Income and Corporation Taxes Act 1988

[F1 440A Securities. U.K.

(1) Subsection (2) below applies where the assets of an insurance company include securities of a class all of which would apart from this section be regarded for the purposes of corporation tax on chargeable gains as one holding.

(2) Where this subsection applies—

[F2 (a) so many of the securities as are identified in the company’s records as securities by reference to the value of which there are to be determined benefits provided for under policies or contracts the effecting of all (or all but an insignificant proportion) of which constitutes the carrying on of—

[F3 (i) basic life assurance and general annuity business, or

(ii) gross roll-up business,]

shall be treated for the purposes of corporation tax as a separate holding linked solely to that business,]

(c) F4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(d) so many of the securities as are included in the company’s [F5 long-term insurance fund] but do not fall within [F6 paragraph (a)] shall be treated for those purposes as a separate holding which is an asset of that fund (but not of [F7 the description mentioned in that paragraph]), and

(e) any remaining securities shall be treated for those purposes as a separate holding which is not of any of the descriptions mentioned in the preceding paragraphs.

(3) Subsection (2) above also applies where the assets of an insurance company include securities of a class and apart from this section some of them would be regarded as a 1982 holding, and the rest as a [F8 section 104 holding], for the purposes of corporation tax on chargeable gains.

(4) In a case within subsection (3) above—

(a) the reference in any paragraph of subsection (2) above to a separate holding shall be construed, where necessary, as a reference to a separate 1982 holding and a separate [F8 section 104 holding], and

(b) the questions whether such a construction is necessary in the case of any paragraph and, if it is, how many securities falling within the paragraph constitute each of the two holdings shall be determined in accordance with paragraph 12 of Schedule 6 to the Finance Act 1990 and the identification rules applying on any subsequent acquisitions and disposals.

(5) Section [F9 105 of the 1992 Act]] shall have effect where subsection (2) above applies as if securities regarded as included in different holdings by virtue of that subsection were securities of different kinds.

[F10 F11 (6) In this section—

• “1982 holding” has the same meaning as in section 109 of the 1992 Act;

• “ [F8 section 104 holding]” has the same meaning as in section 104(3) of that Act; and

• “securities” means shares, or securities of a company, and any other assets where they are of a nature to be dealt in without identifying the particular assets disposed or acquired.]

[F10 (7) In a case where the profits of a company’s life assurance business are charged to tax [F12 under section 35 of CTA 2009 (charge on trade profits)] this section has effect with the modification specified in section 440B(4).]

Textual Amendments

F1 Ss. 440, 440A substituted for s. 440 (1.1.1990) by Finance Act 1990 (c. 29), Sch. 6 paras. 8, 11(2) (with Sch. 6 para. 12)

F2 S. 440A(2)(a) substituted for s. 440A(2)(a)(b) (with effect in accordance with Sch. 8 para. 57(1) of the amending Act) by Finance Act 1995 (c. 4), Sch. 8 para. 6 (with Sch. 8 para. 55(2))

F3 S. 440A(2)(a)(i)(ii) substituted for s. 440A(2)(a)(i)-(iii) (with effect in accordance with s. 38(2) of the amending Act) by Finance Act 2007 (c. 11), Sch. 7 para. 32(a) (with Sch. 7 Pt. 2)

F4 S. 440A(2)(c) repealed (with effect in accordance with s. 38(2) of the repealing Act) by Finance Act 2007 (c. 11), Sch. 7 para. 32(b), Sch. 27 Pt. 2(7), Note (with Sch. 7 Pt. 2)

F5 Words in s. 440A(2)(d) substituted (1.12.2001 with effect in accordance with art. 1(2)(a) of the amending S.I.) by The Financial Services and Markets Act 2000 (Consequential Amendments) (Taxes) Order 2001 (S.I. 2001/3629), art. 52(1)(h)

F6 Words in s. 440A(2)(d) substituted (with effect in accordance with s. 38(2) of the amending Act) by Finance Act 2007 (c. 11), Sch. 7 para. 32(c)(i) (with Sch. 7 Pt. 2)

