Jamaica - Economic situation and public investment (Vol. 2 of 2) : Public investment

A person who makes taxable supplies but is not registered is liable to be registered— except that a person is not liable to be registered by virtue of sub-paragraph (a) above on the ground that the value of his taxable supplies in a period of less than a year has exceeded the amount applicable to that period if the Commissioners are satisfied that the value of his taxable supplies in that period and the remaining quarter or quarters of the year will not exceed £5,000. Number of quarters comprised in period Amount applicable £ 1 1,750 2 3,000 3 4,250 4 5,000

A registered person who makes taxable supplies shall cease to be liable to be registered—

A person who, on 1st April 1973, will be liable to be registered shall notify the Commissioners of that fact within ten days of the earliest date after September 1972 on which he knows or could with reasonable diligence have known that he will be so liable or within such longer time as the Commissioners may allow ; and the Commissioners shall register any such person with effect from 1st April 1973.

The following three paragraphs apply to persons not required to notify the Commissioners under paragraph 3 of this Schedule.

A person who by virtue of paragraph 1(a) of this Schedule is liable to be registered after the end of any quarter shall notify the Commissioners of his liability within ten days of the end of that quarter and the Commissioners shall register any such person with effect from the twenty-first day of the next quarter or such earlier date as may be agreed between them and that person.

A person who, by virtue of paragraph 1(b) of this Schedule, is liable to be registered by reason of the value of his taxable supplies in any period shall notify the Commissioners of that liability not later than the beginning of that period, and the Commissioners shall register any such person with effect from the beginning of that period or such earlier date as may be agreed between them and that person.

Where a person who intends to make taxable supplies, and will be liable to be registered when he does so, notifies the Commissioners of the fact and requests to be registered the Commissioners may, subject to such conditions as they think fit to impose, register him from such date as may be agreed between them and that person.

A registered person who ceases to make taxable supplies shall notify the Commissioners of that fact within ten days of the date on which he does so and the Commissioners shall cancel the registration of any such person.

Where, by virtue of paragraph 2(a) of this Schedule, a registered person ceases to be liable to be registered and notifies the Commissioners of that fact, the Commissioners shall cancel his registration with effect from the end of the period of fourteen days beginning with the date on which he so notifies them or from such other date as may be agreed between them and that person.

Where a registered person requests the Commissioners to cancel his registration by virtue of paragraph 2(b) of this Schedule and the Commissioners are at any time satisfied as mentioned in that paragraph they shall cancel his registration as from that time.

Notwithstanding the preceding provisions of this Schedule,— until it appears to the Commissioners that the request should no longer be acted upon or the request is withdrawn; but the Commissioners may by notice given in such manner as appears to them appropriate for the information of persons making taxable supplies prevent the withdrawal of such a request made after the publication of the notice for such period after it is made as may be specified in the notice.

The provisions of this Part of this Act relating to the determination of the value of a supply of goods or services shall apply for the purposes of this Schedule with the modification that no allowance shall be made for tax.

Any notification required under this Schedule shall be made in such form and shall contain such particulars as the Commissioners may by regulations prescribe.

References in this Schedule to registration are references to registration in a register kept by the Commissioners for the purposes of this Part of this Act.

Value added tax tribunals shall be established for England and Wales, Scotland and Northern Ireland respectively.

There shall be a President of Value Added Tax Tribunals, who shall perform the functions conferred on him by the following provisions of this Schedule in relation to value added tax tribunals in any part of the United Kingdom. The President shall be appointed by the Lord Chancellor and shall be a barrister, advocate or solicitor of not less than ten years' standing.

The President may resign his office at any time and shall vacate his office at the end of the completed year of service in which he attains the age of seventy-two. The Lord Chancellor may, if he thinks fit, remove the President from office on the ground of incapacity or misbehaviour. The functions of the President may, if he is for any reason unable to act or his office is vacant, be discharged by a person nominated for the purpose by the Lord Chancellor. There shall be paid to the President such salary or fees and there may be paid to or in respect of a former President such pension, as the Treasury may with the approval of the Minister for the Civil Service determine. If a person ceases to be President of Value Added Tax Tribunals and it appears to the Treasury that there are special circumstances which make it right that he should receive compensation and the Minister for the Civil Service approves, there may be paid to that person a sum of such amount as the Treasury may, with the approval of that Minister, determine.

Such number of value added tax tribunals shall be established as the President may from time to time with the consent of the Treasury determine, and they shall sit at such times and at such places as he may from time to time determine.

A value added tax tribunal shall consist of a chairman sitting either with two other members or with one other member or alone. If the tribunal does not consist of the chairman sitting alone its decisions may be taken by a majority of votes and the chairman, if sitting with one other member, shall have a casting vote.

For each sitting of a value added tax tribunal the chairman shall be either the President or a person selected by him from a panel constituted in accordance with paragraph 7 of this Schedule ; and any other member shall be a person so selected.

There shall be a panel of chairmen and a panel of other members of value added tax tribunals for England and Wales, Scotland and Northern Ireland respectively. Each panel of chairmen shall include one or more full-time chairmen, including one to be known as Vice-President of Value Added Tax Tribunals. A member of a panel appointed as full-time chairman shall be appointed— and all other members of a panel shall be appointed by the Treasury. There shall be paid to a full-time chairman of value added tax tribunals such salary or fees, and to other members such fees, as the Treasury, with the approval of the Minister for the Civil Service, may determine ; and there may be paid to or in respect of a former full-time chairman of value added tax tribunals such pension as the Treasury may, with that approval, determine. If a person ceases to be a full-time chairman of value added tax tribunals and it appears to the Treasury that there are special circumstances which make it right that he should receive compensation and the Minister for the Civil Service approves, there may be paid to that person a sum of such amount as the Treasury may, with the approval of that Minister, determine.

In Part II of Schedule 1 to the House of Commons Disqualification Act 1957 (bodies of which all members are disqualified for membership) and in that Part as it applies by virtue of Schedule 3 to that Act in relation to the Senate and House of Commons of Northern Ireland, there shall be inserted at the appropriate place the words " A value added tax tribunal ".

No member of a value added tax tribunal shall be compelled to serve on any jury.

The Commissioners may make rules with respect to the procedure to be followed on appeals to value added tax tribunals and such rules may include provisions—

In this Schedule " authorised person " means any person acting under the authority of the Commissioners, " the Commissioners " means the Commissioners of Customs and Excise, " the tax " means car tax and " chargeable vehicle " and (in relation to vehicles) " registered " have the same meanings as in section 52 of this Act; and references to the making of a chargeable vehicle shall be construed as in that section.

The tax shall be under the care and management of the Commissioners. All money and securities for money collected or received for or on account of the tax shall— The Government of Ireland Act 1920 shall have effect as if the tax were one of the taxes mentioned in section 22(1) of that Act (reserved taxes). The Provisional Collection of Taxes Act 1968 shall be amended by inserting in subsection (1) of section 1, after the words " value added tax " the words " car tax "; and the Act as so amended shall apply in relation to a resolution of the House of Commons passed before 1st April 1974 and providing for any variation of the tax as it applies in relation to such a resolution as is mentioned in subsection (2)(a) of that section.

