Income and Corporation Taxes Act 1988

F1 3 (1) In any case where—

[F2 (a) an insurance company’s self-assessment for an accounting period becomes final, and

(b) the aggregate amount of the provisional repayments made to the company for that accounting period exceeds the appropriate amount,]

the excess, together with the amount of any relevant interest, shall be treated for the purposes of [F3 paragraph 52 of Schedule 18 to the Finance Act 1998] as if it were an amount of corporation tax for that accounting period which had been repaid to the insurance company and which ought not to have been so repaid.

[F4 (1ZA) In its application by sub-paragraph (1) above, section 30 of the Management Act shall have effect as if, instead of the provision made by subsection (5), it provided that an assessment under that section by virtue of sub-paragraph (1) above is not out of time under section 34 of that Act if it is made no later than the end of the accounting period following that in which the assessment mentioned in paragraph (a) of that sub-paragraph is finally determined.]

[F5 (1A) For the purposes of sub-paragraph (1)(b) above, the appropriate amount for an accounting period of a company is the amount (if any) which, on the assumptions in sub-paragraphs (1B) and (1C) below and disregarding any provisional repayments, the company would be entitled to be F6 . . . repaid, when its self-assessment for the period becomes final, in respect of its pension business for that accounting period on a claim such as is mentioned in [F7 paragraph 9(2) of Schedule 18 to the Finance Act 1998]F8 . . . in respect of—

(a) income tax borne by deduction on payments received by the company in that accounting period and referable to its pension business, F9 . . .

(b) F10 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(1B) The first assumption is that no F11 . . . repayments have been made to the company in respect of—

(a) income tax such as is mentioned in paragraph (a) of sub-paragraph (1A) above, F12 . . .

(b) F13 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

before the company’s self-assessment for the accounting period in question becomes final.

(1C) The second assumption is that in making any set off under—

(a) section 7(2), [F14 or]

(b) paragraph 5 of Schedule 16, F15 . . .

F15 (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

income tax borne by deduction on income which is not referable to pension business is set off before income tax so borne on income which is referable to pension business.

[F16 (1D) Paragraph 53 of Schedule 18 to the Finance Act 1998 (time limit for recovery of excessive repayments etc.) does not apply to an assessment under paragraph 52 of that Schedule made by virtue of this paragraph.

But such an assessment is not out of time under paragraph 46 of that Schedule (general six year time limit for assessments) if it is made not later than the end of the accounting period following that in which the self-assessment mentioned in sub-paragraph (1)(a) above becomes final.]]

(2) In this paragraph, “relevant interest” means interest—

(a) on so much of the excess referred to in sub-paragraph (1) above as is or was from time to time outstanding,

(b) for any period for which it is or was so outstanding, and

(c) at the rate applicable under section 178 of the Finance Act 1989 for the purposes of section 87A of the Management Act (interest on overdue corporation tax).

(3) In the application of section 87A of the Management Act in relation to an amount assessed to corporation tax under [F17 paragraph 52 of Schedule 18 to the Finance Act 1998] by virtue of this paragraph—

(a) the amount so assessed shall be taken to have become due and payable on the date on which that assessment was made; and

(b) the words [F18 “(in accordance with section 59D of this Act)”] in subsection (1) shall accordingly be disregarded.

(4) In determining the amount of any relevant interest, any question whether the excess mentioned in sub-paragraph (1) above (in the following provisions of this paragraph referred to as “the principal”) or any part of it is or was “outstanding” at any time shall be determined in accordance with sub-paragraphs (5) to [F19 (8)] below.

(5) So much of the principal as does not exceed the amount of the last provisional repayment made to the company for the accounting period in question shall be taken to have become outstanding on the date on which that provisional repayment was made.

(6) So much (if any) of the principal as—

(a) exceeds the amount of the provisional repayment referred to in sub-paragraph (5) above, but

(b) does not exceed the amount of the preceding provisional repayment for that accounting period,

shall be taken to have become outstanding on the date on which that preceding provisional repayment was made; and so on with any remaining portion of the principal and any preceding provisional repayments for that accounting period.

(7) So much (if any) of the principal as has become outstanding as mentioned in sub-paragraph (5) or (6) above and has at any time neither been repaid to the Board nor been assessed to corporation tax under [F20 paragraph 52 of Schedule 18 to the Finance Act 1998] by virtue of this paragraph shall be taken to remain outstanding at that time (and an amount shall accordingly be taken to cease being outstanding only when it is repaid to the Board or when it is so assessed).

[F21 (8) For the purposes of sub-paragraph (7) above, any repayment made by the company in respect of an amount F22 . . . repaid to it in respect of—

(a) income tax such as is mentioned in paragraph (a) of sub-paragraph (1A) above, F23 . . .

(b) F24 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

shall be treated as a repayment in respect of the principal, taking an earlier such repayment by the company before a later.

(9) In this paragraph “self-assessment” means an assessment included in a [F25 company tax return] and includes a reference to such an assessment as amended.]

