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Finance (No.2) Act 1987

Status:

This is the original version (as it was originally enacted).

  1. Introductory Text

  2. PART I Income Tax, Corporation Tax and Capital Gains Tax

    1. CHAPTER I Profit-Related Pay

      1. Preliminary

        1. 1.Interpretation.

        2. 2.Taxation of profit-related pay.

      2. The relief

        1. 3.Relief from tax.

        2. 4.Exceptions from relief.

      3. Registration

        1. 5.Persons who may apply for registration.

        2. 6.Excluded employments.

        3. 7.Applications for registration.

        4. 8.Registration.

        5. 9.Change of scheme employer.

        6. 10.Cancellation of registration.

      4. Administration

        1. 11.Recovery of tax from scheme employer.

        2. 12.Annual returns etc.

        3. 13.Other information.

        4. 14.Information: penalties.

        5. 15.Appeals.

      5. Supplementary

        1. 16.Partnerships.

        2. 17.Independent accountants.

    2. CHAPTER II Personal Pension Schemes

      1. Preliminary

        1. 18.Interpretation.

        2. 19.Approval of schemes.

      2. Restrictions on approval: establishment and benefits

        1. 20.Establishment of schemes.

        2. 21.Scope of benefits.

        3. 22.Annuity to member.

        4. 23.Lump sum to member.

        5. 24.Annuity after death of member.

        6. 25.Lump sum on death of member.

        7. 26.Return of contributions on death of member.

      3. Other restrictions on approval

        1. 27.Scheme administrator.

        2. 28.Transfer payments.

        3. 29.Excess contributions.

        4. 30.Restriction on contributors.

      4. Tax consequences of approval: member’s contributions

        1. 31.Deduction from relevant earnings.

        2. 32.Limit on deductions.

        3. 33.Carry-back of contributions.

        4. 34.Carry-forward of relief.

        5. 35.Meaning of “relevant earnings”.

        6. 36.Earnings from pensionable employment.

        7. 37.Meaning of “net relevant earnings”.

      5. Other tax consequences of approval

        1. 38.Employer’s contributions.

        2. 39.Exemption for scheme investments.

        3. 40.Unit trusts.

        4. 41.Treatment of annuities.

      6. Miscellaneous

        1. 42.Minimum contributions under Social Security Act 1986.

        2. 43.Withdrawal of approval.

        3. 44.Tax on unauthorised payments etc.

        4. 45.Relief by deduction from contributions.

        5. 46.Claims for relief.

        6. 47.Appeals.

        7. 48.Adjustment of relief.

        8. 49.Exclusion of double relief.

        9. 50.Information about payments.

        10. 51.Information: penalties.

        11. 52.Remuneration of Ministers and other officers.

        12. 53.Contributions under unapproved arrangements.

        13. 54.Retirement annuities.

        14. 55.Transitional provisions: general.

        15. 56.Transitional provisions: approvals.

        16. 57.Minor and consequential amendments.

    3. CHAPTER III General

      1. Pension and share schemes

        1. 58.Occupational pension schemes.

        2. 59.Employee share schemes.

      2. Companies

        1. 60.Payments of interest etc. between related companies.

        2. 61.Apportionment of income etc. of close companies.

      3. Provisions having an overseas element

        1. 62.United Kingdom members of partnerships controlled abroad.

        2. 63.Limitation of group relief in relation to certain dual resident companies.

        3. 64.Limitation of other reliefs in dealings involving dual resident investing companies.

        4. 65.Controlled foreign companies: acceptable distribution policy.

        5. 66.Offshore funds.

        6. 67.Double taxation relief: interest on certain overseas loans.

        7. 68.Double taxation relief: underlying tax reflecting interest on loans.

      4. Miscellaneous

        1. 69.Disclosure of employment information obtained from Inland Revenue.

        2. 70.Lloyd’s underwriters.

        3. 71.Relief for losses on unquoted shares in trading companies.1980 c. 48.

        4. 72.Allowances for dwelling-houses let on assured tenancies.

        5. 73.Recognised investment exchanges.

    4. CHAPTER IV Capital Gains

      1. Companies' chargeable gains

        1. 74.General rules.

        2. 75.Life assurance business.

        3. 76.Gains from oil extraction activities etc.

        4. 77.Double taxation relief.

      2. Miscellaneous

        1. 78.Collective investment schemes.

        2. 79.Building societies: groups of companies.

        3. 80.Roll-over relief not available for gains on oil licences.

        4. 81.Commodity and financial futures and options.

    5. CHAPTER V Taxes Management Provisions

      1. Company returns

        1. 82.Return of profits.

        2. 83.Failure to make return for corporation tax.

        3. 84.Assessment of amounts due by way of penalty.

      2. Interest etc.

        1. 85.Interest on overdue corporation tax etc.