F7 Words in s. 440A(2)(d) substituted (with effect in accordance with s. 38(2) of the amending Act) by Finance Act 2007 (c. 11), Sch. 7 para. 32(c)(ii) (with Sch. 7 Pt. 2)

F8 Words in s. 440A(3)(4)(6) substituted (with effect in accordance with s. 123(6) of the amending Act) by Finance Act 1998 (c. 36), s. 123(5)(a)

F9 Words in s. 440A(5) substituted (6.3.1992 with effect as mentioned in s. 289(1)(2) of the amending Act) by Taxation of Chargeable Gains Act 1992 (c. 12), ss. 289, 290(1), Sch. 10 para. 14(23)(a) (with ss. 60, 101(1), 171, 201(3))

F10 S. 440A(7) inserted (with effect in accordance with Sch. 8 para. 57(1) of the amending Act) by Finance Act 1995 (c. 4), Sch. 8 para. 28(4) (with Sch. 8 para. 55(2))

F11 S. 440A(6) substituted (6.3.1992 with effect as mentioned in s. 289(1)(2) of the amending Act) by Taxation of Chargeable Gains Act 1992 (c. 12), ss. 289, 290(1), Sch. 10 para. 14(23)(b) (with ss. 60, 101(1), 171, 201(3))

F12 Words in s. 440A(7) substituted (1.4.2009 with effect in accordance with s. 1329(1) of the amending Act) by Corporation Tax Act 2009 (c. 4), Sch. 1 para. 137 (with Sch. 2 Pts. 1, 2)

Modifications etc. (not altering text)

C1 S. 440A(2) modified (31.7.1992 with effect in accordance with reg. 1 of the modifying S.I.) by The Friendly Societies (Modification of the Corporation Tax Acts) Regulations 1992 (S.I. 1992/1655), regs. 1, 14, 15 (as amended (31.12.1993 with effect in accordance with reg. 1(2)(3) of the amending S.I.) by The Friendly Societies (Modification of the Corporation Tax Acts) (Amendment) Regulations 1993 (S.I. 1993/3111), regs. 1(1), 5)

C2 S. 440A(2) modified (31.7.1992 with effect in accordance with reg. 1 of the modifying S.I.) by The Friendly Societies (Modification of the Corporation Tax Acts) Regulations 1992 (S.I. 1992/1655), regs. 1, 16 (as substituted (31.12.1993 with effect in accordance with reg. 1(2)(3) of the amending S.I.) by The Friendly Societies (Modification of the Corporation Tax Acts) (Amendment) Regulations 1993 (S.I. 1993/3111), regs. 1(1), 10)

C3 S. 440A(2) modified (20.3.1997 with effect in accordance with reg. 1(2) of the modifying S.I.) by The Friendly Societies (Modification of the Corporation Tax Acts) Regulations 1997 (S.I. 1997/473), regs. 1(1), 26, 27; and that modifying reg. 27 is omitted (8.4.2004 with effect in accordance with reg. 1 of the revoking S.I.) by virtue of S.I. 2004/822, reg. 21

C4 S. 440A(2) modified (12.8.2005 with effect in accordance with reg. 1(2) of the modifying S.I.) by The Friendly Societies (Modification of the Corporation Tax Acts) Regulations 2005 (S.I. 2005/2014), regs. 1(1), 17 (as amended by S.I. 2007/2134, regs. 1(1)(2), 17)

C5 See 1990 s.41and Sch.6 para.12(2)—subs.(d)omitted for period 1January 1990to 19March 1990inclusive.

C6 See 1990 s.41and Sch.6 para.12(1), (3), (4), (6), (7)and (10)—application and commencement provisions for

“1982 holdings”

and

“new holdings”.

C7 See 1990 s.41and Sch.6 para.12(1), (3), (4), (6), (7)and (10)—application and commencement provisions for

“1982 holdings”

and

“new holdings”.

C8 S. 440A(2)(e) modified by Finance Act 1989 (c. 26), s. 83XA(13) (as inserted (with effect in accordance with Sch. 10 para. 17(2) of the amending Act) by Finance Act 2007 (c. 11), Sch. 10 para. 2(1))