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Textual Amendments
(1)Section 32 of the M1Finance Act 1991 (vocational training relief) shall be amended in accordance with the following provisions of this section.
(2)In subsection (1) (application of section) for paragraph (ca) (individual has attained school leaving age etc at time of paying for the course) there shall be substituted—
“(ca)at the time the payment is made, the individual—
(i)in a case where the qualifying course of vocational training is such a course by virtue only of paragraph (b) of subsection (10) below, has attained the age of thirty, or
(ii)in any other case, has attained school-leaving age and, if under the age of nineteen, is not a person who is being provided with full-time education at a school,”.
(3)For subsection (10) (meaning of “qualifying course of vocational training”) there shall be substituted—
“(10)In this section “qualifying course of vocational training” means—
(a)any programme of activity capable of counting towards a qualification—
(i)accredited as a National Vocational Qualification by the National Council for Vocational Qualifications; or
(ii)accredited as a Scottish Vocational Qualification by the Scottish Vocational Education Council; or
(b)any course of training which—
(i)satisfies the conditions set out in the paragraphs of section 589(1) of the Taxes Act 1988 (qualifying courses of training etc),
(ii)requires participation on a full-time or substantially full-time basis, and
(iii)extends for a period which consists of or includes four consecutive weeks,
but treating any time devoted to study in connection with the course as time devoted to the practical application of skills or knowledge.”
(4)This section applies to payments made on or after 6th May 1996.]
Textual Amendments
F2S. 144 repealed (27.7.1999 with effect as mentioned in Sch. 20 Pt. III(15), Note of the amending Act) by 1999 c. 16, s. 139, Sch. 20 Pt. III(15)
Marginal Citations
(1)In section 278(2)(a) of the Taxes Act 1988 (exclusion of non-residents from entitlement to personal reliefs not to apply to Commonwealth citizens or citizens of the Republic of Ireland), for “a citizen of the Republic of Ireland” there shall be substituted “ an EEA national ”.
(2)After subsection (8) of that section (claims to be made to the Board) there shall be added the following subsection—
“(9)In this section “EEA national” means a national of any State, other than the United Kingdom, which is a Contracting Party to the Agreement on the European Economic Area signed at Oporto on 2nd May 1992, as adjusted by the Protocol signed at Brussels on 17th March 1993.”
(3)This section has effect for the year 1996-97 and subsequent years of assessment.
(1)Section 505(1) of the Taxes Act 1988 (exemptions for charities) shall be amended as follows.
(2)For paragraph (a) (rents etc.) there shall be substituted the following paragraph—
“(a)exemption from tax under Schedules A and D in respect of any profits or gains arising in respect of rents or other receipts from an estate, interest or right in or over any land (whether situated in the United Kingdom or elsewhere) to the extent that the profits or gains—
(i)arise in respect of rents or receipts from an estate, interest or right vested in any person for charitable purposes; and
(ii)are applied to charitable purposes only;”.
(3)For sub-paragraph (ii) of paragraph (c) (yearly interest and annual payments) there shall be substituted the following sub-paragraphs—
“(ii)from tax under Case III of Schedule D,
(iia)from tax under Case IV or V of Schedule D in respect of income equivalent to income chargeable under Case III of that Schedule but arising from securities or other possessions outside the United Kingdom,
(iib)from tax under Case V of Schedule D in respect of income consisting in any such dividend or other distribution of a company not resident in the United Kingdom as would be chargeable to tax under Schedule F if the company were so resident, and”.
(4)In paragraph (e) (trading profits), after “by a charity” there shall be inserted “ (whether in the United Kingdom or elsewhere) ”.
(5)This section has effect—
(a)for the purposes of income tax, for the year 1996-97 and subsequent years of assessment; and
(b)for the purposes of corporation tax, in relation to accounting periods ending after 31st March 1996.
(1)In section 617 of the Taxes Act 1988 (social security benefits and contributions), subsection (5) (relief for Class 4 contributions) shall cease to have effect.
(2)In consequence of the provision made by subsection (1) above, in paragraph 3(2) of Schedule 2 to—
(a)the M2Social Security Contributions and Benefits Act 1992, and
(b)the M3Social Security Contributions and Benefits (Northern Ireland) Act 1992,
the words “ (e) section 617(5) (relief for Class 4 contributions); ” shall be omitted.
