underwriting year next following the member’s last underwriting year. Condition 3 is that the member is the only person who disposes of syndicate capacity under a conversion arrangement to the successor partnership. Condition 4 is that the successor partnership starts to carry on its underwriting business in the underwriting year next following the member’s last underwriting year. In this paragraph “the member’s last underwriting year”, in relation to a member who gives notice of his resignation from membership of Lloyd's, means the underwriting year during which, or at the end of which, he ceases to be an underwriting member and becomes a non-underwriting member in accordance with the rules or practice of Lloyd's. In this paragraph “outstanding syndicate capacity”, in relation to a member, means the syndicate capacity of the member other than any which—
This paragraph applies if— Section 83 of ITA 2007 (carry-forward of trading losses against subsequent profits) shall have effect, in its application in relation to the losses of the old underwriting business, as if the profits of the successor partnership’s underwriting business to which the member is beneficially entitled for that year were profits on which the member was assessed under Part 2 of the Income Tax (Trading and Other Income) Act 2005 in respect of the old underwriting business for that year. In sub-paragraph (2) above “the old underwriting business” means the member’s underwriting business carried on otherwise than through the successor partnership.
In this Part of this Schedule—
“ successor partnership” means—
This paragraph applies if a member— The member must give written notice of such withdrawal to an officer of the Board. Such a notice must be given no later than six months from the date of the withdrawal of the notice of resignation. All such adjustments shall be made, whether by discharge or repayment of tax, the making of assessments or otherwise, as are required as a result of the withdrawal of the notice of resignation (notwithstanding any limitation on the time within which any adjustment may be made). If a member fails, fraudulently or negligently, to comply with sub-paragraphs (2) and (3) above, section 95 of the Taxes Management Act 1970 shall apply to him as if he had fraudulently or negligently made an incorrect return, statement or declaration in connection with the claim for relief made by him under or by virtue of this Schedule. In this paragraph “tax” means income tax, capital gains tax or inheritance tax.
This paragraph applies if— The person must give written notice of such withdrawal to an officer of Revenue and Customs. Such a notice must be given no later than 6 months from the date on which the person first became aware of the withdrawal of the notice of resignation. Unless the person proves otherwise, it shall be assumed that the person became aware of the withdrawal of the notice on the day on which it was withdrawn. All such adjustments shall be made, whether by discharge or repayment of tax, the making of assessments or otherwise, as are required as a result of the withdrawal of the notice of resignation (notwithstanding any limitation on the time within which any adjustment may be made). If a person fails, carelessly or deliberately, to comply with sub-paragraph (2) or (3) above, Schedule 24 to the Finance Act 2007 shall apply as if— In this paragraph “tax” means income tax, capital gains tax or inheritance tax.
In this Schedule—
Paragraphs 2 and 3 above (and the other provisions of this Schedule so far as relating to those paragraphs) have effect in relation to syndicate capacity disposals (within the meaning of Part 1 of this Schedule) made on or after 6th April 2004. Paragraph 4 above (and the other provisions of this Schedule so far as relating to that paragraph) have effect in relation to ATF disposals (within the meaning of that paragraph) made on or after 6th April 2004 (even if the syndicate capacity disposal mentioned in that paragraph was made before that date). Paragraph 5B above (and the other provisions of this Schedule so far as relating to that paragraph) have effect in relation to syndicate capacity disposals (within the meaning of Part 1A of this Schedule) made on or after 19th December 2014. Paragraph 5C above (and the other provisions of this Schedule so far as relating to that paragraph) have effect in relation to ATF disposals (within the meaning of that paragraph) made on or after 19th December 2014 (even if the syndicate capacity disposal was made before that date). Paragraph 7 above (and the other provisions of this Schedule so far as relating to that paragraph) have effect in relation to syndicate capacity disposals (within the meaning of Part 2 of this Schedule) made on or after 6th April 2004.
The responsible person for a taxable field may make an election that the field is to be non-taxable. An election is irrevocable. The responsible person may not make an election unless each person who is a participator at the time the election is made agrees to the election being made. If the responsible person makes an election, the Commissioners may assume that each participator agrees to the election being made (unless it appears to the Commissioners that a participator does not agree).
An election must be made in writing.
An election must be notified to the Commissioners.
An election is deemed to have been made on the date on which notification of the election was sent to the Commissioners.
If an election is made, the field ceases to be taxable with effect from the start of the first chargeable period to begin after the election is made.
From the start of the first chargeable period to begin after an election is made, no allowable loss that accrues from the oil field is an allowable unrelievable field loss for the purposes of petroleum revenue tax.
In this Schedule— Expressions used in this Schedule and in Part 1 of the Oil Taxation Act 1975 have the same meaning in this Schedule as in Part 1 of that Act.