Subject to paragraph 6 of this Schedule, the tax on any vehicle shall be payable—

Where tax on a vehicle is payable by a person registered under this Schedule, it shall become due— and shall become payable at the time provided for by those regulations. For the purposes of this paragraph, a vehicle which is to be sold by retail by a person registered under this Schedule shall be deemed to be sent out from the premises of that person when it is sent to the place from which it is to be sold.

Where tax on a vehicle is payable as mentioned in paragraph 3(b) of this Schedule it shall become due and payable before the vehicle is registered.

Where a chargeable vehicle is made by the conversion of a vehicle which is not a chargeable vehicle and the person converting it is not registered under this Schedule, the tax on the vehicle shall become due— whichever is the earlier, and shall be payable by the person who is the owner of the vehicle at the time the tax becomes due; except that if at that time a person other than the owner is entitled to possession of the vehicle under a hire-purchase agreement the tax shall be payable by that person instead of by the owner, Where another person carries out the conversion under a contract to the order of the person by whom the tax is payable he shall be accountable for the tax as well as that person but may recover from him any tax paid in pursuance of this sub-paragraph.

Tax shall not be charged on any vehicle which is shown to the satisfaction of the Commissioners to have been exported and not to have been registered before it was exported or which is to be exported under arrangements approved by the Commissioners and is not registered.

Where it is shown to the satisfaction of the Commissioners that a person who acquires a chargeable vehicle is only temporarily in the United Kingdom or is about to become resident outside the United Kingdom the Commissioners may, subject to such conditions as they think necessary for the protection of the revenue, remit the tax on the vehicle. If tax has been remitted on a vehicle under sub-paragraph (1) of this paragraph and— and the presence of the vehicle in the United Kingdom after that date or the non-observance of that condition has not been authorised for the purposes of this sub-paragraph by the Commissioners, the tax which would have been payable but for the remission shall become payable forthwith by the person by whom the vehicle was acquired or by any other person in whose possession the vehicle is found in the United Kingdom, and shall be recoverable as a debt due to the Crown, unless, or except to the extent that, the Commissioners see fit to waive payment of the whole or part, thereof.

Regulations under this Schedule may make provision for enabling the Commissioners to remit the tax on a chargeable vehicle, subject to such conditions as they think necessary for the protection of the revenue, where the vehicle has been used and owned outside the United Kingdom for not less than such period as may be prescribed by the regulations and such other conditions are satisfied as may be so prescribed ; and the conditions that may be imposed in pursuance of the regulations may include conditions prohibiting or restricting the disposal of the vehicle for such period as may be so prescribed. If tax has been remitted on a vehicle under sub-paragraph (1) of this paragraph and any condition imposed by the Commissioners under that sub-paragraph is not complied with, the tax which would have been payable but for the remission shall be payable forthwith by the person who then owns the vehicle or by any other person in whose possession the vehicle is found, and shall be recoverable as a debt due to the Crown, unless, or except to the extent that, the Commissioners see fit to waive payment of the whole or part thereof.

Where it is shown to the satisfaction of the Commissioners that, under arrangements approved by them, an unused vehicle which was a chargeable vehicle has been converted into a vehicle which is not a chargeable vehicle, they may, subject to such conditions as they think necessary for the protection of the revenue, remit the tax on the vehicle.

For the purposes of the tax the wholesale value of any vehicle shall be taken, subject to paragraph 13(2) of this Schedule, to be the price which, in the opinion of the Commissioners, the vehicle would fetch on a sale made at the time the tax becomes due by a person selling by wholesale in the open market in the United Kingdom to a retail trader carrying on business in the United Kingdom only, on the assumption that— In this paragraph " retail trader " means a person who sells by retail and does not sell to a person who carries on a business of selling vehicles.

Where the person by whom the tax is payable is dissatisfied with the determination of the wholesale value by the Commissioners he may, within such period from the time when their decision is communicated to him as may be prescribed by regulations under this Schedule or such further time as the Commissioners may allow, by notice in writing given to the Commissioners require the determination to be referred to the arbitration of a person appointed under this paragraph, whose decision shall be final and conclusive; but no such reference shall be made unless, within that period or such further time as the Commissioners may allow, the person requiring the reference has deposited with the Commissioners the amount of tax which would be due on the basis of their determination. If the tax chargeable as a result of a reference under this paragraph is less than the amount deposited with the Commissioners the excess shall be repaid with interest at such rate as the referee may determine. A referee for the purposes of this paragraph shall be appointed by the Lord Chancellor except that—

For the purposes of the tax a vehicle which is not finished and complete but which, if finished and complete, would be a chargeable vehicle shall be treated as a chargeable vehicle. If in the opinion of the Commissioners a vehicle is not finished and complete, they shall determine its wholesale value as if it were finished and complete, having regard to the parts and accessories that remain to be provided and the processes that remain to be undergone for the vehicle to be in a state to be expected of a finished and complete chargeable vehicle.

Where it appears to the Commissioners that a person adapts or converts unused chargeable vehicles and that the vehicles as so adapted or converted remain chargeable vehicles they may direct— and where they so direct that person shall, while the direction is in force, be liable to be registered under this Schedule, whether or not he would otherwise be so liable.

A person who, in any calendar year, makes or imports not less than ten chargeable vehicles is liable to be registered by the Commissioners. Every person who, on or after 1st October 1972, is liable to be registered under this paragraph and is not for the time being so registered shall notify the Commissioners of the fact within fourteen days of that date or of becoming so liable, whichever is the later; and the Commissioners may, if they think fit, register any such person. A person for the time being registered under this paragraph who ceases to make or import chargeable vehicles shall notify the Commissioners of that fact and the Commissioners shall cancel the registration of any such person when all tax due from him has been accounted for; and they may, if they think fit, cancel the registration of any other person. The Treasury may from time to time by order made by statutory instrument substitute another number for that specified in sub-paragraph (1) of this paragraph. A statutory instrument made by virtue of this sub-paragraph shall be subject to annulment in pursuance of a resolution of the Commons House of Parliament.

The tax due from any person shall be recoverable as a debt due to the Crown. Regulations under this Schedule may make provision for authorising distress to be levied on the goods and chattels of any person refusing or neglecting to pay any tax due from him, and for the disposal of any goods or chattels on which distress is levied in pursuance of the regulations. In the application of the preceding sub-paragraph to Scotland, for the references to the levying of distress on any goods or chattels there shall be substituted references to the doing of diligence on goods and corporeal movables.