(3)This section shall have effect in relation to the year 1996-97 and subsequent years of assessment.
(1)Income tax shall not be chargeable on any payment falling within subsection (3) or (5) below.
(2)Receipt of a payment falling within subsection (3) below shall not be regarded for the purposes of capital gains tax as the disposal of an asset.
(3)A payment falls within this subsection if it is a capital sum by way of compensation for loss suffered, or reasonably likely to be suffered, by a person in a case where that person, or some other person, acting in reliance on bad investment advice at least some of which was given during the period beginning with 29th April 1988 and ending with 30th June 1994,—
(a)has, while eligible, or reasonably likely to become eligible, to be a member of an occupational pension scheme, instead become a member of a personal pension scheme or entered into a retirement annuity contract;
(b)has ceased to be a member of, or to pay contributions to, an occupational pension scheme and has instead become a member of a personal pension scheme or entered into a retirement annuity contract;
(c)has transferred to a personal pension scheme accrued rights of his under an occupational pension scheme; or
(d)has ceased to be a member of an occupational pension scheme and has instead (by virtue of such a provision as is mentioned in section 591(2)(g) of the Taxes Act 1988) entered into arrangements for securing relevant benefits by means of an annuity contract.
(4)A payment chargeable to income tax apart from subsection (1) above may nevertheless be regarded as a capital sum for the purpose of determining whether it falls within subsection (3) above.
(5)A payment falls within this subsection if and to the extent that it is a payment of interest, on the whole or any part of a capital sum such as is mentioned in subsection (3) above, for a period ending on or before the earliest date on which a determination (whether or not subsequently varied on an appeal or in any other proceedings) of the amount of the particular capital sum in question is made, whether by agreement or by a decision of—
(a)a court, tribunal or commissioner,
(b)an arbitrator or (in Scotland) arbiter, or
(c)any other person appointed for the purpose.
(6)In this section—
“bad investment advice” means investment advice in respect of which an action against the person who gave it has been, or may be, brought—
in or for negligence;
for breach of contract;
by reason of a breach of a fiduciary obligation; or
[F3by reason of a contravention which is actionable—
under section 62 of the Financial Services Act 1986; or
under section 150 of the Financial Services and Markets Act 2000;]
[F4“investment advice”—
in relation to a time before 1st December 2001, means advice such as is mentioned in paragraph 15 of Schedule 1 to the Financial Services Act 1986; and
in relation to a time on or after that date, means advice such as is mentioned in Article 53 of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001;]
“occupational pension scheme” means—
a scheme approved, or being considered for approval, under Chapter I of Part XIV of the Taxes Act 1988 (retirement benefit schemes);
a relevant statutory scheme, as defined in section 611A(1) of that Act; or
a fund to which section 608 of that Act applies (superannuation funds approved before 6th April 1980 etc);
“personal pension scheme” has the meaning given by section 630(1) of the Taxes Act 1988;
“relevant benefits” has the meaning given by section 612(1) of the Taxes Act 1988;
“retirement annuity contract” means a contract made before 1st July 1988 and approved by the Board under or by virtue of any provision of Chapter III of Part XIV of the Taxes Act 1988.
[F5(6A)References in subsections (3)(d) and (6) to provisions of Part 14 of the Taxes Act 1988 are to those provisions as they had effect at the time in question.]
(7)This section shall have effect, and be taken always to have had effect, in relation to any payment falling within subsection (3) or (5) above, whether made before or after the passing of this Act.
Textual Amendments
F3S. 148(6): para. (d) in the definition of “bad investment advice” substituted (1.12.2001) by S.I. 2001/3629, art. 93(2)
F4S. 148(6): definition of “investment advice” substituted (1.12.2001) by S.I. 2001/3629, art. 93(3)
F5S. 148(6A) inserted (6.4.2006) by Finance Act 2004 (c. 12), s. 284(1), Sch. 35 para. 44 (with Sch. 36)
(1)Section 347A of the Taxes Act 1988 (annual payments not a charge on the income of a payer) shall apply to any payment made on or after 6th April 1996—
(a)in pursuance of any obligation which falls within section 36(4)(a) of the M4Finance Act 1988 (existing obligations under certain court orders), and
(b)for the benefit, maintenance or education of a person (whether or not the person to whom the payment is made) who attained the age of 21 before 6th April 1994,
as if that obligation were not an existing obligation within the definition contained in section 36(4) of the Finance Act 1988.
