Finance Act 1989

Interest etc.U.K.

178 Setting of rates of interest.U.K.

(1)The rate of interest applicable for the purposes of an enactment to which this section applies shall be the rate which for the purposes of that enactment is provided for by regulations made by the Treasury under this section.

(2)This section applies to—

[F1(aa)section 15A of the Stamp Act 1891;]

(a)section 8(9) of the M1Finance Act 1894,

(b)section 18 of the M2Finance Act 1896,

(c)section 61(5) of the M3Finance (1909-10) Act 1910,

(d)section 17(3) of the M4Law of Property Act 1925,

(e)section 73(6) of the M5Land Registration Act 1925,

(f)[F2sections 59C, 86, 86A, 87, 87A, [F388], 103A] of the M6TaxesManagement Act 1970,

(g)paragraph 3 of Schedule 16A to the M7Finance Act 1973,

[F4(gg)[F5paragraph 6 of Schedule 1 to the Social Security Contributions and Benefits Act 1992],]

(h)paragraphs 15 and 16 of Schedule 2, and paragraph 8 of Schedule 5, to the M8Oil Taxation Act 1975,

[F6(i)section 283 of the M9Taxation of Chargeable Gains Act 1992;]

(j)paragraph 59 of Schedule 8 to the M10Development Land TaxAct 1976,

(k)sections 233 and 236(3) and (4) of the M11Inheritance TaxAct 1984,

(l)section 92 of the Finance Act 1986, and

(m)sections [F7118F] 160, 824, 825 and 826 of, [F8and paragraph 6B of Schedule 3 to] and paragraph 3 of Schedule 19A to, the M12Taxes Act 1988. [F9and]

F10(n). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .[F11and

(o)section 14(4) of the Ports Act 1991., and]

[F12(p)section 110 of the Finance Act 1999.]

(3)Regulations under this section may—

(a)make different provision for different enactments or for different purposes of the same enactment,

(b)either themselves specify a rate of interest for the purposes of an enactment or make provision for any such rate to be determined by referenceto such rate or the average of such rates as may be referred to in theregulations,

(c)provide for rates to be reduced below, or increased above, what theyotherwise would be by specified amounts or by reference to specified formulae,

(d)provide for rates arrived at by reference to averages to be rounded up ordown,

(e)provide for circumstances in which alteration of a rate of interest is oris not to take place, and

(f)provide that alterations of rates are to have effect for periods beginning on or after a day determined in accordance with the regulations in relationto interest running from before that day as well as from or from after thatday.

(4)The power to make regulations under this section shall be exercisable by statutory instrument which shall be subject to annulment in pursuance of aresolution of the House of Commons.

(5)Where—

(a)the rate provided for by regulations under this section as the rateapplicable for the purposes of any enactment is changed, and

(b)the new rate is not specified in the regulations,

the Board shall by order specify the new rate and the day from which ithas effect.

(6)In section 828(2) of the Taxes Act 1988 (powers to make orders which arenot exercisable by statutory instrument) the words “or section 178(5)of the Finance Act 1989” shall be added at the end.

(7)Subsection (1) shall have effect for periods beginning on or after such day as the Treasury may by order made by statutory instrument appoint and shall have effect in relation to interest running from before that day as well as from or from after that day; and different days may be appointed for different enactments.

Textual Amendments

F1S. 178(2)(aa) inserted (27.7.1999 with application to instruments executed on or after 1.10.1999) by 1999 c. 16, ss. 109(2)(4), 123(4)

F2Words in s. 178(2)(f) substituted (1.9.1994 with effect as mentioned in s. 199 of the amending Act) by 1994 c. 9, s. 196, Sch. 19 Pt. III para. 44; S.I. 1998/3173, art. 2

F3Words in s. 178(2)(f) repealed (29.4.1996 with effect as specified in Sch. 18 para. 17 of the amending Act) by 1996 c. 8, ss. 132, 205, Sch. 18 para. 13, Sch. 41 Pt. V(8), note

F6s. 178(2)(i) substituted (in relation to tax for the year 1992-1993 and subsequent years subject as mentioned in s. 289 of the substituting Act) by Taxation of Chargeable Gains Act 1992 (c. 12), ss. 289, 290, Sch. 10 para. 19(4) (with ss. 60, 101(1), 171, 201(3))

F7Words in s. 178(2)(m) inserted (29.4.1996) by 1996 c. 8, s. 156, Sch. 29 para. 8

F8Words in s. 178(2)(m) repealed (29.4.1996 with effect as mentioned in Sch. 7 paras. 32-35 of the amending Act) by 1996 c. 8, ss. 79(2), 205, Sch. 7 para. 30, Sch. 41 Pt. V(2), note

F11S. 178(2)(o) and word immediately proceeding it inserted (G.B.) by Ports Act 1991 (c. 52, SIF 58), s. 14(5).

F12S. 178(2)(p) and word “and” preceding inserted (27.7.1999 with application in relation to instruments executed on or after 1.10.1999) by 1999 c. 16, ss. 110(9)(10), 123(4)

Modifications etc. (not altering text)

C1S. 178 applied by Ports Act 1991 (c. 52, SIF 58), s. 14(4).

