2. In regulation 6 of the Personal Portfolio Bonds (Tax) Regulations 1999(1) for paragraph (7) substitute—
“(7) In section 552—
(a)in subsection (1)—
(i)in paragraph (a) the words “unless satisfied that no gain is to be treated as arising by reason of the event,” shall be omitted;
(ii)in paragraph (b), for “paragraph (a) or (b) of subsection (2)” there shall be substituted “subsection (2)”;
(b)for subsection (2) there shall be substituted—
“(2) For the purposes of this section the condition is that the amount of the gain, or the aggregate amount of the gain and any other gains connected with it, exceeds one half of the basic rate limit for the relevant year of assessment.”;
(c)in subsection (5)—
(i)for paragraph (b) there shall be substituted—
“(b)the nature of the chargeable event and the date on which it is treated as having happened;”;
(ii)paragraph (c) shall be omitted;
(iii)for paragraph (d) there shall be substituted—
“(d)the amount of the gain treated as arising in accordance with regulations 5(2) and 6(1) of the Personal Portfolio Bonds (Tax) Regulations 1999;”;
(iv)in paragraph (f)(ii) the words “, except in a case where paragraph (c) above applies,” shall be omitted;
(d)for subsection (6) there shall be substituted—
“(6) For the purposes of subsection (1)(a) above, the relevant three month period is the period of three months beginning with the time given by regulation 5(3), (4) and (4A) of the Personal Portfolio Bonds (Tax) Regulations 1999(2).”;
(e)for subsection (7) there shall be substituted—
“(7) For the purposes of subsection (1)(b) above, the relevant three month period is whichever of the following periods ends later—
(a)the period of three months following the end of the year of assessment or, where the policy holder is a company, the financial year, in which the event happened; or
(b)if a certificate under subsection (1)(b) would not be required in respect of the event apart from the happening of another event, and that other event is a death or an assignment, the period of three months beginning with receipt of written notification of the death or the assignment.”;
(f)for subsection (9) there shall be substituted—
“(9) For the purposes of this section, the year of assessment or financial year to which a gain is attributable is the year in which the gain, treated as arising under regulations 5(2) and 6(1) of the Personal Portfolio Bonds (Tax) Regulations 1999, is treated as arising in accordance with regulation 5(3), (4) and (4A) of those Regulations.”;
(g)in subsection (10)—
(i)for the definition of “appropriate policy holder” there shall be substituted—
““appropriate policy holder” means the person who is the policy holder immediately before the happening of the event;”; and
(ii)the definition of “section 546 excess” shall be omitted; and
(h)each of the references to a chargeable event shall be taken to include a reference to the chargeable event treated as occurring by reason of paragraph (1).
(7A) In section 552ZA(3) subsection (3) shall be omitted.”.
Paragraph (4A) was inserted by regulation 3 of S.I. 2001/2724.
Section 552 is restructured, and section 552ZA inserted, by Part 2 of Schedule 28 to the Finance Act 2001 (c. 9).