(2)Subsection (1) above does not apply to any payment to which section 38 of the Finance Act 1988 (treatment of certain maintenance payments under existing obligations) applies.]
Textual Amendments
F6S. 149 repealed (27.7.1999 with effect as mentioned in Sch. 20 Pt. III(6), Note of the amending Act) by 1999 c. 16, s. 139, Sch. 20 Pt. III(6)
Marginal Citations
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Textual Amendments
(1)The Treasury may by order make provision for the Income Tax Acts to have effect in relation to any amount of benefit payable by virtue of a Government pilot scheme as if it was, as they think fit, either—
(a)wholly or partly exempt from income tax and, accordingly, to be disregarded in computing the amount of any receipts brought into account for income tax purposes; or
(b)to the extent specified in the order, to be brought into account for the purposes of income tax as income of a description so specified or as a receipt of a description so specified.
(2)The Treasury may by order provide for any amount of benefit payable by virtue of a Government pilot scheme to be left out of account, to the extent specified in the order, in the determination for the purposes of [F8section 532 of the Capital Allowances Act (exclusion of expenditure met by contributions)] of how far any expenditure has been or is to be met directly or indirectly by the Crown or by an authority or person other than the person actually incurring it.
(3)In this section “Government pilot scheme” means any arrangements (whether or not contained in a scheme) which—
(a)are made, under any enactment or otherwise, by the Secretary of State or any Northern Ireland department;
(b)make provision for or about the payment of amounts of benefit either—
(i)for purposes that are similar to those for which any social security or comparable benefit is payable; or
(ii)for purposes connected with the carrying out of any functions of the Secretary of State or any such department in relation to employment or training for employment;
(c)are arrangements relating to a temporary experimental period; and
(d)are made wholly or partly for the purpose of facilitating a decision as to whether, or to what extent, it is desirable for provision to be made on a permanent basis for or in relation to any benefit.
(4)In subsection (3)(b) above the reference to making provision for or about the payment of amounts of benefit for purposes that are similar to those for which any social security or comparable benefit is payable shall include a reference to making provision by virtue of which there is a modification of the conditions of entitlement to, or the conditions for the payment of, an existing social security or comparable benefit.
(5)An order under this section may—
(a)make different provision for different cases, and
(b)contain such incidental, supplemental, consequential and transitional provision (including provision modifying provision made by or under the Income Tax Acts) as the Treasury may think fit.
(6)In this section “benefit” includes any allowance, grant or other amount the whole or any part of which is payable directly or indirectly out of public funds.
(7)The power to make an order under this section—
(a)shall be exercisable for the year 1996-97 and subsequent years of assessment; and
(b)so far as exercisable for the year 1996-97, shall be exercisable in relation to benefits, allowances and other amounts paid at times on or after 6th April 1996 but before the making of the order.
(8)The Treasury shall not make an order under this section containing any such provision as is mentioned in subsection (1)(b) above unless a draft of the order has been laid before, and approved by a resolution of, the House of Commons.
Textual Amendments
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Textual Amendments
F9S. 152 repealed (with effect in accordance with s. 723(1)(a)(b) of the amending Act) by Income Tax (Earnings and Pensions) Act 2003 (c. 1), s. 723, Sch. 8 Pt. 1 (with Sch. 7)
Schedule 27 to this Act (which makes provision relating to foreign income dividends) shall have effect.
(1)The modifications which, under section 60 of the M5Finance Act 1940, may be made for the purposes of any issue of securities to the conditions about tax exemption specified in section 22 of the M6Finance (No. 2) Act 1931 shall include a modification by virtue of which the tax exemption contained in any condition of the issue applies, as respects capital, irrespective of where the person with the beneficial ownership of the securities is domiciled.