S. 178 applied (27.7.1993) by 1993 c. 34, s. 173, Sch. 19 Pt. II para. 11(4)

S. 178 applied (1.9.1994 with effect as mentioned in s. 199 of 1994 c. 9) by 1970 c. 9, s. 59C (as inserted by 1994 c. 9, s. 194); S.I. 1998/3173, art, 2

S. 178 applied (1.5.1995) by 1995 c. 4, s. 157(6)

S. 178 extended (1.5.1995) by 1995 c. 4, s. 157(6)

S. 178 applied (31.7.1997) by 1997 c. 58, s. 3, Sch. 2 para. 12(4)

S. 178 applied (27.7.1999 with application to instruments executed on or after 1.10.1999) by 1891 s. 15A(3) (as substituted (27.7.1999 with application to instruments executed on or after 1.10.1999) by 1999 c. 16, s. 109(1)(4))

S. 178 applied (27.7.1999 with application in relation to instruments executed on or after 1.10.1999) by 1999 c. 16, ss. 110(1)-(5)(10), 123(4)

C2 For regulations see S.I. 1989/1297 (inPart III Vol. 5).And see Tables Iand O Vol. 1

C3Power of appointment conferred by s. 178(7) partly exercised: 18.8.1989 appointed by S.I. 1989/1298 for all the enactments specified in s. 178(2) other than s. 87A of the 1970 Act and s. 826 of the 1988 Act

Marginal Citations

179 Provisions consequential on section 178.U.K.

(1)The words “rate applicable under section 178 of the Finance Act 1989”shall be substituted—

(a)for the words from “rate” to “annum” in—

(i)section 18(1) of the M13 Finance Act 1896,

(ii)section 61(5) of the M14 Finance (1909-10) Act 1910,

(iii)section 17(3) of the M15 Law of Property Act 1925,

(iv)section 73(6) of the M16 Land Registration Act 1925,

(v)paragraphs 15(1) and 16 of Schedule 2, and paragraph 8(4) of Schedule 5,to the M17 Oil Taxation Act 1975,

F13(vi). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(vii)sections 824(1) and 825(2) of the Taxes Act 1988,

(b) for the words“ prescribed rate” in—

(i)sections 86(1), 86A(1), 87(1), 87A(1) and (5) [F14and 88(1)] of the M18 Taxes Management Act 1970,

(ii)paragraph 3(4) of Schedule 16A to the M19 Finance Act1973, and

(iii)paragraph 3(4) of Schedule 19A to the Taxes Act 1988,

(c)for the words “rate which” onwards in—

(i)paragraph 59(1) of Schedule 8 to the M20 Development LandTax Act 1976, and

(ii)section 826(1) of the Taxes Act 1988,

(d)for the words “rate applicable under subsection (2) below” in section233(1) of the M21 Inheritance Tax Act 1984,

(e)for the words “rate for the time being applicable under section233(2)(b) above” in subsection (3), and the words “rate for the timebeing applicable under section 233(2)(a) above” in subsection (4), ofsection 236 of that Act,

(f)for the words “appropriate rate” in section 92(2) of the M22 Finance Act 1986, and

(g)for the words “rate prescribed from time to time by the Treasury byorder” in section 160(5)(d) of the Taxes Act 1988.

(2)In section 8(9) of the M23 Finance Act 1894, for thewords from “such interest” to “per cent.” there shall be substitutedthe words “interest at such rate not exceeding that applicable under section178 of the Finance Act 1989”.

(3)In section 236(4) of the Inheritance Tax Act 1984, for the words “as ifsection 233(1)(b) above had applied” there shall be substituted the words “from the end of the period mentioned in section 233(1)(b) above”.

(4)Any amendment made by subsection (1), (2) or (3) above shall have effect in relation to any period for which section 178(1) above has effect for thepurposes of the enactment concerned.

(5)Section 146(11) of the Taxes Act 1988 shall have effect in relation to anyyear of assessment beginning after the day on which section 178(1) above haseffect for the purposes of section 160 of that Act with the substitution ofthe words “applicable for the purposes of section 160” for the words “prescribed by the Treasury under section 160(5)”.

Textual Amendments

F13S. 179(1)(a)(vi) repealed (6.3.1992 with effect as mentioned in s. 289(1)(2) of the repealing Act) by Taxation of Chargeable Gains Act 1992 (c. 12), ss. 289, 290, Sch. 12 (with ss. 201(3), Sch. 11 paras. 22, 26(2), 27)

F14Words in s. 179(1)(b)(i) repealed (29.4.1996 with effect in accordance with Sch. 18 para. 17 of the amending Act) by 1996 c. 8, s. 205, Sch. 41 Pt. V

Marginal Citations

M181970c. 9.

180 Repayment interest: period of accrual.U.K.

(1)In section 48(1) of the M24 Finance Act 1975, after thewords “carry interest” there shall be inserted the words “from the dateon which the sums were paid until the order for repayment is issued”.

(2)In—

(a)paragraph 16 of Schedule 2 to the M25 Oil Taxation Act1975,

(b)section 105(7) of the M26 Finance Act 1980,

(c)paragraph 13(4) and (5) of Schedule 16 to the M27 FinanceAct 1981, and

(d)paragraph 10(4) of Schedule 19 to the M28 Finance Act1982,

for the word “repayment” there shall be substituted the words “theorder for repayment is issued”.

(3)In paragraph 59(1) of Schedule 8 to the M29 DevelopmentLand Tax Act 1976, after the word “later,” there shall be inserted thewords “until the order for repayment is issued”.

(4)In section 235(1) of the M30 Inheritance Tax Act 1984(and paragraph 19(3) of Schedule 4 to the M31 Finance Act1975), after the word “made” there shall be inserted the words “untilthe order for repayment is issued”.

(5)In section 92(2) of the M32 Finance Act 1986, for thewords “the time it was paid” there shall be substituted the words “thedate on which the payment was made until the order for repayment isissued”.

(6)In section 826(1) of the Taxes Act 1988, for the words “that repaymentor payment is made” there shall be substituted the words “the order forrepayment or payment is issued”.

(7)The amendments made by this section shall be deemed always to have hadeffect.

Marginal Citations