Finance Act 1989

13 (1) Subject to sub-paragraph (3) below, the amendments made by paragraphs 1and 2 of this Schedule shall not have effect in relation to a grant,assignment or other supply where—

(a) it is made in pursuance of a legally binding obligation to make it whichwas incurred before 21st June 1988, and

(b) if the Commissioners so require (whether before or after it is made), itis proved to their satisfaction by the production of documents made beforethat date that it is so made.

(2) Subject to sub-paragraph (3) below, the amendments made by paragraphs 1and 2 of this Schedule shall not have effect in relation to a grant orassignment of an interest in, or in any part of, a building or its sitewhere—

(a) the grant or assignment takes place before 21st June 1993,

(b) the person making the grant or assignment was under a legally bindingobligation incurred before 21st June 1988 to construct (or reconstruct) thebuilding or to construct any development of which it forms part (other thanan obligation to receive services or goods in the course of the constructionor reconstruction),

(c) if the Commissioners so require (whether before or after the grant orassignment is made), it is proved to their satisfaction by the production ofdocuments made before that date that he was under that obligation, and

(d) planning permission for the construction (or reconstruction) of thebuilding was granted before 21st June 1988.

(3) Where the grant or assignment is of a tenancy or lease—

(a) if a premium is payable, sub-paragraph (1) or (2) above shall apply onlyto the extent that it is made for consideration in the form of the premium;and

(b) if a premium is not payable, sub-paragraph (1) or (2) above shall applyonly to the extent that it is made for consideration in the form of the firstpayment of rent due under the tenancy or lease.

(4) The amendments made by paragraphs 1 and 2 of this Schedule shall not haveeffect in relation to a supply relating to a building or civil engineeringwork where—

(a) the supply takes place before 21st June 1993,

(b) the supply is made to the person constructing the building or work (orreconstructing the building),

(c) that person was under a legally binding obligation incurred before21st June 1988 to construct the building or work (or to reconstruct thebuilding) or to construct any development of which it forms part (other thanan obligation to receive services or goods in the course of the constructionor reconstruction),

(d) if the Commissioners so require (whether before or after the supply ismade), it is proved to their satisfaction by the production of documents madebefore that date that he was under that obligation,

(e) planning permission for the construction of the building or work (or thereconstruction of the building) was granted before 21st June 1988, and

(f) before the supply takes place the person constructing the building or work(or reconstructing the building) has given to the person making the supply acertificate in such form as may be specified in a notice published by theCommissioners stating that the supply is zero-rated (in whole or to the extentspecified in the certificate) by virtue of this sub-paragraph.

(5) Where a grant, assignment or other supply is zero-rated by virtue of thisparagraph, it is not a relevant zero-rated supply for the purposes ofparagraph 1 of Schedule 6A to the M1 Value Added Tax Act1983.

(6) Nothing in paragraphs 5 and 6 of that Schedule shall apply—

(a) in relation to a person who has constructed a building if he incurredbefore 21st June 1988 a legally binding obligation to make a grant orassignment of a major interest in, or in any part of, the building or itssite;

(b) in relation to a building or work if there was incurred before that datea legally binding obligation to make in relation to the building or work asupply within item 2 of Group 8 of Schedule 5 to the Value Added Tax Act 1983;

(c) in relation to a person who has constructed a building if—

(i) he incurred before that date a legally binding obligation to construct thebuilding or any development of which it forms part, and

(ii) planning permission for the construction of the building was grantedbefore that date,

except where that person does not make a grant or assignment of a majorinterest in, or in any part of, the building or its site before 21st June1993.

(7) If the Commissioners so require, proof of any of the matters specified insub-paragraph (6)(a), (b) or (c)(i) above shall be given to their satisfactionby the production of documents made before 21st June 1988.

Textual Amendments

F1 Sch. 3 repealed (1.9.1994) by 1994 c. 23, ss. 100(2), 101(1), Sch. 15