Textual Amendments

F1 Sch. 19AB inserted (25.7.1991 with effect as mentioned in s. 49(3) in relation to accounting periods beginning on or after 2.10.1992) by Finance Act 1991 (c. 31, SIF 63:1), s. 49, Sch.8; S.I. 1992/1746, art.2

F2 Sch. 19AB para. 3(1)(a)(b) substituted (with effect in accordance with s. 169(3) of the amending Act) by Finance Act 1996 (c. 8), Sch. 34 para. 3(2)

F3 Words in Sch. 19AB para. 3(1) substituted (with effect in accordance with s. 117(4)(5) of the amending Act) by Finance Act 1998 (c. 36), Sch. 19 para. 51(7); S.I. 1998/3173, art. 2

F4 Sch. 19AB para. 3(1ZA) inserted (with effect in accordance with s. 91(2) of the amending Act) by Finance Act 1998 (c. 36), s. 91(1)

F5 Sch. 19AB para. 3(1A)-(1D) inserted (with effect in accordance with s. 169(3) of the amending Act) by Finance Act 1996 (c. 8), Sch. 34 para. 3(3)

F6 Words in Sch. 19AB para. 3(1A) repealed (with effect in accordance with Sch. 3 paras. 11(1), 12 of the repealing Act) by Finance (No. 2) Act 1997 (c. 58), Sch. 3 para. 11(3)(a), Sch. 8 Pt. 2(7), Note

F7 Words in Sch. 19AB para. 3(1A) substituted (with effect in accordance with s. 117(4)(5) of the amending Act) by Finance Act 1998 (c. 36), Sch. 19 para. 51(8); S.I. 1998/3173, art. 2

F8 Words in Sch. 19AB para. 3(1A) repealed (with effect in accordance with Sch. 3 paras. 11(1), 12 of the repealing Act) by Finance (No. 2) Act 1997 (c. 58), Sch. 3 para. 11(3)(b), Sch. 8 Pt. 2(7), Note

F9 Sch. 19AB para. 3(1A): word preceding para. (b) repealed (with effect in accordance with Sch. 3 paras. 11(1), 12 of the repealing Act) by Finance (No. 2) Act 1997 (c. 58), Sch. 8 Pt. 2(7), Note

F10 Sch. 19AB para. 3(1A)(b) repealed (with effect in accordance with Sch. 3 paras. 11(1), 12 of the repealing Act) by Finance (No. 2) Act 1997 (c. 58), Sch. 3 para. 11(3)(c), Sch. 8 Pt. 2(7), Note

F11 Words in Sch. 19AB para. 3(1B) repealed (with effect in accordance with Sch. 3 paras. 11(1), 12 of the repealing Act) by Finance (No. 2) Act 1997 (c. 58), Sch. 3 para. 11(4)(a), Sch. 8 Pt. 2(7), Note

F12 Sch. 19AB para. 3(1B): word preceding para. (b) repealed (with effect in accordance with Sch. 3 paras. 11(1), 12 of the repealing Act) by Finance (No. 2) Act 1997 (c. 58), Sch. 8 Pt. 2(7), Note

F13 Sch. 19AB para. 3(1B)(b) repealed (with effect in accordance with Sch. 3 paras. 11(1), 12 of the repealing Act) by Finance (No. 2) Act 1997 (c. 58), Sch. 3 para. 11(4)(b), Sch. 8 Pt. 2(7), Note

F14 Sch. 19AB para. 3(1C): word at the end of para. (a) inserted (with effect in accordance with s. 37(3) of the amending Act) by Finance Act 1998 (c. 36), s. 37(2)(a); S.I. 1999/619, art. 2

F15 Sch. 19AB para. 3(1C)(c) and preceding word repealed (with effect in accordance with s. 37(3) of the repealing Act) by Finance Act 1998 (c. 36), s. 37(2)(b), Sch. 27 Pt. 3(3); S.I. 1999/619, art. 2

F16 Sch. 19AB para. 3(1D) substituted (with effect in accordance with s. 117(4)(5) of the amending Act) by Finance Act 1998 (c. 36), Sch. 19 para. 51(9); S.I. 1998/3173, art. 2

F17 Words in Sch. 19AB para. 3(3) substituted (with effect in accordance with s. 117(4)(5) of the amending Act) by Finance Act 1998 (c. 36), Sch. 19 para. 51(10); S.I. 1998/3173, art. 2

F18 Words in Sch. 19AB para. 3(3)(b) substituted (with effect in accordance with s. 169(3) of the amending Act) by Finance Act 1996 (c. 8), Sch. 34 para. 3(4)

F19 Word in Sch. 19AB para. 3(4) substituted (with effect in accordance with s. 169(3) of the amending Act) by Finance Act 1996 (c. 8), Sch. 34 para. 3(5)

F20 Words in Sch. 19AB para. 3(7) substituted (with effect in accordance with s. 117(4)(5) of the amending Act) by Finance Act 1998 (c. 36), Sch. 19 para. 51(11); S.I. 1998/3173, art. 2

F21 Sch. 19AB para. 3(8)(9) added (with effect in accordance with s. 169(3) of the amending Act) by Finance Act 1996 (c. 8), Sch. 34 para. 3(6)

F22 Words in Sch. 19AB para. 3(8) repealed (with effect in accordance with Sch. 3 paras. 11(1), 12 of the repealing Act) by Finance (No. 2) Act 1997 (c. 58), Sch. 3 para. 11(5)(a), Sch. 8 Pt. 2(7), Note

F23 Sch. 19AB para. 3(8): word preceding para. (b) repealed (with effect in accordance with Sch. 3 paras. 11(1), 12 of the repealing Act) by Finance (No. 2) Act 1997 (c. 58), Sch. 8 Pt. 2(7), Note

F24 Sch. 19AB para. 3(8)(b) repealed (with effect in accordance with Sch. 3 paras. 11(1), 12 of the repealing Act) by Finance (No. 2) Act 1997 (c. 58), Sch. 3 para. 11(5)(b), Sch. 8 Pt. 2(7), Note

F25 Words in Sch. 19AB para. 3(9) substituted (with effect in accordance with s. 117(4)(5) of the amending Act) by virtue of Finance Act 1998 (c. 36), Sch. 19 para. 51(12); S.I. 1998/3173, art. 2