Where an amount is due from any person on account of the tax, but by reason of his failure to keep or to produce or furnish any records, accounts or other documents as required by or under this Schedule, or of his failure to take or permit to be taken any other step so required, or by reason of such records, accounts or other documents being materially incomplete or inaccurate, the Commissioners are unable to ascertain the exact amount of tax due from him, the Commissioners may assess the amount due from him to the best of their judgment and notify it to him. An assessment under this paragraph of an amount of tax due shall not be made after the later of the following:— but may, where further such evidence comes to their knowledge after the making of such an assessment, be made in addition to that assessment; but no such assessment shall be made more than six years after the time when the tax became payable, except for the purpose of recovering tax lost to the Crown through the fraud or wilful default or neglect of any person. An amount assessed and notified under this paragraph shall be recoverable as an amount of tax due unless in any action relating thereto the person liable proves the amount actually due and that amount is less than the amount assessed.

There shall be included among the debts which— the amount of any tax due at the relevant date from the bankrupt, debtor, person dying or company and having become due within twelve months next before that date. In this paragraph " the relevant date "—

A person registered under this Schedule shall— A person who, in the course of a business carried on by him, has chargeable vehicles delivered to him on which tax has not been paid shall—

Every person who is concerned (in whatever capacity) with the making, sale, importation or exportation of chargeable vehicles shall— Every person who converts a vehicle of another description into a chargeable vehicle shall inform the Commissioners of that fact forthwith unless he is a person registered under this Schedule.

An authorised person may at any reasonable time enter premises which are used in connection with the making, sale, importation or exportation of chargeable vehicles. Where an authorised person has reasonable cause to believe that any premises are used in connection with— and that chargeable vehicles are on those premises, he may at any reasonable time enter and inspect those premises and inspect and take account of any vehicles or materials found on them. If a justice of the peace is satisfied on information on oath that there is reasonable ground for suspecting that an offence in connection with the tax is being, has been, or is about to be committed on any premises, or that evidence of the commission of such an offence is to be found there, he may issue a warrant in writing authorising any authorised person to enter those premises, if necessary by force, at any time within fourteen days from the time of the issue of the warrant and search them; and any person who enters the premises under the authority of the warrant may— but no woman or girl shall be searched except by a woman. In the application of sub-paragraph (3) above to Scotland, the reference to a justice of the peace includes a reference to the sheriff and a magistrate.

If any person is knowingly concerned in, or in the taking of steps with a view to, the fraudulent evasion of the tax by him or any other person, he shall be liable to a penalty of £1,000 or three times the amount of the tax, whichever is the greater, or to imprisonment for a term not exceeding two years, or to both. If any person— he shall be liable to a penalty of £1,000 or to imprisonment for a term not exceeding two years, or to both. If any person acquires possession of, deals with or uses a chargeable vehicle having reason to believe— he shall be liable to a penalty of £1,000 or three times the amount of the tax, whichever is the greater. If a person fails to comply with any requirement imposed by or under this Schedule or regulations made under it, he shall be liable to a penalty of £100 together with a penalty of £10 for each day on which the failure continues. Sections 281 to 291 of the Customs and Excise Act 1952 (proceedings for offences, mitigation of penalties and certain other matters) shall apply in relation to offences under this paragraph (which include any act or omission in respect of which a penalty is imposed) and penalties imposed under this Schedule as they apply in relation to offences and penalties under the customs and excise Acts as defined in that Act. Section 290(2) of the Customs and Excise Act 1952 as it applies by virtue of this paragraph shall have effect as if the question mentioned in paragraph (a) thereof were the question whether or not tax on any vehicle has become due or has been paid or secured.

A chargeable vehicle shall be liable to forfeiture under the Customs and Excise Act 1952 if—

A certificate of the Commissioners— shall be sufficient evidence of the fact until the contrary is proved; and any document purporting to be such a certificate shall be deemed to be such a certificate until the contrary is proved. A photograph of any document furnished to the Commissioners for the purposes of this Schedule and certified by them to be such a photograph shall be admissible in any proceedings, whether civil or criminal, to the same extent as the document itself. Any document purporting to be a certificate under sub-paragraph (2) of this paragraph shall be deemed to be such a certificate until the contrary is proved.

A notice to be served on any person for any of the purposes of this Schedule may be served by sending it by post in a letter addressed to that person at his last or usual residence or place of business.

The Commissioners may by regulations made by statutory instrument make provision for any matter for which it appears to them necessary to make provision for the purpose of enabling them to discharge their functions in relation to the tax, and in particular, but without prejudice to the generality of this provision— Without prejudice to the generality of the preceding sub-paragraph, the regulations may make special provision with respect to certificates and other documents to be issued for the purposes of the tax before the end of March 1973. A statutory instrument made under this paragraph shall be subject to annulment in pursuance of a resolution of the Commons House of Parliament.

Regulations made under section 23 of the Vehicles (Excise) Act 1971 may enable the Secretary of State to refuse to register a vehicle unless he is satisfied, by such evidence as may be prescribed by the regulations, either—

If an Act of Tynwald makes provision similar to the provision made with respect to the car tax by this Act, Her Majesty may by Order in Council make provision for securing that— and for making such modifications in those Acts and regulations made thereunder as may be requisite for those purposes; and similarly with respect to any Act passed after this Act and relating to the car tax. An Order in Council under this paragraph may include provision for section 2 of the Isle of Man Act 1958 (Isle of Man share of certain duties) to apply as if the car tax and the tax for which provision is made by Act of Tynwald were included among the duties mentioned in subsection (4) of that section. An Order in Council under this paragraph may be varied or revoked by a subsequent Order in Council.

Interest in respect of which relief is given under section 75 of this Act shall not be allowable as a deduction for any other purpose of the Income Tax Acts.

Relief shall not be given under section 75 of this Act against income chargeable to corporation tax, and shall not be given against any other income of a company, except where both of the following conditions are satisfied, that is to say—

Where interest on any debt or liability is taken into account in the computation of profits or gains or losses for the purposes of Case I or II of Schedule D no relief shall be given under section 75 of this Act—

Where relief is given under section 75 of this Act in respect of the interest paid in any year of assessment on any debt or liability—

For the purposes of paragraphs 3 and 4 above, all interest capable of being taken into account in such a computation as is mentioned therein which is payable by any person on money advanced to him on current account, whether advanced on one or more accounts or by the same or separate banks or other persons, shall be treated as interest payable on the same debt.

References in paragraphs 3 and 4 above to relief given or an amount taken into account are references to relief given or an amount taken into account on a claim or in an assessment which has been finally determined.

A person who claims relief under section 75 of this Act in respect of any payment of interest shall furnish to the inspector a statement in writing by the person to whom the payment is made, which—

Where any such interest as is mentioned in section 75 of this Act is paid, the person to whom it is paid shall, if the person who pays it so requests in writing, furnish him with such statement as regards that interest as is mentioned in paragraph 7 above and the duty imposed by this paragraph shall be enforceable at the suit or instance of the person making the request.

Paragraphs 7 and 8 above do not apply to interest paid to a building society as defined in section 343(8) of the Taxes Act, to a company within section 343(9) of that Act, or to a local authority.

