“155A Care for children.

(1)

Where a benefit consists in the provision for the employee of care for a child, section 154 does not apply to the benefit to the extent that it is provided in qualifying circumstances.

(2)

For the purposes of subsection (1) above the benefit is provided in qualifying circumstances if—

(a)

the child falls within subsection (3) below,

(b)

the care is provided on premises which are not domestic premises,

(c)

the condition set out in subsection (4) below or the condition set out in subsection (5) below (or each of them) is fulfilled, and

(d)

in a case where the registration requirement applies, it is met.

(3)

The child falls within this subsection if—

(a)

he is a child for whom the employee has parental responsibility,

(b)

he is resident with the employee, or

(c)

he is a child of the employee and maintained at his expense.

(4)

The condition is that the care is provided on premises which are made available by the employer alone.

(5)

The condition is that—

(a)

the care is provided under arrangements made by persons who include the employer,

(b)

the care is provided on premises which are made available by one or more of those persons, and

(c)

under the arrangements the employer is wholly or partly responsible for financing and managing the provision of the care.

(6)

The registration requirement applies where—

(a)

the premises on which the care is provided are required to be registered under section 1 of the Nurseries and Child-Minders Regulation Act 1948 or section 11 of the Children and Young Persons Act (Northern Ireland) 1968, or

(b)

any person providing the care is required to be registered under section 71 of the Children Act 1989 with respect to the premises on which it is provided;

and the requirement is met if the premises are so registered or (as the case may be) the person is so registered.

(7)

In subsection (3)(c) above the reference to a child of the employee includes a reference to a stepchild of his.

(8)

In this section—

“care” means any form of care or supervised activity, whether or not provided on a regular basis, but excluding supervised activity provided primarily for educational purposes;

“child” means a person under the age of eighteen;

“domestic premises” means any premises wholly or mainly used as a private dwelling;

“parental responsibility” has the meaning given in section 3(1) of the Children Act 1989.”

“Part I Tables of Flat Rate Cash Equivalents

Table ACars with an original market value up to £19,250 and having a cylinder capacity

Cylinder capacity of car in cubic centimetres	Age of car at end of relevant year of assessment
	Under 4 years	4 years or more
1400 or less	£1,700	£1,150
More than 1400 but not more than 2000	£2,200	£1,500
More than 2000	£3,550	£2,350

Table BCars with an original market value up to £19,250 and not having a cylinder capacity

Original market value of car	Age of car at end of relevant year of assessment
	Under 4 years	4 years or more
Less than £6,000	£1,700	£1,150
£6,000 or more but less than £8,500	£2,200	£1,500
£8,500 or more but not more than £19,250	£3,550	£2,350

Table CCars with an original market value of more than £19,250

Original market value of car	Age of car at end of relevant year of assessment
	Under 4 years	4 years or more
More than £19,250 but not more than £29,000	£4,600	£3,100
More than £29,000	£7,400	£4,900
(2) This section shall have effect for the year 1990-91 and subsequent years of assessment.”

“(3A)

A payment made by a close company is not a qualifying donation if it is of a sum which leaves less than £600 after deducting income tax under subsection (3) above.

(3B)

A payment made by a close company is not a qualifying donation if—

(a)

it is made subject to a condition as to repayment, or

(b)

the company or a connected person receives a benefit in consequence of making it and either the relevant value in relation to the payment exceeds two and a half per cent. of the amount given after deducting tax under section 339(3) or the amount to be taken into account for the purposes of this paragraph in relation to the payment exceeds £250.

(3C)

For the purposes of subsections (3B) above and (3D) below, the relevant value in relation to a payment to a charity is—

(a)

where there is one benefit received in consequence of making it which is received by the company or a connected person, the value of that benefit;

(b)

where there is more than one benefit received in consequence of making it which is received by the company or a connected person, the aggregate value of all the benefits received in consequence of making it which are received by the company or a connected person.

(3D)

The amount to be taken into account for the purposes of subsection (3B)(b) above in relation to a payment to a charity is an amount equal to the aggregate of—

(a)

the relevant value in relation to the payment, and

(b)

the relevant value in relation to each payment already made to the charity by the company in the accounting period in which the payment is made which is a qualifying donation within the meaning of this section.