(2)Subject to subsections [F10(3) and] (5) below, nothing in the Tax Acts shall impose any charge to tax on any person in respect of so much of any profits or gains arising from a FOTRA security, or from any loan relationship represented by a FOTRA security, as is expressed to be exempt from tax in the tax exemption condition applying to that security. [F11This does not apply to any charge to income tax (but see sections 714 and 715 of the Income Tax (Trading and Other Income) Act 2005 for exemptions from income tax charges).]
(3)Exemption from tax shall not be conferred by virtue of subsection (2) above in relation to any security unless the requirements imposed as respects that exemption by the conditions with which the security is issued (including any requirement as to the making of a claim) are complied with.
F12(4). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(5)Nothing in this section shall entitle any person to any repayment of tax which he has not claimed within the time limit which would be applicable under the Tax Acts (apart from this section) to a claim for the repayment of that tax.
(6)A person with the beneficial ownership of a FOTRA security who would, by virtue of this section, be exempt from tax in respect of some or all of the profits and gains arising from that security, or from any loan relationship represented by it, shall not be entitled for the purposes of F13... corporation tax to bring into account any amount—
(a)in respect of changes in the value of that security;
(b)as expenses or disbursements incurred in, or in connection with, the holding of the security or any transaction relating to the security; or
(c)as a debit given, in respect of any loan relationship represented by that security, by any provision of Chapter II of this Part of this Act in respect of such a relationship.
(7)Schedule 28 to this Act (which contains amendments consequential on the provisions of this section) shall have effect.
(8)References in this section to a FOTRA security are references to—
(a)any security issued with such a condition about exemption from taxation as is authorised in relation to its issue by virtue of section 22 of the M7Finance (No. 2) Act 1931; or
(b)any 3½% War Loan 1952 Or After which was issued with a condition authorised by virtue of section 47 of the M8Finance (No. 2) Act 1915;
and references, in relation to such a security, to the tax exemption condition shall be construed accordingly.
(9)This section and Schedule 28 to this Act shall have effect—
(a)for the purposes of income tax, for the year 1996-97 and subsequent years of assessment; and
(b)for the purposes of corporation tax, for accounting periods ending after 31st March 1996.
Textual Amendments
F10Words in s. 154(2) substituted (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 488(2)(a) (with Sch. 2)
F11Words in s. 154(2) inserted (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 488(2)(b) (with Sch. 2)
F12S. 154(4) repealed (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 488(3), Sch. 3 (with Sch. 2)
F13Words in s. 154(6) repealed (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 488(4), Sch. 3 (with Sch. 2)
Marginal Citations
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Textual Amendments
F14S. 155 repealed (6.4.2007) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 3 Pt. 1 (with Sch. 2)
Schedule 29 to this Act (which amends the rules relating to paying and collecting agents) shall have effect.
(1)After section 129A of the Taxes Act 1988 (interest on cash collateral paid in connection with stock lending arrangements) there shall be inserted the following section—
(1)The income which, as income deriving from investments of a description specified in any of the relevant provisions, is eligible for relief from tax by virtue of that provision shall be taken to include any relevant stock lending fee.
(2)For the purposes of this section the relevant provisions are sections 592(2), 608(2)(a), 613(4), 614(3), 620(6) and 643(2).
(3)In this section “relevant stock lending fee”, in relation to investments of any description, means any amount, in the nature of a fee, which is payable in connection with an approved stock lending arrangement relating to investments which, but for any transfer under the arrangement, would be investments of that description.
(4)In this section “approved stock lending arrangement” has the same meaning as in Schedule 5A.”
(2)This section has effect in relation to any arrangements entered into on or after 2nd January 1996.
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Textual Amendments
F15S. 158 repealed (6.4.2007) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 3 Pt. 1 (with Sch. 2)
(1)Sections 729, 737A(2)(b) and 786(4) of the Taxes Act 1988 (provisions applying to sale and repurchase agreements) shall cease to have effect except in relation to cases where the initial agreement to sell or transfer the securities or other property was made before the appointed day.
[F16(2)In section 737 of that Act—
(a)in subsection (5) (manufactured dividends paid to UK residents by non-residents), for the words from “a person resident in the United Kingdom” to “the United Kingdom recipient shall” there shall be substituted “ a United Kingdom recipient, that recipient shall ”; and
(b)after that subsection there shall be inserted the following subsection—
“(5AAA)For the purposes of subsection (5) above a person who receives a manufactured dividend is a United Kingdom recipient if—
(a)he is resident in the United Kingdom; or
(b)he is not so resident but receives that dividend for the purposes of a trade carried on through a branch or agency in the United Kingdom.”