Section 75 of this Act and the amendments and repeals mentioned in subsection (8) of that section do not apply in relation to interest paid or payable before the year 1972-73.

If, by any arrangements made after 21st March 1972, any interest payable before the year 1972-73 becomes payable in or after that year or is, directly or indirectly, replaced by any interest payable in or after that year, the interest payable in pursuance of the arrangements shall be deemed for the purposes of paragraph 10 above to have been payable before that year.

Paragraphs 2 to 5 below apply where an amount is payable by instalments and, by virtue of a claim made under subsection (6) of section 80 of the Taxes Act as originally enacted, any of the instalments would have fallen to be treated as rent payable on or after 11th April 1972 or as profits or gains arising on or after that date and chargeable to tax under Case VI of Schedule D.

Where the person making the claim was a person carrying on a trade of dealing in land, and section 142(3) of the Taxes Act prevented any part of the instalment from being treated as a trading receipt, the instalment shall be treated as due on 11th April 1972 and the person who made the claim shall be chargeable to tax under Case VI of Schedule D on the amount of that instalment (reduced, where paragraph 1(2) of Schedule 4 to the Taxes Act applies, as required by that paragraph), less any loss attributable to the granting of the lease, so far as it has not been set off against or deducted from any other amount.

In any other case the person who made the claim shall, subject to paragraph 4 below, be chargeable to tax as if the instalment were pant of the consideration for a disposal to which paragraph 14 of Schedule 6 to the Finance Act 1965 as originally enacted had applied ; and section 116(3) of this Act shall apply accordingly.

A person chargeable to tax in accordance with paragraph 3 above may, by notice in writing given to the inspector not later than 11th April 1973, elect that that paragraph shall not apply in his case but that his liability to tax (including his liability for past periods) shall be computed as if both section 81(1) and section 116 of this Act had come into force before the claim under section 80(6) of the Taxes Act was made ; and where he so elects all such assessments, alterations of assessments and repayments of tax shall be made as may be necessary.

Where a person liable to pay tax in accordance with any of the preceding paragraphs satisfies the Board that he would otherwise suffer undue hardship, the tax may, at his option, be paid by such instalments as the Board may allow.

Paragraph 7 below applies with respect to a lease granted before 25th August 1971 and, so far as section 84 of the Taxes Act relates to section 80(4) of that Act, with respect to a variation or waiver the contract for which was entered into before that date.

Subsection (2) to (4) of section 81 of this Act shall apply only to the extent that they affect relief, for any year of assessment later than the year 1971-72 or for any accounting period beginning after 24th August 1971, under any of the provisions of the Taxes Act mentioned in paragraph 3(2) of Schedule 14 to that Act or under section 491(5) of that Act or to the extent that they affect the computation of the profits or gains or losses for any such year of assessment or accounting period of a trade, profession or vocation ; and paragraph 3 of Schedule 14 to the Taxes Act shall apply in relation to section 84 of that Act as amended by this Act.

A company shall for each of its accounting periods make, in accordance with this Schedule, returns to the collector of the franked payments made and franked investment income received by it in that period and of the advance corporation tax (if any) payable by it in respect of those payments. A return shall be made for— A return for any period for which a return is required to be made under this paragraph (hereinafter referred to as " a return period ") shall be made within fourteen days from the end of that period. Subject to paragraphs 4(2) and 7(3) below, no return need be made under this Schedule by a company for any period in which it has made no franked payments.

Subject to paragraph 7(2) below, the return made by a company for any return period shall show— The return shall specify whether any amount of franked payments is included under paragraph (a) of the foregoing sub-paragraph in consequence of the giving of a notice under the proviso to section 256(1) of the Taxes Act and, if so, the amount so included. For the purposes of paragraph (b) of sub-paragraph (1) above the amount of franked investment income received by a company in a return period shall be treated as including the excess, if any, of— over the amount of any franked payments made by the company in that accounting period but before the beginning of the return period. For the purposes of paragraph (c) of sub-paragraph (1) above advance corporation tax shall be payable in respect of franked payments made in a return period if the amount shown under paragraph (a) of that sub-paragraph exceeds the amount shown under paragraph (b) of that sub-paragraph or no amount is shown under the said paragraph (b); and the amount of that tax shall be calculated at the rate of advance corporation tax in force for the financial year in which the return period ends on an amount which, when that tax is added to it, is equal to that excess or, if no amount is shown under the said paragraph (b), to the amount shown under the said paragraph (a).

Subject to paragraph 7(2) below, advance corporation tax in respect of franked payments required to be included in a return under this Schedule shall be due at the time by which the return for that period is to be made, and advance corporation tax so due shall be payable without the making of any assessment. Advance corporation tax which has become due as aforesaid may be assessed on the company (whether or not it has been paid when the assessment is made) if that tax, or any part of it, is not paid on or before the due date. If it appears to the inspector that there is a franked payment which ought to have been and has not been included in a return, or if the inspector is dissatisfied with any return, he may make an assessment on the company to the best of his judgment; and any advance corporation tax due under an assessment made by virtue of this sub-paragraph shall be treated for the purposes of interest on unpaid tax as having been payable at the time when it would have been payable if a correct return had been made.

This paragraph shall have effect where— The company shall make a return under paragraph 1 above for the return period in which the franked investment income is received whether or not it has made any franked payments in that period, and, subject to sub-paragraph (3) below, shall be entitled to repayment of any advance corporation tax paid (and not repaid) in respect of franked payments made in the accounting period in question. If no franked payments were made by the company in the return period for which a return is made by virtue of sub-paragraph (2) above the amount of the repayment shall not exceed the amount of the tax credit comprised in the franked investment income received ; and in any other case the repayment shall not exceed the amount of the tax credit comprised in so much of that franked investment income, if any, as exceeds the amount of the franked payments made in that return period.

Where under paragraph 2 or 4 above franked investment income received by a company falls to be taken into account in determining— the inclusion of that franked investment income in the appropriate return shall be treated as a claim by the company to have it taken into account as aforesaid, and any such claim shall be supported by such evidence as the inspector may reasonably require.

Where a claim has been made under paragraph 5 above no proceedings for collecting tax which would fall to be discharged if the claim were allowed shall be instituted pending the final determination of the claim, but this sub-paragraph shall not affect the date when the tax is due. When the claim is finally determined any tax underpaid in consequence of sub-paragraph (1) above shall be paid. Where proceedings are instituted for collecting tax assessed, or interest on tax assessed, under any provision of this Schedule, effect shall not be given to any claim made after the institution of the proceedings so as to affect or delay the collection or recovery of the tax charged by the assessment or of interest thereon, until the claim has been finally determined. When the claim is finally determined any tax overpaid in consequence of sub-paragraph (3) above shall be repaid. References in this paragraph to proceedings for the collection of tax include references to proceedings by way of distraint or poinding for tax.