(3E)

A payment made by a close company is not a qualifying donation if it is conditional on, or associated with, or part of an arrangement involving, the acquisition of property by the charity, otherwise than by way of gift, from the company or a connected person.

(3F)

A payment made by a company is not a qualifying donation unless the company gives to the charity to which the payment is made a certificate in such form as the Board may prescribe and containing—

(a)

in the case of any company, a statement to the effect that the payment is one out of which the company has deducted tax under subsection (3) above, and

(b)

in the case of a close company, a statement to the effect that the payment satisfies the requirements of subsections (3A) to (3E) above.

(3G)

A payment made by a company is not a qualifying donation if the company is itself a charity.”

“(7A)

In subsections (3B) to (3E) above references to a connected person are to a person connected with—

(a)

the company, or

(b)

a person connected with the company;

and section 839 applies for the purposes of this subsection.”

“326A Tax-exempt special savings accounts.

(1)

Subject to the provisions of section 326B, any interest or bonus payable on a deposit account in respect of a period when it is a tax-exempt special savings account shall not be regarded as income for any income tax purpose.

(2)

An account is a “tax-exempt special savings account” for the purposes of this section if the conditions set out in subsections (3) to (9) below and any further conditions prescribed by regulations made by the Board are satisfied when the account is opened; and subject to section 326B it shall continue to be such an account until the end of the period of five years beginning with the day on which it is opened, or until the death of the account-holder if that happens earlier.

(3)

The account must be opened on or after 1st January 1991 by an individual aged 18 or more.

(4)

The account must be with a building society or an institution authorised under the Banking Act 1987.

(5)

The account must be identified as a tax-exempt special savings account and the account-holder must not simultaneously hold any other such account (with the same or any other society or institution).

(6)

The account must not be a joint account.

(7)

The account must not be held on behalf of a person other than the account-holder.

(8)

The account must not be connected with any other account held by the account-holder or any other person; and for this purpose an account is connected with another if—

(a)

either was opened with reference to the other, or with a view to enabling the other to be opened on particular terms, or with a view to facilitating the opening of the other on particular terms, and

(b)

the terms on which either was opened would have been significantly less favourable to the holder if the other had not been opened.

(9)

There must not be in force a notice given by the Board to the society or institution prohibiting it from operating new tax-exempt special savings accounts.

326B Loss of exemption for special savings accounts.

(1)

A tax-exempt special savings account shall cease to be such an account if at any time after it is opened any of the conditions set out in subsections (4) to (8) of section 326A, or any further condition prescribed by regulations made by the Board, is not satisfied, or if any of the events mentioned in subsection (2) below occurs.

(2)

The events referred to in subsection (1) above are—

(a)

the deposit of more than £3,000 in the account during the period of 12 months beginning with the day on which it is opened, more than £1,800 in any of the succeeding periods of 12 months, or more than £9,000 in total;

(b)

a withdrawal from the account which causes the balance to fall below an amount equal to the aggregate of—

(i)

all the sums deposited in the account before the time of the withdrawal, and

(ii)

an amount equal to income tax at the basic rate on any interest or bonus paid on the account before that time (and for this purpose the basic rate in relation to any interest or bonus is the rate that was the basic rate when the interest or bonus was paid);

(c)

the assignment of any rights of the account-holder in respect of the account, or the use of such rights as security for a loan.

(3)

If at any time an account ceases to be a tax-exempt special savings account by virtue of subsection (1) above, the Income Tax Acts shall have effect as if immediately after that time the society or institution had credited to the account an amount of interest equal to the aggregate of any interest and bonus payable in respect of the period during which the account was a tax-exempt special savings account.

326C Tax-exempt special savings accounts: supplementary.