F16(3)In section 737C of that Act (deemed manufactured payments), the following subsection shall be inserted after subsection (11A) in relation to cases where the initial agreement to sell the securities is made on or after the appointed day, that is to say—
“(11B)The preceding provisions of this section shall have effect in cases where paragraph 2, 3 or 4 of Schedule 23A would apply by virtue of section 737A(5) but for paragraph 5 of that Schedule as they have effect in a case where the paragraph in question is not disapplied by paragraph 5; and where—
(a)the gross amount of the deemed manufactured interest, or
(b)the gross amount of the deemed manufactured overseas dividend,
falls to be calculated in such a case under subsection (8) or (11) above, it shall be so calculated by reference to the provisions of paragraph 3 or 4 of Schedule 23A that would have applied but for paragraph 5 of that Schedule.”]
F17(4). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F17(5). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F17(6). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(7)In sub-paragraph (1) of paragraph 8 of that Schedule (power to modify provisions of Schedule)—
(a)before the “or” at the end of paragraph (a) there shall be inserted—
“(aa)such persons who receive, or become entitled to receive, manufactured dividends, manufactured interest or manufactured overseas dividends as may be prescribed,”
[F18and
(b)in the words after paragraph (b), for “paragraph 2, 3 or 4 above” there shall be substituted “ paragraphs 2 to 5 above ”.]
(8)After sub-paragraph (1) of paragraph 8 of that Schedule there shall be inserted the following sub-paragraph—
“(1A)Dividend manufacturing regulations may provide, in relation to prescribed cases where a person makes or receives the payment of any amount representative of an overseas dividend, or is treated for any purposes of this Schedule or such regulations as a person making or receiving such a payment—
(a)for any entitlement of that person to claim relief under Part XVIII to be extinguished or reduced to such extent as may be found under the regulations; and
(b)for the adjustment, by reference to any provision having effect under the law of a territory outside the United Kingdom, of any amount falling to be taken, for any prescribed purposes of the Tax Acts or the 1992 Act, to be the amount paid or payable by or to any person in respect of any sale, repurchase or other transfer of the overseas securities to which the payment relates.”
(9)Subsections (2), (4) and (5) above have effect—
(a)for the purposes of corporation tax, in relation to accounting periods ending after 31st March 1996; and
(b)for the purposes of income tax, in relation to the year 1996-97 and subsequent years of assessment.
(10)In this section “the appointed day” means such day as the Treasury may by order appoint, and different days may be appointed under this subsection for different purposes.
Textual Amendments
F16S. 159(2)(3) repealed (19.3.1997 with effect as mentioned in Sch. 18 Pt. VI(10), Note 1) by 1997 c. 16, s. 113, Sch. 18 Pt. VI(10); S.I. 1997/991, art. 2
F17S. 159(4)-(6) repealed (6.4.2007) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 3 Pt. 1 (with Sch. 2)
F18S. 159(7)(b) and the preceding word “and” repealed (19.3.1997 with effect as mentioned in Sch. 18 Pt. VI(10), Note 1) by 1997 c. 16, s. 113, Sch. 18 Pt. VI(10); S.I. 1997/991, art. 2
Schedule 30 to this Act (which makes provision conferring relief from corporation tax on companies that invest in housing) shall have effect.]
Textual Amendments
F19S. 160 ceased to have effect (with effect in accordance with s. 145(2) of the amending Act) by virtue of Finance Act 2006 (c. 25), s. 143
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Textual Amendments
F20S. 161 repealed (6.4.2007) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 3 Pt. 1 (with Sch. 2)
(1)Section 55 of the M9Finance Act 1995 (removal of certification requirements for qualifying policies with respect to any time on or after 5th May 1996 etc) shall have effect—
(a)with the substitution for “5th May 1996”, wherever occurring, of “the appointed date”; and
(b)with the addition of the following subsection after subsection (8)—
“(9)In this section “the appointed date” means such date as may be specified for the purpose in an order made by the Board.”
