Finance Act 2007

Transfer schemes: deemed periodical returns

3 (1) In ICTA, for section 444AA substitute—

“444AA Transfers of business: deemed periodical return

(1) This section applies where the whole, or substantially the whole, of the long-term business of a person (“the transferor”) is transferred from that person—

(a) by one insurance business transfer scheme, or

(b) by two or more insurance business transfer schemes which are associated.

(2) For the purposes of subsection (1) above two or more insurance business transfer schemes are associated if they form part of an arrangement for the transfer of the whole, or substantially the whole, of the transferor’s long-term business.

(3) Where (apart from this subsection) there would not be a periodical return of the transferor covering a period ending immediately before a relevant transfer date, there is to be deemed for the purposes of corporation tax to be a periodical return of the transferor covering the period—

(a) beginning immediately after the last period ending before the relevant transfer date which is covered by a periodical return of the transferor, and

(b) ending immediately before the relevant transfer date,

containing such entries as would be included in an actual periodical return of the transferor covering that period (and so making that period a period of account of the transferor).

(4) There is to be deemed for the purposes of corporation tax to be a periodical return of the transferor—

(a) covering a relevant transfer date, and

(b) containing such entries as would be included in an actual periodical return covering the relevant transfer date,

(and so making the relevant transfer date a period of account of the transferor).

(5) Any actual periodical return covering a period which includes a relevant transfer date is to be ignored for the purposes of corporation tax.

(6) Where the transferor continues to carry on long-term business after a relevant transfer date, there is to be deemed for the purposes of corporation tax to be a periodical return of the transferor covering the immediate post-RTD period containing such entries as would be included in an actual periodical return covering that period (and so making that period a period of account of the transferor).

(7) In this section “relevant transfer date” means—

(a) in relation to a case within paragraph (a) of subsection (1) above, the date that is the transfer date in relation to the insurance business transfer scheme, and

(b) in relation to a case within paragraph (b) of that subsection—

(i) the earliest date that is the transfer date in relation to any of the insurance business transfer schemes, other than one that is a preliminary non-EEA transfer scheme, and

(ii) (where there are two or more insurance business transfer schemes that are not preliminary non-EEA transfer schemes) the latest date that is the transfer date in relation to any of them.

(8) In subsection (6) above “the immediate post-RTD period” means the period beginning immediately after the relevant transfer date mentioned in that subsection and (subject to subsection (9) below) ending with—

(a) the end of the period covered by the periodical return covering a period which includes a relevant transfer date (if there is one), or

(b) (if there is not) the period covered by the accounts of the company prepared in accordance with generally accepted accounting practice which includes the relevant transfer date.

(9) If the case is within subsection (1)(b) above and two or more of the insurance business transfer schemes are not preliminary non-EEA transfer schemes, the period ends with the latest date that is the transfer date in relation to any of them if that is before the end of the period mentioned in paragraph (a) or (b) of subsection (8) above.

(10) In this section and sections 444AB to 444AEC “the transfer date”, in relation to an insurance business transfer scheme, means the date on which it takes effect.

(11) For the purposes of this section an insurance business transfer scheme is a preliminary non-EEA transfer scheme if—

(a) it is an insurance business transfer scheme by virtue of paragraph (b) of the definition of “insurance business transfer scheme” in section 431(2), and

(b) the transfer date in relation to it is earlier than the transfer date in relation to an associated insurance business transfer scheme which is an insurance business transfer scheme by virtue of paragraph (a) of that definition.”

(2) In section 12 of ICTA (accounting periods), for subsection (7C) substitute—

“(7C) Where section 444AA applies, an accounting period of the transferor (within the meaning of that section) shall end for the purposes of corporation tax with the end of any period covered by a periodical return deemed by that section.”

(3) In—

(a) section 432YA(2A) of ICTA, and

(b) section 82D(2A) of FA 1989,

for “444AA(3)” substitute “444AA(4)”.

(4) In section 213(10) of TCGA 1992, for “before the transfer” substitute “before the relevant transfer date (within the meaning of that section)”.