Finance Act 1984

PART III Capital Transfer Tax

101 Reduction of tax

(1) Section 91(1) of the [1982 c. 39.] Finance Act .1982 (indexation of rate bands) shall not apply to chargeable transfers made in the year beginning with 6th April 1984.

(2) For the Tables in section 37(3) of the [1975 c. 7.] Finance Act 1975 there shall be substituted the Tables set out below.

FIRST TABLE

Portion of value		Rate of tax
Lower limit	Upper limit	Per cent.
£	£
0	64,000	Nil
64,000	85,000	30
85,000	116,000	35
116,000	148,000	40
148,000	185,000	45
185,000	232,000	50
232,000	285,000	55
285,000	—	60

SECOND TABLE

Portion of value		Rate of tax
Lower limit	Upper limit	Per cent.
£	£
0	64,000	Nil
64,000	85,000	15
85,000	116,000	17 1/2
116,000	148,000	20
148,000	185,000	22 1/2
185,000	232,000	25
232,000	285,000	27 1/2
285,000	—	30

(3) Subsection (2) above applies to any chargeable transfer made on or after 13th March 1984.

102 Special discretionary trusts: excluded property

(1) In section 113 of the [1982 c. 39.] Finance Act 1982 (charge to tax in respect of property leaving temporary charitable trusts), the following subsection shall be inserted after subsection (6) and will accordingly be applied by sections 114 (accumulation and maintenance trusts), 116 (property leaving employee trusts and newspaper trusts) and 118 (protective trusts and trusts for disabled persons) of that Act—

“(6A) Where the whole or part of the amount on which tax is charged under this section is attributable to property which was excluded property at any time during the relevant period then, in determining the rate at which tax is charged under this section in respect of that amount or part, no quarter throughout which that property was excluded property shall be counted.”.

(2) In subsection (7) of section 113 (which defines " relevant period " for the purposes of subsection (6)) for the words " subsection (6) " there shall be substituted the words " subsections (6) and (6A) ".

(3) This section has effect in relation to events on or after 9th March 1982.

103 Discretionary trusts: distributions made within two years of testator's death

(1) After subsection (1A) of section 47 of the [1975 c. 7.] Finance Act 1975 (certain distributions made within two years of testator's death to be treated as made under his will) there shall be inserted the following subsection—

“(1AA) This Part of this Act shall also apply as mentioned in subsection (1A)(b) above in any case where the circumstances are as mentioned in subsection (1A) but the event in question is one on which tax would be so chargeable apart from—

(a) section 115 of the [1982 c. 39.] Finance Act 1982 (property becoming subject to employee trusts);

(b) section 119 of that Act (property becoming held for charitable purposes or by exempt bodies); or

(c) paragraph 1(1) of Schedule 16 to that Act (property becoming comprised in maintenance funds for historic buildings).”

(2) This section has effect in relation to deaths occurring on or after 13th March 1984.

104 Property moving between settlements

(1) In section 121 of the Finance Act 1982 (property moving between settlements), the following subsection shall be added at the end—

“(3) Subsection (1) above does not apply where a reversionary interest in the property expectant on the termination of a qualifying interest in possession subsisting under the first settlement was settled on the trusts of the other settlement before 10th December 1981.”.

(2) In paragraph 3 of Schedule 7 to the [1975 c. 7.] Finance Act 1975 (certain government securities to be excluded property if person beneficially entitled is domiciled and ordinarily resident abroad) the following sub-paragraph shall be inserted after sub-paragraph (2A)—

“(2AA) Sub-paragraph (2A) above does not apply where a reversionary interest in the property expectant on the termination of a qualifying interest in possession subsisting under the first settlement was settled on the trusts of the second settlement before 10th December 1981.”.

(3) This section has effect in relation to events on or after 15th March 1983.

105 Adjustment of tax

(1) In paragraph 23(3) of Schedule 4 to the Finance Act 1975 (adjustment of tax in cases of fraud, wilful default or neglect), for the words " a person liable for the tax, the period " there shall be substituted the words “any of the following—

(a) a person liable for the tax ; and

(b) in the case of tax chargeable under Chapter II of Part IV of the [1982 c. 39.] Finance Act 1982, the person who is the settlor in relation to the settlement;

the period”.

(2) With effect from 1st April 1983, subsection (8) of section 114 of the [1976 c. 40.] Finance Act 1976 (transfers reported late) shall cease to have effect.

(3) Subsection (1) above has effect in relation to any fraud, wilful default or neglect coming to the knowledge of the Board on or after 1st April 1983.

106 Recovery of tax

(1) In Schedule 4 to the [1975 c. 7.] Finance Act 1975, after paragraph 22 there shall be inserted—

“22A —In Scotland, tax and interest on tax may, without prejudice to any other remedy, and if the amount of the tax and interest does not exceed the sum for the time being specified in section 35(1)(a) of the [1971 c. 58.] Sheriff Courts (Scotland) Act 1971, be sued for and recovered in the sheriff court.

22B An officer of the Board who is authorised by the Board to do so may address the court in any proceedings in a county court or sheriff court for the recovery of tax or interest on tax.”

(2) After paragraph 36 of that Schedule there shall be inserted—

“36A In any proceedings for the recovery of tax or interest on tax, a certificate by an officer of the Board—

(a) that the tax or interest is due, or

(b) that, to the best of his knowledge and belief, it has not been paid,

shall be sufficient evidence that the sum mentioned in the certificate is due or, as the case may be, unpaid; and a document purporting to be such a certificate shall be deemed to be such a certificate unless the contrary is proved.”

107 Relief for stud farms

(1) For the purposes of Schedule 14 to the [1981 c. 35.] Finance Act 1981 (capital transfer tax: relief for agricultural property) the breeding and rearing of horses on a stud farm and the grazing of horses in connection with those activities shall be taken to be agriculture and any buildings used in connection with those activities to be farm buildings.

(2) In paragraph 12 of Schedule 10 to the Finance Act 1975 (farm cottages) the existing provisions shall become sub-paragraph (1) and at the end there shall be inserted—

“(2) Expressions used in sub-paragraph (1) above and in Schedule 14 to the Finance Act 1981 have the same meaning in that sub-paragraph as in that Schedule.”

(3) In section 97 of the [1981 c. 35.] Finance Act 1981 (grant of tenancies of agricultural property) for subsection (2) there shall be substituted—

“(2) Expressions used in subsection (1) above and in Schedule 14 to this Act have the same meaning in that subsection as in that Schedule.”

(4) This section has effect in relation to transfers of value and other events occurring on or after 10th March 1981.

108 Pre-consolidation amendments

Schedule 21 to this Act (which contains amendments designed to facilitate, or otherwise desirable in connection with, the consolidation of the law relating to capital transfer tax) shall have effect.