(2)In Schedule 15 to the Taxes Act 1988 (qualifying policies) paragraphs 24(2A) and 25(2) shall have effect with the substitution for “5th May 1996” of “ the appointed date for the purposes of section 55 of the Finance Act 1995 (removal of certification requirements) ”.
Schedule 31 to this Act, which makes provision about losses arising to insurance companies in the carrying on of life assurance business, shall have effect.
F21(1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F22(2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F23(3). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(4)In section 56(4) of the Taxes Act 1988 (which contains a reference to the computation required by section 76(2) of that Act), for “by” there shall be substituted “ for the purposes of ”.
(5)Subject to subsection (6) below, this section has effect in relation to accounting periods beginning on or after 1st January 1996.
F24(6). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textual Amendments
F21S. 164(1) repealed (with effect in accordance with s. 42 of the amending Act) by Finance Act 2004 (c. 12), Sch. 42 Pt. 2(3)
F22S. 164(2) repealed (with effect in accordance with s. 42 of the amending Act) by Finance Act 2004 (c. 12), Sch. 42 Pt. 2(3)
F23S. 164(3) repealed (with effect in accordance with reg. 1 of the amending S.I.) by The Overseas Life Insurance Companies Regulations 2006 (S.I. 2006/3271), reg. 1, Sch. Pt. 1
F24S. 164(6) repealed (with effect in accordance with s. 42 of the amending Act) by Finance Act 2004 (c. 12), Sch. 42 Pt. 2(3)
(1)In section 337 of the Taxes Act 1988 (deductions in computing income), the following subsections shall be inserted after subsection (2)—
“(2A)In computing any profits or losses of a company in accordance with the provisions of this Act applicable to Case I of Schedule D, subsection (2)(b) above shall not prevent the deduction of any annuity or other annual payment which is payable by a company wholly or partly in satisfaction of any claim under an insurance policy in relation to which the company is the insurer.
(2B)The reference in subsection (2A) above to an annuity payable wholly or partly in satisfaction of a claim under an insurance policy shall be taken, in relation to an insurance company (within the meaning of Chapter I of Part XII), to include a reference to every annuity payable by that company; and the references in sections 338(2) and 434B(2) to an annuity paid wholly or partly as mentioned in subsection (2A) above shall be construed accordingly.”
(2)In section 338(2) of that Act, in the words after paragraph (b) (payments which are not charges on income), after “corporation tax” there shall be inserted “ nor any annuity or other annual payment which (without being so deductible) is paid wholly or partly as mentioned in section 337(2A) ”.
[F25(3)In section 434B of that Act (treatment of interest and annuities in the case of insurance companies), subsection (1) shall cease to have effect; and in subsection (2), for the words from the beginning to “mentioned in subsection (1) above” there shall be substituted—
“(2)Nothing in section 337(2A) or 338(2) shall be construed as preventing any annuity or other annual payment which is paid wholly or partly as mentioned in section 337(2A)”.]
(4)Subject to subsection (5) below, this section has effect in relation to accounting periods beginning on or after 1st January 1996.
(5)In relation to any accounting period beginning on or after 1st January 1996 but ending before 1st April 1996, this section shall have effect as if any reference in provisions inserted by this section to an annuity payable or paid by an insurance company included a reference to any such interest as was mentioned in section 434B(1) of the Taxes Act 1988 before its repeal by virtue of this section.
Textual Amendments
F25s. 165(3) repealed (19.3.1997 with effect as mentioned in Sch. 18 Pt. VI(6), Note) by 1997 c. 16, s. 113, Sch. 18 Pt. VI(6)
Schedule 32 to this Act (which makes provision about the tax treatment of equalisation reserves maintained by insurance companies) shall have effect.
(1)In section 432 of the Taxes Act 1988, subsection (2) (industrial assurance business treated as separate business for the purposes of Chapter I of Part XII) shall cease to have effect.
F26(2). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(3)In section 86 of the M10Finance Act 1989 (spreading of relief for acquisition expenses)—
(a)in subsection (1)(a), for “in respect of industrial life assurance business carried on by the company” there shall be substituted “ for persons who collect premiums from house to house ”; and
(b)in subsection (2), for “in respect of industrial life assurance business” there shall be substituted “ for persons who collect premiums from house to house ”.