        2. 86.Supplementary provisions as to interest on overdue tax.

        3. 87.Interest on tax overpaid.

        4. 88.Recovery of overpayment of tax etc.

        5. 89.Prescribed rate of interest.

      3. Miscellaneous

        1. 90.Corporation tax to be payable without assessment.

        2. 91.Close companies: loans to participators.

        3. 92.Amendments relating to PAYE.

        4. 93.Sub-contractors in the construction industry.

        5. 94.Failure to do things within a limited time.

        6. 95.Interpretation of Chapter V and consequential and supplementary provisions.

  3. PART II Inheritance Tax etc.

    1. 96.Interests in possession.

    2. 97.Acceptance in lieu: capital transfer tax and estate duty.

    3. 98.Personal pension schemes.

  4. PART III Miscellaneous and Supplementary

    1. 99.Stamp duty: options, etc.

    2. 100.Stamp duty Reserve tax.

    3. 101.Oil taxation.

    4. 102.Government fees and charges.

    5. 103.Consumption in port of goods transhipped for use as stores, etc.

    6. 104.Short title, interpretation, construction and repeals.

  5. SCHEDULES

    1. SCHEDULE 1

      Profit-Related Pay Schemes: Conditions for Registration

      1. Form.

        1. 1.The terms of the scheme must be set out in...

      2. Employer and employment unit.

        1. 2.The scheme must identify the scheme employer.

        2. 3.If the scheme employer does not pay the emoluments of...

        3. 4.(1) The scheme must identify the undertaking to which the...

      3. Employees.

        1. 5.The scheme must contain provisions by reference to which the...

        2. 6.The scheme must contain provisions ensuring that no payments are...

        3. 7.(1) The scheme must contain provisions ensuring that no payments...

        4. 8.(1) The persons within this paragraph are any of the...

      4. Profit periods.

        1. 9.The scheme must identify the accounting period or periods by...

        2. 10.(1) Subject to sub-paragraphs (2) and (3) below, any such...

      5. Distributable pool.

        1. 11.The scheme must contain provisions by reference to which the...

        2. 12.Except where the scheme is a replacement scheme (within the...

        3. 13.(1) Method A is that the distributable pool is equal...

        4. 14.(1) Method B is that the distributable pool is—

        5. 15.If the scheme is a replacement scheme (within the meaning...

      6. Payments from distributable pool, etc.

        1. 16.The scheme must provide for the whole of the distributable...

        2. 17.The scheme must make provision as to when payments will...

        3. 18.(1) The provisions of the scheme must be such that...

      7. Ascertainment of profits.

        1. 19.(1) The scheme must provide for the preparation of a...

        2. 20.(1) The scheme must provide that, in preparing a profit...

    2. SCHEDULE 2

      Personal Pension Schemes Etc.

      1. 1.In section 226(13) of the Taxes Act, after “means” there...

      2. 2.(1) In section 332(2) of the Taxes Act (exceptions to...

      3. 3.In section 14(1) of the Finance Act 1973 (lump sum...

      4. 4.(1) In section 26 of the Finance Act 1978 (open...

      5. 5.In section 45(2) of the Finance Act 1984, after paragraph...

      6. 6.In paragraph 1 of Schedule 11 to the Finance Act...

    3. SCHEDULE 3

      Occupational Pension Schemes

      1. PART I Amendments of Finance Act 1970 Etc.

        1. The Finance Act 1970.

          1. 1.(1) In subsection (2A) of section 19 of the Finance...

          2. 2.(1) In subsection (3) of section 19 (withdrawal of approval)...

          3. 3.(1) Section 20 (discretionary approval) shall be amended as follows....

          4. 4.(1) In subsection (4) of section 21 (tax relief for...

          5. 5.After subsection (7) of section 21 there shall be inserted—...

          6. 6.(1) In subsection (2) of section 22 (tax relief for...

          7. 7.(1) Section 26 (1) shall be amended as follows.

          8. 8.In section 26(2), after the words “the employer” there shall...

          9. 9.(1) In Schedule 5 to the Finance Act 1970, in...

          10. 10.In paragraph 3 of that Schedule, at the end there...

          11. 11.In paragraph 6 (which shall become paragraph 6(1)) of that...

          12. 12.After paragraph 6 of that Schedule there shall be inserted—...

          13. 13.In paragraph 7 (which shall become paragraph 7(1)) of that...

          14. 14.In paragraph 8(2)(a) of that Schedule, after the words “such...

          15. 15.In paragraph 9 of that Schedule, after sub-paragraph (1) there...

        2. The Taxes Act.

          1. 16.In section 323(4) of the Taxes Act (insurance companies: interpretation...

        3. The Taxes Management Act 1970.

          1. 17.In both columns in the Table in section 98 of...

      2. PART II Schemes Approved before the Passing of this Act

        1. Preliminary.

          1. 18.(1) This Part of this Schedule shall be deemed to...