(1)

The Board may make regulations—

(a)

prescribing conditions additional to those set out in section 326A which must be satisfied if an account is to be or remain a tax-exempt special savings account;

(b)

making provision for the giving by the Board to building societies and other institutions of notices prohibiting them from operating new tax-exempt special savings accounts, including provision about appeals against the giving of notices;

(c)

requiring building societies and other institutions operating or proposing to operate tax-exempt special savings accounts to give information or send documents to the Board or to make documents available for inspection;

(d)

making provision as to the transfer of tax-exempt special savings accounts from one building society or institution to another;

(e)

generally for supplementing the provisions of sections 326A and 326B.

(2)

The reference in section 326A to a deposit account shall be taken to include a reference to a share account with a building society, and accordingly that section, section 326B and subsection (1) above shall apply to such an account with the necessary modifications.”

“(ca)

any reinsurance commission; or”.

“(ca)

there shall also be deducted from the amount treated as the expenses of management for any accounting period any reinsurance commission earned in the period which is referable to basic life assurance business; and”.

“(a)

the policy holders’ share of the relevant profits for any accounting period, or

(b)

where the business is mutual business, the whole of those profits

shall ”.

“89 Policy holders’ share of profits.

(1)

The references in section 88 above to the policy holders’ share of the relevant profits for an accounting period of a company carrying on life assurance business are references to the amount arrived at by deducting from those profits the Case I profits of the company for the period in respect of the business, reduced in accordance with subsection (2) below.

(2)

For the purposes of subsection (1) above, the Case I profits for a period shall be reduced by—

(a)

the amount, so far as unrelieved, of any franked investment income arising in the period as respects which the company has made an election under section 438(6) of the Taxes Act 1988, and

(b)

the shareholders’ share of any other unrelieved franked investment income arising in the period from investments held in connection with the business.

(3)

For the purposes of this section “the shareholders’ share” in relation to any income is so much of the income as is represented by the fraction

$\frac{A}{B}$

where—

• A is an amount equal to the Case I profits of the company for the period in question in respect of its life assurance business, and

• B is an amount equal to the excess of the company’s relevant non-premium income and relevant gains over its relevant expenses and relevant interest for the period.

(4)

Where there is no such excess as is mentioned in subsection (3) above, or where the Case I profits are greater than any excess, the whole of the income shall be the shareholders’ share; and (subject to that) where there are no Case I profits, none of the income shall be the shareholders’ share.

(5)

In subsection (3) above the references to the relevant non-premium income, relevant gains, relevant expenses and relevant interest of a company for an accounting period are references respectively to the following items as brought into account for the period, so far as referable to the company’s life assurance business,—

(a)

the company’s investment income from the assets of its long-term business fund together with its other income, apart from premiums;

(b)

any increase in the value (whether realised or not) of those assets;

(c)

expenses payable by the company;

(d)

interest payable by the company;

and if for any period there is a reduction in the value referred to in paragraph (b) above (as brought into account for the period), that reduction shall be taken into account as an expense of the period.

(6)

Except in so far as regulations made by the Treasury otherwise provide, in this section “brought into account” means brought into account in the revenue account prepared for the purposes of the Insurance Companies Act 1982; and where the company’s period of account does not coincide with the accounting period, any reference to an amount brought into account for the accounting period is a reference to the corresponding amount brought into account for the period of account in which the accounting period is comprised, proportionately reduced to reflect the length of the accounting period as compared with the length of the period of account.

(7)

In this section “Case I profits” means profits computed in accordance with the provisions of the Taxes Act 1988 applicable to Case I of Schedule D.

(8)

For the purposes of this section franked investment income is “unrelieved” if—

(a)

it has not been excluded from charge to tax by virtue of any provision,

(b)

no tax credit comprised in it has been paid, and

(c)

no relief has been allowed against it by deduction or set-off.”

“(6A)

For the purposes of this section—

(a)

“the policy holders’ share” of any franked investment income is so much of that income as is not the shareholders’ share within the meaning of section 89 of the Finance Act 1989, and

(b)

“the policy holders’ share of the relevant profits” has the same meaning as in section 88 of that Act.”