This paragraph applies to— No amount shall be shown in respect of the qualifying distribution or payment under paragraph 2(1)(a) or (c) above and paragraph 3(1) above shall not apply to the payment of advance corporation tax in respect thereof. Particulars of the qualifying distribution or payment shall be given separately in the return for the return period in which it is made and if, apart from that distribution or payment, no franked payment is made in that period, a return containing those particulars shall be made for that period under paragraph 1 above. Any advance corporation tax payable in respect of the qualifying distribution or payment shall be assessed on the company and shall be so assessed without regard to any franked investment income received by the company but—

Where any item has been included in a return under this Schedule as a franked payment made or as franked investment income received by a company but that item should have been included in a return or claim under Schedule 20 to this Act, the inspector may make any such assessments, adjustments or set-offs as may be required for securing that the resulting liabilities to tax (including interest on unpaid tax) whether of the company or of any other person are the same as they would have been if the item had been included in the right return or claim.

Where a company makes a qualifying distribution on a date which does not fall within an accounting period the company shall make a return of that distribution within fourteen days from that date, and the advance corporation tax in respect thereof shall be due at the time by which the return is to be made, except where the distribution is not a payment in which case the advance corporation tax shall be assessed on the company.

All the provisions of the Corporation Tax Acts as to the time within which an assessment may be made, so far as they refer or relate to the accounting period for which an assessment is made, or the accounting period to which an assessment relates, shall apply in relation to an assessment under this Schedule notwithstanding that, under this Schedule, the assessment may be said to relate to a quarter or other period which is not an accounting period, and the provisions of sections 36 and 39 of the Management Act as to the circumstances in which an assessment may be made out of time shall apply accordingly on the footing that any such assessment relates to the accounting period in which the quarter or other period ends or, in the case of an assessment under paragraph 9 above, to an accounting period ending on the date on which the distribution is made. Advance corporation tax assessed on a company under this Schedule shall be due within fourteen days after the issue of the notice of assessment (unless due earlier under paragraph 3(1) or 9 above). Sub-paragraph (2) above has effect subject to any appeal against the assessment, but no such appeal shall affect the date when tax is due under paragraph 3(1) or 9 above. On the determination of an appeal against an assessment under this Schedule any tax overpaid shall be repaid. Any tax assessable under any one or more of the provisions of this Schedule may be included in one assessment if the tax so included is all due on the same date.

Section 282 of the Taxes Act (which defines " close company ") shall be amended as follows. For subsection (2) (company treated as close company if more than half of apportionable income etc. could be apportioned among five or fewer participators or among participators who are directors) there shall be substituted— For subsection (4) (company not to be treated as close company if under control of any company which is not a close company) there shall be substituted—

In section 284 of the Taxes Act (matters treated as distributions in relation to close company to include certain payments etc. to participators and associates)— shall cease to have effect.

Section 286 of the Taxes Act (charge of income tax on loans and advances by close company to participators and associates) shall be amended as follows. In subsection (1) for the words from "there shall be assessed on and recoverable from the company" onwards there shall be substituted the words " there shall be assessed on and recoverable from the company, as if it were an amount of corporation tax chargeable on the company for the accounting period in which the loan or advance is made, an amount equal to such proportion of the amount of the loan or advance as corresponds to the rate of advance corporation tax in force for the financial year in which the loan or advance is made ". In subsection (3) for the words " This section shall not apply " there shall be substituted the words " Subsection (1) of this section shall not apply ". In subsection (5) for the words " paid the amount assessed on it" there shall be substituted the words " been assessed to tax " and for the words " the amount paid by the company, or a proportionate part of it, shall be repaid " there shall be substituted the words " relief shall be given from that tax, or a proportionate part of it, by discharge or repayment. " Subsection (6) shall be omitted.

Section 288 of the Taxes Act (charge of income tax on close company in respect of consideration given to participators and associates for restrictive covenants etc.) shall cease to have effect.

For subsections (2) to (4) of section 302 of the Taxes Act (definition of control) there shall be substituted—

In subsection (5) of section 303 of the Taxes Act (under which a manager is treated as a director if he satisfies the conditions specified in that subsection) paragraph (b) (which requires him to be remunerated out of the funds of the company's trade or business) shall cease to have effect.

After section 303(7) of the Taxes Act (definition of loan creditor) there shall be added—

Paragraphs 1 and 5 to 7 above, so fax as relevant for the purposes of Schedule 16 to this Act, have effect in relation to accounting periods ending after 5th April 1973 and, subject as aforesaid, this Schedule has effect from 6th April 1973.

In subsection (2) of section 305 of the Taxes Act (restriction on relief for expenses of management) the reference to income tax shall be omitted, but for the purposes of that subsection— The other reliefs mentioned in the said subsection (2) shall not include any set-off under section 85 of this Act. In applying the said subsection (2) to an accounting period in which a company carries on any business in addition to life assurance business, or carries on both ordinary life assurance business and industrial life assurance business, the tax that would have been paid if the company had been charged under Case I of Schedule D in respect of its life assurance business, or its life assurance business of either of those classes, shall be calculated as if any advance corporation tax set against the company's liability to corporation tax for that accounting period were apportioned to the corporation tax attributable to each business in proportion to the profits of that business charged to corporation tax for that accounting period.

For the purposes of subsection (2) of section 310 of the Taxes Act (rate relief from corporation tax) the reliefs to be taken into account shall not include any set-off under section 85 of this Act, and "any relief" in subsection (4)(b) of the said section 310 shall be construed accordingly. Subsection (3) of the said section 310 (rate relief from income tax where rate exceeds 37-5 per cent.) shall cease to have effect. For subsection (5) of the said section 310 there shall be substituted— For the purposes of section 85 of this Act the income charged to corporation tax for any accounting period (as defined in subsection (6) of that section) shall be reduced by an amount equal to the part specified in subsection (6) of the said section 310 of any unrelieved income (as defined in subsection (4) of that section) in respect of which a claim may be made under that section. Where sub-paragraph (3) or (4) above would deny to a company any relief to which it would have been entitled if it had been charged to tax in respect of its life assurance business under Case I of Schedule D, corresponding relief shall be afforded to the company by repayment of, or set-off against, corporation tax or by payment of tax credit comprised in franked investment income from investments held in connection with that business.

In section 313 of the Taxes Act for subsection (4) there shall be substituted—

In subsection (1) of section 314 of the Taxes Act the reference to income tax shall be omitted, but if in the case of an insurance company the income mentioned in that subsection includes a distribution in respect of which the company is entitled to a tax credit, the company may, subject to sub-paragraph (2) below, claim to have the amount of that credit paid to it. If the company mentioned in sub-paragraph (1) above is resident in the United Kingdom (so that the distribution and the tax credit there mentioned constitute franked investment income of that company) no franked investment income comprising any tax credit which is paid under that sub-paragraph shall be used under Part V of the Finance Act 1972 to frank the company's distributions; but where the company makes an election under subsection (4) of the said section 314 neither sub-paragraph (1) above nor the foregoing provisions of this sub-paragraph shall apply to the franked investment income to which the election relates. Subsection (3)(b) and (c) of the said section 314 shall cease to have effect and in subsection (4) of that section the words from " If an accounting period " to " periods, and " and the words " or part of an accounting period " shall be omitted. In section 315(8)(b) for the words "under provisions of the law of that country corresponding with section 314(1) above exemption from income tax is allowable " there shall be substituted the words " the law of that country makes provision corresponding with section 314(1) above and paragraph 4(1) and (2) of Schedule 18 to the Finance Act 1972 ".

