Finance Act 1985

38 Interest paid on deposits with banks etc.

(1) Schedule 8 to the [1984 c. 43.] Finance Act 1984 (interest paid on deposits with banks etc.) shall be amended as follows.

(2) In paragraph 2 (meaning of "deposit-taker"), for the word " section ", in paragraph (f) of sub-paragraph (1), there shall be substituted the word " sub-paragraph " and for subparagraph (2) there shall be substituted the following subparagraph—

“(2) An order under sub-paragraph (1)(f) above may prescribe a person or class of person in relation to all relevant deposits or only in relation to relevant deposits of a kind specified in the order”.

(3) In paragraph 3(2), after paragraph (a) (person beneficially entitled to interest must be an individual), there shall be inserted the following paragraph—

“(ad) in Scotland, the person who is so entitled is a partnership all the partners of which are individuals ; or”.

(4) In paragraph 3(3) (deposits which are not relevant deposits), the following paragraphs shall be inserted after paragraph (d)—

“(dd) it is a general client account deposit;

(ddd) it forms part of a premiums trust fund (within the meaning of paragraph 16 of Schedule 10 to the Taxes Act) of an underwriting member of Lloyd's”.

(5) In paragraph 3, after sub-paragraph (4), there shall be inserted the following sub-paragraph—

“(4A) A declaration under sub-paragraph (3)(h) shall be in such form as may be prescribed or authorised, and; contain such information as may reasonably be required, by the Board”.

(6) In paragraph 3(8) (interpretation), the following definition shall be inserted after the definition of " appropriate person " —

• “' general client account deposit' means a deposit, held by the deposit-taker in a client account (other than one which is identified by the deposit-taker as one in which sums are held only for one or more particular clients of the person whose account it is) in respect of which that person is required by provision made under any enactment to make payments representing interest to some or all of the clients for whom, or on whose account, he received the sums deposited in the account”.

(7) After paragraph 3 there shall be inserted the following paragraph—

“3A(1) The Treasury may by order made by statutory instrument make amendments in this Schedule providing for deposits of a kind specified in the order to be or, as the case may be, not to be relevant deposits in relation to all deposit-takers or such deposit-takers or classes of deposit-taker as may be so specified.

(2) The Board may by regulations made by statutory instrument make provision—

(a) requiring any declaration under paragraph 3 (3)(h)(ii) above which does not give the address of the person making it, to be supported by a certificate given by the deposit-taker concerned—

(i) in such form as may be prescribed or authorised by the Board ; and

(ii) containing such information as may reasonably be required by the Board ; and

(b) generally for giving effect to the principal section and this Schedule.

(3) Any order or regulations made under this paragraph may contain such incidental and consequential provision as appears to the Treasury or, as the case may be, Board to be appropriate.

(4) A statutory instrument made in the exercise of the power conferred by this paragraph shall be subject to annulment in pursuance of a resolution of the Commons House of Parliament.”

(8) Subject to paragraph 6(1) of Schedule 8 to the [1984 c. 43.] Finance Act 1984 (deposits denominated in a foreign currency not to be treated as relevant deposits before 6th April 1986), subsections (3), (4) and (6) above apply in relation to payments of interest made or credited after 5th April 1985.

(9) There shall be made such assessments, or reductions of assessments, or, on a claim in that behalf, repayments of tax as may in any case be required in order to give effect to subsections (3), (4), (6) and (8) above.

(10) The words " Regulations under paragraph 3A of Schedule 8 to the [1984 c. 43.] Finance Act 1984 " shall be added at the end of each column in the Table in section 98 of the [1970 c. 9.] Taxes Management Act 1970 (penalties for failure to comply with notices, furnish information etc.).