(a)

contracts under which the total premiums payable in any period of 12 months exceed £150; or

(b)

contracts made before 1st September 1990 under which the total premiums payable in any period of 12 months exceed £100,

unless all those contracts were made before 1st September 1987. ”

“(2)

The provisions of the Corporation Tax Acts which apply on the transfer of the whole or part of the long term business of an insurance company to another company shall apply in the same way—

(a)

on the transfer of the whole or part of the business of a friendly society to another friendly society (and on the amalgamation of friendly societies), and

(b)

on the transfer of the whole or part of the business of a friendly society to a company which is not a friendly society (and on the conversion of a friendly society into such a company),

so however that the Treasury may by regulations provide that those provisions as so applied shall have effect subject to such modifications and exceptions as may be prescribed by the regulations.

(3)

The Treasury may by regulations provide that the provisions of the Corporation Tax Acts which apply on the transfer of the whole or part of the long term business of an insurance company to another company shall have effect where the transferee is a friendly society subject to such modifications and exceptions as may be prescribed by the regulations.

(4)

Regulations under this section may make different provision for different cases and may include provision having retrospective effect.”

“(2A)

Subsection (1)(e) above shall not apply as regards an accounting period if—

(a)

the company is required to retain income in respect of the period by virtue of a restriction imposed by law, and

(b)

the amount of income the company is so required to retain in respect of the period exceeds an amount equal to 15 per cent. of the income the company derives from shares and securities.

(2B)

Subsection (2A) above shall not apply where—

(a)

the amount of income the company retains in respect of the accounting period exceeds the amount of income it is required by virtue of a restriction imposed by law to retain in respect of the period, and

(b)

the amount of the excess or, where the company distributes income in respect of the period, that amount together with the amount of income which the company so distributes is at least £10,000 or, where the period is less than 12 months, a proportionately reduced amount.

(2C)

Paragraph (e) of subsection (1) above shall not apply as regards an accounting period if the amount which the company would be required to distribute in order to fall within that paragraph is less than £10,000 or, where the period is less than 12 months, a proportionately reduced amount.”

“(3A)

In the case of a security issued on or after 9th June 1989, for the purposes of sub-paragraph (2) above “redemption” does not include any redemption which may be made before maturity only if—

(a)

the person who issued the security fails to comply with the duties imposed on him by the terms of issue,

(b)

the person who issued the security becomes unable to pay his debts, or

(c)

the security was issued by a company and a person gains control of the company in pursuance of the acceptance of an offer made by that person to acquire shares in the company.”

“(5)

If, in a case where paragraph 17 of Schedule 2 to the 1975 Act applies, an amount of petroleum revenue tax in respect of which a deduction has been made under subsection (1) above is repaid by virtue of an assessment under that Schedule or an amendment of such an assessment, then, so far as concerns so much of that repayment as constitutes the appropriate repayment,—

(a)

subsection (4) above shall not apply; and

(b)

the following provisions of this section shall apply in relation to the company which is entitled to the repayment.

(6)

In subsection (5) above and the following provisions of this section—

(a)

“the appropriate repayment” has the meaning assigned by sub-paragraph (2) of paragraph 17 of Schedule 2 to the 1975 Act;

(b)

in relation to the appropriate repayment, a “carried back loss” means an allowable loss which falls within sub-paragraph (1)(a) of that paragraph and which (alone or together with one or more other carried back losses) gives rise to the appropriate repayment;

(c)

in relation to a carried back loss, “the operative chargeable period” means the chargeable period in which the loss accrued; and

(d)

in relation to the company which is entitled to the appropriate repayment, “the relevant accounting period” means the accounting period in or at the end of which ends the operative chargeable period or, if the company’s ring fence trade is permanently discontinued before the end of the operative chargeable period, the last accounting period of that trade.

(7)

In computing for corporation tax the amount of the company’s income arising in the relevant accounting period from oil extraction activities or oil rights there shall be added an amount equal to the appropriate repayment; but this subsection has effect subject to subsection (8) below in any case where—

(a)

two or more carried back losses give rise to the appropriate repayment; and

(b)

the operative chargeable period in relation to each of the carried back losses is not the same; and

(c)

if subsection (6)(d) above were applied separately in relation to each of the carried back losses there would be more than one relevant accounting period.

