Finance Act 1968

40 Minerals: betterment levy, income tax and corporation tax

(1) This section has effect as respects the power of making regulations under section 74 of the [1967 c. 1.] Land Commission Act 1967 (power to adapt betterment levy for minerals by regulations requiring affirmative resolution of House of Commons) and has effect without prejudice to the generality of that section.

(2) The amount, rate and incidence of betterment levy in respect of mining leases (as defined by the regulations) may be altered by the regulations so that—

(a) betterment levy is charged from time to time by reference to the actual amount of the rents, royalties and other payments (including premiums) which are received or become receivable under the lease,

(b) the rate may be less than that prescribed under section 28 of the Land Commission Act 1967,

(c) the person chargeable in respect of any payment is, or is ascertained by reference to, the person entitled to the payment,

and the regulations may contain such transitional or other consequential provisions, including provisions making exceptions or modifications in Part III of the said Act of 1967, as may appear to the Minister making the regulations to be necessary or expedient.

(3) The regulations shall, as respects every mining lease, confer a right of election as respects the application to the mining lease of all provisions made in accordance with subsection (2) above so that—

(a) in the case of a mining lease granted on or after 6th April 1968, an election may be made in accordance with the regulations excluding the application of those provisions ;

(b) in the case of a mining lease granted before that date, no such provisions shall apply unless an election is made in accordance with the regulations.

(4) Where betterment levy is directly charged on any payment which is charged to tax under section 180 of the [1952 c. 10.] Income Tax Act 1952 (mining rents and royalties), the amount of betterment levy so charged shall be treated—

(a) for the purposes of section 181 of that Act (management expenses of owner of mineral rights) as a sum disbursed as an expense of management in the year of assessment for which the tax is charged, and

(b) for the purposes of section 54(4) of the [1965 c. 25.] Finance Act 1965 (corresponding provision for corporation tax) as a sum so disbursed in the accounting period in which the payment falls to be taken into account for corporation tax.

(5) Where betterment levy is directly charged on a payment which is charged to tax under Case VIII of Schedule D, the amount of betterment levy so charged shall for the purposes of Case VIII be treated as a payment made by the landlord in respect of management of the property in the year of assessment in which he becomes entitled to the payment:

Provided that where the amount of the payment is reduced under section 22 of the [1963 c. 25.] Finance Act 1963 (treatment of premiums and other payments as rent) the amount of the betterment levy charged thereon shall be treated for the purposes of this subsection as reduced in the same proportion.

(6) Paragraph 1 of Schedule 15 to the [1967 c. 54.] Finance Act 1967 (premiums, etc., under leases: allowance of betterment levy) shall not apply to betterment levy which is directly charged on any payment.

(7) For the purposes of this section betterment levy is " directly charged " on a payment if it is charged in accordance with regulations made in accordance with subsection (2) above.

(8) This section—

(a) so far as it relates to betterment levy, applies as respects any payment made before or after the passing of this Act, and shall be construed as one with Part III of the [1967 c. 1.] Land Commission Act 1967,

(b) so far as it relates to income tax, has effect for the year 1967-68 and subsequent years of assessment, and shall be construed as one with the Income Tax Acts,

(c) so far as it relates to corporation tax, has effect for any accounting period ending after 5th April 1967, and shall be construed as one with the Corporation Tax Acts,

and there shall be made all such adjustments, whether by way of discharge or repayment of tax or the making of assessments, as are required to give effect to this subsection.

(9) The Land Commission shall afford to any officer of the Board such information as he may require for the purposes of this section.