Section 23.
SCHEDULE 3U.K. Insurance companies and friendly societies
Section 76 of the Taxes Act 1988U.K.
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Section 432E of the Taxes Act 1988U.K.
2(1)In section 432E of the Taxes Act 1988 (section 432B apportionment: participating funds) paragraph (b) of subsection (6) (which provides for the adjustment of the net amount referable to overseas life assurance business) shall cease to have effect.U.K.
(2)This paragraph has effect in relation to distributions made on or after 2nd July 1997.
Section 434 of the Taxes Act 1988U.K.
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Section 434A of the Taxes Act 1988U.K.
4(1)In section 434A of the Taxes Act 1988 (computation of losses and limitation on relief) subsection (1) (which falls as a result of new section 434(1) to (1B)) shall cease to have effect.U.K.
(2)This paragraph has effect for accounting periods beginning on or after 2nd July 1997.
Prospective
Section 436 of the Taxes Act 1988U.K.
5(1)In section 436 of the Taxes Act 1988 (pension business: separate charge on profits) in subsection (3), paragraphs (d) and (e) (which make provision, for the purposes of the computation of profits arising from pension business, for group income and non-qualifying distributions to be left out of account) shall cease to have effect.U.K.
(2)This paragraph has effect in relation to distributions made on or after 2nd July 1997.
Section 438 of the Taxes Act 1988U.K.
6(1)Section 438 of the Taxes Act 1988 (pension business: exemption from tax) shall be amended as follows.U.K.
(2)Subsections (3) and (3AA) (which fall as a result of new section 434(1) to (1B)) shall cease to have effect.
(3). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(4)Subsection (5) (which falls with the substitution of subsection (4)) shall cease to have effect.
(5)Subsections (6) to (7) (which fall with the repeal of subsections (3), (3AA) and (5) and the substitution of subsection (4)) shall cease to have effect.
(6)Subsection (9) (which falls with the repeal of subsections (6), (6B) and (6E) and the repeal of section 440B(2)) shall cease to have effect.
(7)Sub-paragraphs (2) to (4) above have effect in relation to distributions made on or after 2nd July 1997.
(8)Sub-paragraphs (5) and (6) above have effect for accounting periods beginning on or after 2nd July 1997.
(9)In determining, for the purposes of subsections (6) to (7) of section 438 of the Taxes Act 1988, the franked investment income of, or foreign income dividends arising to, an insurance company for an accounting period beginning before 2nd July 1997 and ending on or after that date, there shall be left out of account any distributions which are made on or after 2nd July 1997.
Section 439B of the Taxes Act 1988U.K.
7(1)In section 439B of the Taxes Act 1988 (life reinsurance business: separate charge on profits) subsection (7) (which falls as a result of new section 434(1) to (1B)) shall cease to have effect.U.K.
(2)This paragraph has effect in relation to distributions made on or after 2nd July 1997.
Section 440B of the Taxes Act 1988U.K.
8(1)Section 440B of the Taxes Act 1988 (modifications where tax charged under Case I of Schedule D) shall be amended as follows.U.K.
(2)Subsection (1A) (which falls as a result of new section 434(1) to (1B)) shall cease to have effect.
(3)Subsection (2) (which falls with the repeal of section 438(6), (6B) and (6E)) shall cease to have effect.
(4)Sub-paragraph (2) above has effect in relation to distributions made on or after 2nd July 1997.
(5)Sub-paragraph (3) above has effect for accounting periods beginning on or after 2nd July 1997.
Prospective
Section 441A of the Taxes Act 1988U.K.
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Schedule 19AB to the Taxes Act 1988U.K.
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Schedule 19AC to the Taxes Act 1988U.K.
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Section 89 of the Finance Act 1989U.K.
14(1)Section 89 of the Finance Act 1989 (policy holders’ share of profits) shall be amended as follows.U.K.
(2)In subsection (2)—
(a)paragraph (a) (which provides for Case I profits to be reduced by unrelieved franked investment income in respect of which an election under section 438(6) has been made) shall cease to have effect;
(b)in paragraph (b) (which provides for Case I profits to be reduced by the shareholders’ share of any other unrelieved franked investment income from investments held in connection with life assurance business)—
(i)the words “other unrelieved” shall cease to have effect; and
(ii)for “from investments held in connection with the company’s life assurance business” there shall be substituted “ which is referable to the company’s basic life assurance and general annuity business ”; and
(c)in paragraph (c) (which provides for Case I profits to be reduced by the shareholders’ share of foreign income dividends in respect of such investments) for “in respect of investments held in connection with the company’s life assurance business” there shall be substituted “ which are referable to the company’s basic life assurance and general annuity business ”.
(3)Subsection (8) (meaning of “unrelieved” franked investment income) shall cease to have effect.
(4)This paragraph has effect in relation to distributions made on or after 2nd July 1997.
Section 65 of the Finance (No.2) Act 1992U.K.
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