Distributions which are not qualifying distributions shall not be taken into account— and the only distributions to be taken into account for the purposes of section 320(2) of that Act (distributions treated as franked investment income in case of overseas life insurance company exempt from charge under the said section 316) shall be distributions in respect of which the company is entitled to a tax credit. Accordingly in sections 316(2) and 318(1) for the word " distributions " there shall be substituted the words " qualifying distributions " and in section 320(2) after the word " distributions " there shall be inserted the words " (being distributions in respect of which the company receiving them is entitled to a tax credit) ".

Where an overseas life insurance company receives a distribution in respect of which it is entitled to a tax credit the company may claim to have that credit set off against any corporation tax assessed on the company under section 316 or 318 of the Taxes Act for the accounting period in which the distribution is received, but the restriction in section 319(2) and (3) of that Act on the amount of income tax that may be set off against corporation tax assessed under the said section 316 or 318 shall apply to the aggregate of that income tax and of the tax credit that can be so set off by virtue of this paragraph.

In subsection (3) of section 84 of the Finance Act 1965 for the words "the amount after deducting income tax borne by the company on franked investment income of the income tax deducted or deductible from the company's dividends " there shall be substituted the words " the amount of the advance corporation tax paid or payable in respect of the company's dividends ". In subsection (5) of that section for the words " the company by virtue of an election under section 48 of this Act pays any dividends without deduction of income tax " there shall be substituted the words " any of the dividends paid by the company are dividends to which section 84 of the Finance Act 1972 does not apply by virtue of an election under section 256 of the Income and Corporation Taxes Act 1970 " and for the words " if all the dividends so paid are paid without deduction of income tax " there shall be substituted the words " if all the dividends so paid are dividends to which the said section 84 does not so apply ". The expressions " unused credit for foreign tax " and " the current charge to corporation tax " (defined in subsection (8)(b) and (c) of the said section 84) shall be construed as if the rate of corporation tax for any relevant financial year were 40 per cent. and as if the law relating to corporation tax were the same as it was on 1st April 1972. For paragraph (d) of subsection (8) of that section there shall be substituted—.

In paragraph 3(2)(a)(ii) of Schedule 20 to the Finance Act 1965 for the words " abatement in respect of dividends paid without deduction of income tax" there shall be substituted the words " abatement in respect of dividends to which section 84 of the Finance Act 1972 does not apply ". In paragraph 3(2)(b) of that Schedule for the words " dividends without deduction of income tax" there shall be substituted the words " dividends to which the said section 84 did not apply by virtue of an election under section 256 of the Income and Corporation Taxes Act 1970 ". In paragraph 3(4) of that Schedule, in the words preceding paragraph (a), for the words " income tax deducted or deductible from dividends" there shall be substituted the words " advance corporation tax paid or payable in respect of dividends ". For paragraph 3(4)(a) of that Schedule there shall be substituted—. In paragraph 3(5) of that Schedule for the words " income tax deducted or deductible from dividends " there shall be substituted the words " advance corporation tax paid or payable in respect of dividends ". In paragraph 3(6) of that Schedule for the words " abatement in respect of dividends paid without deduction of income tax " and " in respect of dividends so paid" there shall be substituted respectively the words " abatement in respect of dividends to which section 84 of the Finance Act 1972 does not apply " and " under subsection (5) of the principal section ". In paragraph 4(1) of that Schedule for the words " the amount (before deduction of income tax) of those dividends " there shall be substituted the words " the amount of those dividends (together with such proportion thereof as corresponds to the rate of advance corporation tax applicable to them) ".

In this Schedule "relevant payment" means any payment to which section 104 of this Act applies.

A company shall for each of its accounting periods make, in accordance with this Schedule, returns to the collector of the relevant payments made by it in that period and of the income tax for which it is accountable in respect of those payments. A return shall be made for— A return for any period for which a return is required to be made under this paragraph shall be made within fourteen days from the end of that period.

The return made by a company for any period shall show—

Subject to sub-paragraph (4) below, income tax in respect of any payment required to be included in a return under this Schedule shall be due at the time by which the return is to be made, and income tax so due shall be payable by the company without the making of any assessment. Income tax which has become due as aforesaid may be assessed on the company (whether or not it has been paid when the assessment is made) if that tax, or any part of it, is not paid on or before the due date. If it appears to the inspector that there is a relevant payment which ought to have been and has not been included in a return, or if the inspector is dissatisfied with any return, he may make an assessment on the company to the best of his judgment; and any income tax due under an assessment made by virtue of this sub-paragraph shall be treated for the purposes of interest on unpaid tax as having been payable at the time when it would have been payable if a correct return had been made. Where a payment has been included in a return under Schedule 14 to this Act by virtue of paragraph 7(1)(b) of that Schedule and it becomes apparent that the payment is not a qualifying distribution but a relevant payment—

Where in any accounting period a company receives any payment on which it bears income tax by deduction the company may claim to have the income tax thereon set against any income tax which it is liable to pay under this Schedule in respect of payments made by it in that period. Any such claim shall be included in a return made under paragraph 2 above for the accounting period in question and (where necessary) income tax paid by the company under this Schedule for that accounting period and before the claim is allowed shall be repaid accordingly.

Where a claim has been made under paragraph 5 above no proceedings for collecting tax which would fall to be discharged if the claim were allowed shall be instituted pending the final determination of the claim, but this sub-paragraph shall not affect the date when the tax is due. When the claim is finally determined any tax underpaid in consequence of sub-paragraph (1) above shall be paid. Where proceedings are instituted for collecting tax assessed, or interest on tax assessed, under any provision of paragraph 4 above, effect shall not be given to any claim made after the institution of the proceedings so as to affect or delay the collection or recovery of the tax charged by the assessment or of interest thereon, until the claim has been finally determined. When the claim is finally determined any tax overpaid in consequence of sub-paragraph (3) above shall be repaid. References in this paragraph to proceedings for the collection of tax include references to proceedings by way of distraint or poinding for tax.

Income tax set against other tax under paragraph 5 above shall be treated as paid or repaid, as the case may be, and the same tax shall not be taken into account both under this Schedule and under section 240(5) of the Taxes Act.

Where any item has been included in a return or claim under this Schedule as a relevant payment but should have been included in a return under Schedule 14 to this Act, the inspector may make such assessments, adjustments or set-offs as may be required for securing that the resulting liabilities to tax (including interest on unpaid tax) whether of the company or of any other person are the same as they would have been if the item had been included in the right return.