(8)

Where paragraphs (a) to (c) of subsection (7) above apply, the appropriate repayment shall be treated as apportioned between each of the relevant accounting periods referred to in paragraph (c) of that subsection in such manner as to secure that the amount added by virtue of that subsection in relation to each of those relevant accounting periods is what it would have been if—

(a)

relief for each of the carried back losses for which there is a different operative chargeable period had been given by a separate assessment or amendment of an assessment under Schedule 2 to the 1975 Act; and

(b)

relief for a carried back loss accruing in an earlier chargeable period had been so given before relief for a carried back loss accruing in a later chargeable period.

(9)

Any additional assessment to corporation tax required in order to give effect to the addition of an amount by virtue of subsection (7) above may be made at any time not later than six years after the end of the calendar year in which is made the repayment of petroleum revenue tax comprising the appropriate repayment.

(10)

In this section “allowable loss” and “chargeable period” have the same meaning as in Part I of the 1975 Act and “calendar year” means a period of twelve months beginning on 1st January.”

“ring fence trade” means activities which—

(a)

fall within any of paragraphs (a) to (c) of subsection (1) of section 492; and

(b)

constitute a separate trade (whether by virtue of that subsection or otherwise)”.

“765A Movements of capital between residents of member States.

(1)

765(1) shall not apply to a transaction which is a movement of capital to which Article 1 of the Directive of the Council of the European Communities dated 24th June 1988 No. 88/361/EEC applies.

(2)

Where if that Article did not apply to it a transaction would be unlawful under section 765(1), the body corporate in question (that is to say, the body corporate resident in the United Kingdom) shall—

(a)

give to the Board within six months of the carrying out of the transaction such information relating to the transaction, or to persons connected with the transaction, as regulations made by the Board may require, and

(b)

where notice is given to the body corporate by the Board, give to the Board within such period as is prescribed by regulations made by the Board (or such longer period as the Board may in the case allow) such further particulars relating to the transaction, to related transactions, or to persons connected with the transaction or related transactions, as the Board may require.”

“(3A)

The fact that the allocations of shares in the company to which persons who are not directors or employees of the company are entitled are smaller than those to which directors or employees of the company are entitled shall not be regarded for the purposes of subsection (2)(b) above as meaning that they are not entitled on similar terms if—

(a)

each of the first-mentioned persons is also entitled, by reason of his office or employment and in priority to members of the public, to an allocation of shares in another company or companies which are offered to the public (at a fixed price or by tender) at the same time as the shares in the company, and

(b)

in the case of each of those persons the aggregate value (measured by reference to the fixed price or the lowest price successfully tendered) of all the shares included in the allocations to which he is entitled is the same, or as nearly the same as is reasonably practicable, as that of the shares in the company included in the entitlement of a comparable director or employee of the company.”

“468AA Authorised unit trusts: futures and options.

(1)

Trustees shall be exempt from tax under Case I of Schedule D in respect of income if—

(a)

the income is derived from transactions relating to futures contracts or options contracts, and

(b)

the trustees are trustees of a unit trust scheme which is an authorised unit trust as respects the accounting period in which the income is derived.

(2)

For the purposes of subsection (1) above a contract is not prevented from being a futures contract or an options contract by the fact that any party is or may be entitled to receive or liable to make, or entitled to receive and liable to make, only a payment of a sum (as opposed to a transfer of assets other than money) in full settlement of all obligations.

(3)

In this section—

“authorised unit trust” has the same meaning as in section 468, and

“unit trust scheme” has the same meaning as in section 469.”

“659A Futures and options.

(1)

For the purposes of sections 592(2), 608(2)(a), 613(4), 614(3) and (4), 620(6) and 643(2)—

(a)

“investments” (or “investment”)

includes futures contracts and options contracts, and

(b)

income derived from transactions relating to such contracts shall be regarded as income derived from (or income from) such contracts,

and paragraph 7(3)(a) of Schedule 22 to this Act shall be construed accordingly.

(2)

For the purposes of subsection (1) above a contract is not prevented from being a futures contract or an options contract by the fact that any party is or may be entitled to receive or liable to make, or entitled to receive and liable to make, only a payment of a sum (as opposed to a transfer of assets other than money) in full settlement of all obligations.”