        2. Accelerated accrual.

          1. 19.(1) This paragraph applies where an employee becomes a member...

          2. 20.(1) This paragraph applies where an employee becomes a member...

          3. 21.(1) This paragraph applies where an employee becomes a member...

        3. Final remuneration.

          1. 22.(1) This paragraph applies where an employee who is a...

        4. Lump sums.

          1. 23.(1) This paragraph applies where an employee becomes a member...

        5. Additional voluntary contributions.

          1. 24.(1) This paragraph applies where— (a) the rules of the...

          2. 25.(1) This paragraph applies where an employee who is a...

        6. Supplementary.

          1. 26.(1) In this Part of this Schedule “relevant annual remuneration”...

    4. SCHEDULE 4

      Dual Resident Investing Companies

      1. PART I Division of Accounting Periods Covering 1st April 1987.

        1. 1.(1) This Part of this Schedule has effect in the...

        2. 2.Subject to paragraph 5 below, for the purposes referred to...

        3. 3.If, in the straddling period of a dual resident investing...

      2. PART II Early Payments of Interest Etc and Charges on Income

        1. Interpretation.

          1. 4.In this Part of this Schedule— (a) “the principal section”...

        2. Early payment of interest etc.

          1. 5.(1) If the conditions in sub-paragraph (2) or sub-paragraph (3)...

        3. Early payment of charges on income.

          1. 6.(1) If, in the case of a dual resident investing...

        4. Appeals.

          1. 7.Notice of the giving of a direction under paragraph 5...

        5. General.

          1. 8.The preceding provisions of this Schedule have effect in priority...

    5. SCHEDULE 5

      Companies' Chargeable Gains: Transitional Provisions

      1. PART I General Rules

        1. Interpretation.

          1. 1.In this Part of this Schedule— (a) a “straddling period”...

        2. Chargeable gains comprised in profits.

          1. 2.(1) It shall be assumed for the purposes of this...

        3. Advance corporation tax and liability of small companies.

          1. 3.(1) This paragraph has effect to determine for the purposes...

        4. Other references to the income of a company charged to corporation tax.

          1. 4.For the straddling period, any reference in any enactment, other...

      2. PART II Special Cases

        1. Interpretation.

          1. 5.In this Part of this Schedule “straddling period” has the...

        2. Life assurance companies.

          1. 6.(1) Subject to the following provisions of this paragraph, where...

          2. 7.(1) For a straddling period of an insurance company carrying...

        3. Companies carrying on oil extraction activities etc.

          1. 8.(1) Subject to the following provisions of this paragraph, a...

    6. SCHEDULE 6

      Management Provisions: Supplementary and Consequential Provisions

      1. Companies' capital gains.

        1. 1.(1) With respect to chargeable gains accruing in accounting periods...

        2. 2.With respect to chargeable gains accruing in accounting periods ending...

        3. 3.(1) With respect to chargeable gains accruing in accounting periods...

        4. 4.(1) Section 278 of the Taxes Act (company ceasing to...

        5. 5.(1) With respect to chargeable gains accruing in chargeable periods...

      2. Relief for unremittable income.

        1. 6.(1) Section 418 of the Taxes Act (relief for unremittable...

      3. Charges on non-residents.

        1. 7.With respect to tax in respect of accounting periods ending...

      4. Lloyd’s underwriting agents.

        1. 8.(1) The Treasury may by regulations made by statutory instrument...

    7. SCHEDULE 7

      Inheritance Tax: Interests in Possession

      1. 1.After section 54 of the Inheritance Tax Act 1984 (in...

      2. 2.In section 56 of the 1984 Act (exclusion of certain...

      3. 3.(1) Section 201 of the 1984 Act (liability for tax...

      4. 4.(1) Section 216 of the 1984 Act (delivery of accounts)...

      5. 5.In section 265 of the 1984 Act (chargeable transfers affecting...

    8. SCHEDULE 8

      Amendments of Schedule 10 to Finance Act 1987

      1. 1.At the end of paragraph 1 (interpretation) there shall be...

      2. 2.(1) In paragraph 5 (content of nomination) in sub-paragraph (1)(b)—...

      3. 3.(1) In paragraph 8 (revision of nominations) after sub-paragraph (2)...

      4. 4.In paragraph 9 (effective volume for nominated transactions) for sub-paragraph...

      5. 5.(1) In paragraph 11 (which defines the aggregate nominated proceeds...

      6. 6.In paragraph 12 (nominations of blended oil by a participator...

    9. SCHEDULE 9

      Repeals

      1. PART I Income Tax and Corporation Tax: General

      2. PART II Capital Gains

      3. PART III Inheritance Tax

      4. PART IV Stamp Duty Reserve Tax

      5. PART V Oil Taxation

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