Where a company makes a relevant payment on a date which does not fall within an accounting period the company shah make a return of that payment within fourteen days from that date, and the income tax for which the company is accountable in respect of that payment shall be due at the time by which the return is to be made.

All the provisions of the Income Tax Acts as to the time within which an assessment may be made, so far as they refer or relate to the year of assessment for which an assessment is made, or the year to which an assessment relates, shall apply in relation to any assessment under this Schedule notwithstanding that, under this Schedule, the assessment may be said to relate to a quarter or other period which is not a year of assessment, and the provisions of sections 36 and 37 of the Management Act as to the circumstances in which an assessment may be made out of time shall apply accordingly on the footing that any such assessment relates to the year of assessment in which the quarter or other period ends. Income tax assessed on a company under this Schedule shall be due within fourteen days after the issue of the notice of assessment (unless due earlier under paragraph 4(1) or 9 above). Sub-paragraph (2) above has effect subject to any appeal against the assessment, but no such appeal shall affect the date when tax is due under paragraph 4(1) or 9 above. On the determination of an appeal against an assessment under this Schedule any tax overpaid shall be repaid. Any tax assessable under any one or more of the provisions of this Schedule may be included in one assessment if the tax so included is all due on the same date.

Nothing in the foregoing provisions of this Schedule shall be taken to prejudice any powers conferred by the Income Tax Acts for the recovery of income tax by means of an assessment or otherwise ; and any assessment in respect of tax payable under paragraph 9 above shall be treated for the purposes of the provisions mentioned in paragraph 10(1) above as relating to the year of assessment in which the payment is made.

In paragraph (b) of subsection (2) of section 233 of the Taxes Act (distributions out of company's assets otherwise than for new consideration) for the words "new consideration given for the distribution " there shall be substituted the words " new consideration received by the company for the distribution ".

Paragraph (c) of the said subsection (2) (redeemable share capital or security issued by company in respect of shares otherwise than for new consideration) shall apply also to any such capital or security issued after 5th April 1972 as is mentioned in that paragraph but in respect of securities and not shares, and accordingly for that paragraph there shall be substituted— and paragraph (d)(i) of that subsection (interest on securities mentioned in the said paragraph (c)) shall have effect accordingly. For the purposes of the said paragraph (c)— and in determining the amount of the distribution constituted by the issue of any redeemable share capital or any security, the capital or security shall be taken at that value.

Sub-paragraph (ii) of paragraph (d) of the said subsection (2) (securities convertible directly or indirectly into shares, being securities which are not quoted or comparable to any which are quoted) shall apply also to securities issued after 5th April 1972 which are not quoted or comparable as aforesaid and carry any right to receive shares in or securities of the company, and accordingly for that sub-paragraph there shall be substituted—. In the case of any interest or other distribution to which the said paragraph (d) applies by virtue of so much of sub-paragraph (iii) thereof as relates to securities under which the consideration represents more than a reasonable commercial return for the use of the principal secured, that paragraph shall not operate so as to treat as a distribution so much of the interest or other distribution as represents a reasonable commercial return for the use of that principal. No amount shall be regarded for the purposes of the said paragraph (d) as representing the principal secured by a security issued after 5th April 1972 in so far as it exceeds any new consideration which has been received by the company for the issue of the security. This sub-paragraph is without prejudice to section 237(6) of the Taxes Act (calculation of principal secured where securities are issued at a price less than the amount repayable on them).

No transfer of assets (other than cash) or of liabilities between one company and another shall constitute, or be treated as giving rise to, a distribution by virtue of subsection (2)(b) or (3) of the said section 233 if they are companies— For the purposes of this paragraph two companies are under common control if they are under the control of the same person or persons, and for this purpose " control" shall be construed in accordance with section 302 of the Taxes Act. Any amount which would be a distribution by virtue of subsection (3) of the said section 233 apart from the proviso to that subsection (groups of companies resident in the United Kingdom), shall not constitute a distribution by virtue of subsection (2)(b) of that section.

Section 234 of the Taxes Act (which treats a bonus issue of share capital other than redeemable share capital as a distribution if it is made at the same time as or after a repayment of share capital) shall apply whether or not the bonus issue is of redeemable share capital, and accordingly in subsection (1)(b) of that section the words " not being redeemable share capital" shall be omitted. Except in relation to a company within paragraph D of section 461 of the Taxes Act (closely controlled companies), the said section 234 shall not apply if the issue of share capital mentioned in paragraph (b) of subsection (1) of that section— This paragraph applies where the issue of share capital mentioned in section 234(1)(b) takes place on or after the 6th April 1973 ; and sub-paragraph (2) above applies whether the repayment of share capital there mentioned takes place before, on or after that date.

Subsection (1) of section 235 of the Taxes Act (under which a distribution cannot be treated as a repayment of share capital if it follows a bonus issue which does not itself fall to be treated as a distribution) shall apply where the bonus issue falls to be treated as a distribution other than a qualifying distribution, and accordingly in that subsection for the words " treated as a distribution" and " treated as distributions" there shall be substituted the words " treated as a qualifying distribution " and " treated as qualifying distributions " respectively. Except in relation to a company within paragraph D of section 461 of the Taxes Act, subsection (1) of the said section 235 shall not prevent a distribution being treated as a repayment of share capital if it is made— Sub-paragraph (1) above applies where the issue of share capital mentioned in section 235(1)(a) takes place on or after 6th April 1973 ; and sub-paragraph (2) above applies whether it takes place before, on or after that date.

Section 236 of the Taxes Act (which treats as a distribution any share capital taken in lieu of a cash dividend) shall cease to have effect.

No consideration derived from the value of any share capital or security of a company, or from voting or other rights in a company, shall be regarded for the purposes of Part X of the Taxes Act or this Schedule as new consideration received by the company unless the consideration consists of— No amount shall be regarded as new consideration by virtue of sub-paragraph (1)(b) or (c) above in so far as it exceeds any new consideration received by the company for the issue of the share capital or security in question or, in the case of share capital which constituted a qualifying distribution on issue, the nominal value of that share capital.

Where two or more companies enter into arrangements to make distributions to each other's members, all parties concerned may for the purposes of Part X of the Taxes Act and this Schedule be treated as if anything done by either of those companies had been done by the other. This paragraph applies however many companies participate in the arrangements.

In Part X of the Taxes Act and this Schedule the expressions " in respect of shares in a company " and " in respect of securities of a company " in relation to a company which is a member of a 90 per cent. group, mean respectively in respect of shares in that company or any other company in the group and in respect of securities of that company or any other company in the group. Without prejudice to section 233(2)(b) of that Act as extended by the foregoing sub-paragraph, in relation to a company which is a member of a 90 per cent. group, " distribution" includes anything distributed out of assets of the company (whether in cash or otherwise) in respect of shares in or securities of another company in the group. Nothing in this paragraph shall require a company to be treated as making a distribution to any other company which is in the same group and is resident in the United Kingdom. For the purposes of this paragraph a principal company and all its 90 per cent. subsidiaries form a "90 per cent. group" and " principal company" means a company of which another company is a subsidiary.

