Taxes Management Act 1970

17 Interest paid or credited by banks, etc. without deduction of income tax. [1952 s.29.] U.K.

(1) Every person carrying on a trade or business who, in the ordinary course of the operations thereof, receives or retains money in such circumstances that interest becomes payable thereon which is paid or credited without deduction of income tax F1 , and, in particular, every person carrying on the trade or business of banking, shall, if required to do so by notice from an inspector, make and deliver to the inspector, within the time specified in the notice, a return of all interest paid or credited by him as aforesaid during a year[of assessment F2 ] specified in the notice in the course of his trade or business or any such part of his trade or business as may be so specified, giving the names and addresses of the persons to whom the interest was paid or credited and stating, in each case, the amount of the interest F1 :

Provided that—

(a) no interest paid or credited to any person shall be required to be included in any such return if the total amount of the interest paid or credited to that person which would otherwise have fallen to be included in the return does not exceed £15, and F3

(b) the year specified in a notice under this subsection shall not be a year ending more than three years before the date of the service of the notice F4 F5 .

(2) Without prejudice to the generality of so much of subsection (1) above as enables different notices to be served thereunder in relation to different parts of a trade or business, separate notices may be served under that subsection as respects the transactions carried on at any branch or branches respectively specified in the notices, and any such separate notice shall, if served on the manager or other person in charge of the branch or branches in question, be deemed to have been duly served on the person carrying on the trade or business; and where such a separate notice is so served as respects the transactions carried on at any branch or branches, any notice subsequently served under the said subsection (1) on the person carrying on the trade or business shall not be deemed to extend to any transaction to which the said separate notice extends.

(3) This section shall, with any necessary adaptations, apply in relation to the National Savings Bank as if it were a trade or business carried on by the Director of Savings F4 .

(4) This section shall apply only to money received or retained in the United Kingdom, and if a person to whom any interest is paid or credited in respect of any money received or retained in the United Kingdom by notice in writing served on the person paying or crediting the interest—

(a) declares that the person who was beneficially entitled to that interest when it was paid or credited was not then ordinarily resident in the United Kingdom, and

(b) requests that the interest shall not be included in any return under this section,

the person paying or crediting the interest shall not be required to include that interest in such return.

[(5) The Board may by regulations provide as mentioned in all or any of the following paragraphs—

(a) that a return under subsection (1) above shall contain such further information as is prescribed if the notice requiring the return specifies the information and requires it to be contained in the return;

(b) that a person required to make and deliver a return under subsection (1) above shall furnish with the return such further information as is prescribed if the notice requiring the return specifies the information and requires it to be so furnished;

(c) that if a person is required to furnish information under any provision made under paragraph (b) above, and the notice requiring the return specifies the form in which the information is to be furnished, the person shall furnish the information in that form;

(d) that a notice under subsection (1) above shall not require prescribed information;

and in this subsection “prescribed” means prescribed by the regulations.

(6) Regulations under subsection (5) above—

(a) shall be made by statutory instrument subject to annulment in pursuance of a resolution of the House of Commons,

(b) may make different provision in relation to different cases or descriptions of case, and

(c) may include such supplementary, incidental, consequential or transitional provisions as appear to the Board to be necessary or expedient F6 .] F7

Textual Amendments

F1 See Finance Act 1990 s. 92(2)(a)(b)—insertion of words

“or after deduction of income tax”

and

“actually paid or credited and (where the interest was paid or credited after deduction of income tax) the amount of the interest from which the tax was deducted and the amount of the tax deducted”

respectively where interest is paid or credited in the year 1991-92or in a subsequent year of assessment.

F2 Finance Act 1988 (c. 39, SIF 63:1,2) s. 123(2)with respect to notices given on or after 29July 1988.

F3 See Finance Act 1990 ss. 92(2)(c)and 132and Sch. 19 Part V—para. (a)omitted where interest is paid or credited in the year 1991-92or a subsequent year of assessment.

F4 See—Taxes Management Act 1970 (c. 9, SIF 63:1) s.119andSch.4 para.2—references ins.17(1)to interest paid or credited by theDirector of Savingsto include references to interest paid or credited before1October1969by thePostmaster Generalto depositors.National Savings Bank Act 1971 (c.29) s.12(3)—s.12(1)of that Act (secrecy)to have effect subject toTaxes Management Act 1970 (c. 9, SIF 63:1) s.17(3).

F5 S.I. 1986 No. 482 (in Part III Vol. 5) regn. 10—s. 17to apply to a building society as if references to interest include references to dividends within the meaning of S.I. 1986 No. 482and with the insertion of the words

“or of a building society”

after the words

“trade or business of banking”

in subs. (1).

F6 Finance Act 1990 s. 92(3), (7)—subss. (5)and (6)have effect where interest is paid or credited in the year 1991-92or a subsequent year of assessment.

F7 See S.I. 1990 No. 2231coming into force 30November 1990for 1991-91and subsequent years.