Paragraphs 5, 6 and 7 above have effect from 6th April 1973 and the other paragraphs of this Schedule from 6th April 1972. This Schedule shall be construed as if it were included in Part X of the Taxes Act

In section 34(6) of the Finance Act 1965, in the definition of " trading company " for the words " section 292(1) of the Income and Corporation Taxes Act 1970" there shall be substituted the words " paragraph 11 of Schedule 16 to the Finance Act 1972 ".

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

In paragraph 18(1) of Schedule 6 to the said Act of 1965 for the words from " section 297 " to " 1970 " there shall be substituted the words " paragraph 5 of Schedule 16 to the Finance Act 1972 (consequences for income tax of apportionment of income etc. of close company) "; in paragraph 18(2) of that Schedule for the words " subsection (8) of the said section 297 " and " subsection (2)(b) of that section" there shall be substituted respectively the words " sub-paragraph (6) of the said paragraph 5 " and " sub-paragraph (2)(b) of that paragraph " ; and in paragraph 18(5) of that Schedule for the words " the said section 297 " there shall be substituted the words " the said paragraph 5 ".

In section 5 of the Provisional Collection of Taxes Act 1968 in subsection (1)(c) after the words “section 243(6) of the Income and Corporation Taxes Act 1970” there shall be inserted the words “or advance corporation tax could be payable or assessed by virtue of section 103(2) of the Finance Act 1972”, and in subsection (2) of that section after the word “Act)” there shall be inserted the words “and the said section 103(2) of the Finance Act 1972”.

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

In section 11 of the Management Act, after subsection (5) there shall be added—

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

In section 31(3)(b) of the Management Act the figure “297” (inserted by the Finance Act 1971) shall be omitted and at the end there shall be inserted “or under paragraph 5 of Schedule 16 to the Finance Act 1972”.

In section 55(1)(e) of the Management Act for the words " Schedule 9 to the principal Act (income tax on company distributions etc.)" there shall be substituted the words " Schedule 20 to the Finance Act 1972 (income tax on company payments other than distributions) ".

. . .

In section 86(1)(d) of the Management Act after the words " corporation tax " there shall be inserted the words " other than advance corporation tax ".

For section 87 of the Management Act there shall be substituted—

In section 88(2) of the Management Act, for the words “Schedule 9 to the principal Act” there shall be substituted the words “Schedule 14 or 20 to the Finance Act 1972.”

Paragraph 19 of Schedule 16 and paragraphs 2(b), 3 and 4 of Schedule 21 to the Finance Act 1972 and the following shall be added in the second column— Schedules 14 and 20, and paragraphs 1 and 2(a) of Schedule 21, to the Finance Act 1972

For section 109 of the Management Act there shall be substituted—

In Schedule 3 to the Management Act, in column 1 of rule 8 the words “288 or 289” shall be omitted and at the end there shall be inserted the words “or relating to a notice under paragraph 15 of Schedule 16 to the Finance Act 1972”.

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

In section 4(3) of the Taxes Act (as substituted by the Finance Act 1971) after the words " or is treated as having been deducted " there shall be inserted the words " or income chargeable under Schedule F ".

In section 53(4) of the Taxes Act for the words " Schedule 9 to this Act" there shall be substituted the words " Schedule 20 to the Finance Act 1972 ".

In section 226(9) of the Taxes Act for the words " section 292(1) of this Act" there shall be substituted the words " paragraph 11 of Schedule 16 to the Finance Act 1972 ".

For section 232(4) of the Taxes Act there shall be substituted—

In section 242(1) of the Taxes Act for paragraphs (a) to (c) there shall be substituted—

In section 248 of the Taxes Act, in subsection (4)(a) for the words " Schedule 9 to this Act" there shall be substituted the words " Schedule 20 to the Finance Act 1972 ", and in subsection (8) for the words " by reason of section 284(1)(a) or any other provision " there shall be substituted the words " by reason of any provision ".

Provided that this subsection shall not by virtue of section 94(3) of the Finance Act 1972 apply to paragraph 9 of Schedule 16 to that Act

In section 343 of the Taxes Act, in subsection (2)(b), for the words " Schedule 9 to this Act" there shall be substituted the words " Schedule 20 to the Finance Act 1972 " and in subsection (7) for the word " distribution " there shall be substituted the words " qualifying distribution ".

In section 393(1) of the Taxes Act for the words " tax under section 289 of this Act (shortfall in distributions of close company)" there shall be substituted the words " tax under Schedule 16 to the Finance Act 1972 (apportionment of income of close companies) ".

In section 399(1)(b) of the Taxes Act for the words from " then " onwards there shall be substituted the words then, for the purposes of Schedule 16 to the Finance Act 1972—.

In section 432(7) of the Taxes Act the words " section 297(3) (close companies: apportionments)" shall be omitted and there shall be added at the end the words " and paragraph 5(3) of Schedule 16 to the Finance Act 1972 (close companies: apportionments) ".

Where the income of a body corporate has been, or could have been, apportioned under Schedule 16 to the Finance Act 1972 any amount of that income which by virtue of paragraph (b) above is to be included in the income arising under a settlement shall be increased by such proportion thereof as corresponds to the rate of advance corporation tax applicable to a distribution made at the end of the accounting period to which the apportionment relates.

In section 478(8)(d) of the Taxes Act for the words " section 296 of this Act" there shall be substituted the words " paragraph 1 of Schedule 16 to the Finance Act 1972 " and at the end there shall be inserted the words " and that amount shall be treated as increased by such proportion thereof as corresponds to the rate of advance corporation tax applicable to a distribution made at the end of the accounting period to which the apportionment relates ".

In section 481(3) of the Taxes Act for the words " section 292(1) of this Act" there shall be substituted the words " paragraph 11 of Schedule 16 to the Finance Act 1972 ".

In section 521 of the Taxes Act subsection (3)(a) shall be omitted, and at the end there shall be added—

In section 522 of the Taxes Act for the words " interest on any of its securities, or under section 232(3) of this Act from payments of preference dividends on any of its shares " there shall be substituted the words " interest (not being a distribution) on any of its securities " and the words " or share " (three times) and the words " In this section ' share' includes stock " shall be omitted.

and after the definition of " preference dividend " there shall be inserted— .

In section 528(3)(a) of the Taxes Act after the words " for any year " there shall be inserted the words " or which for the purposes of Schedule F comprises an amount equal to a tax credit calculated by reference to the rate of advance corporation tax in force for any year ".

In Schedule 14 to the Taxes Act, in paragraph 15, for the words " Board may exercise under section 301 of this Act for the purposes of sections 296 to 300 " there shall be substituted the words " inspector may exercise under paragraph 19 of Schedule 16 to the Finance Act 1972 for the purposes of that Schedule ".