F27(4). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(5)In Schedule 14 to the Taxes Act 1988 (ancillary provisions about relief in respect of life assurance premiums), in paragraph 8, at the beginning of sub-paragraph (4) (policy which is varied so as to increase benefits, etc. to be treated as issued after 13th March 1984) there shall be inserted “ Subject to sub-paragraph (8) below, ”.
(6)After sub-paragraph (7) of that paragraph there shall be inserted the following sub-paragraph—
“(8)Sub-paragraph (4) above does not apply in the case of a variation so as to increase the benefits secured, if the variation is made—
(a)on or after such day as the Board may by order appoint, and
(b)in consideration of a change in the method of payment of premiums from collection by a person collecting premiums from house to house to payment by a different method.”
(7)In Schedule 15 to the Taxes Act 1988 (qualifying policies)—
(a)in paragraph 1(6) (calculation of amount included in premiums of whole life and term insurances in respect of their payment otherwise than annually), for “and if the policy is issued in the course of an industrial assurance business,” there shall be substituted “ sand if the policy provides for payment otherwise than annually without providing for the amount of the premiums if they are paid annually, ”; and
(b)in paragraph 2(2) (the equivalent calculation for endowment assurances), for “issued in the course of an industrial assurance business” there shall be substituted “ that provides for the payment of premiums otherwise than annually without providing for the amount of the premiums if they are paid annually, ”.
(8)After paragraph 8 of that Schedule there shall be inserted the following paragraph—
“8A(1)Paragraphs 7 and 8 above shall have effect in relation to any policy issued on or after the appointed day as if the references to the issue of a policy in the course of an industrial assurance business were references to the issue of a policy by any company in a case in which—
(a)the company, before that day and in the course of such a business, issued any policy which was a qualifying policy by virtue of either of those paragraphs; and
(b)the policies which on 28th November 1995 were being offered by the company as available to be issued included policies of the same description as the policy issued on or after the appointed day.
(2)In this paragraph “the appointed day” means such day as the Board may by order appoint.”
(9)In paragraph 18(3) of that Schedule (certain variations of a policy not to affect whether policy is a qualifying policy), after paragraph (b) there shall be inserted “or
(c)any variation so as to increase the benefits secured or reduce the premiums payable which is effected—
(i)on or after such day as the Board may by order appoint, and
(ii)in consideration of a change in the method of payment of premiums from collection by a person collecting premiums from house to house to payment by a different method.”
(10)Subsections (1) to (3) above have effect in relation to accounting periods beginning on or after 1st January 1996.
(11)Subsection (4) above shall come into force on such day as the Board may by order appoint.
(12)Subsection (7) above shall have effect in relation to policies issued on or after such day as the Board may by order appoint.
Subordinate Legislation Made
P1S. 167(11)(12) power fully exercised: 1.12.2001 appointed by S.I. 2001/3643, art. 2(a)
Textual Amendments
F26S. 167(2) repealed (with effect in accordance with s. 38 of the amending Act) by Finance Act 2007 (c. 11), Sch. 27 Pt. 2(7)
F27S. 167(4) repealed (6.4.2007) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 3 Pt. 1 (with Sch. 2)
Marginal Citations
F28(1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(2)Schedule 33 to this Act (which makes provision for the application of the I minus E basis of charging tax to companies carrying on capital redemption business) shall have effect.
F28(3). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(4)In section 539(3) of that Act, in the definition of “capital redemption policy” for “insurance” there shall be substituted “contract”.
(5)In section 553(10) of that Act, in paragraph (a) of the definition of “new offshore capital redemption policy”, for “an insurance” there shall be substituted “a contract”.
(6)Subsection (1) above shall have effect as respects accounting periods ending on or after the day appointed under section 199 of the M11Finance Act 1994 for the purposes of Chapter III of Part IV of that Act (self-assessment management provisions), and subsections (4) and (5) above shall have effect as respects contracts effected on or after that day.
Textual Amendments
F28S. 168(1)(3) repealed (with effect in accordance with s. 38 of the amending Act) by Finance Act 2007 (c. 11), Sch. 27 Pt. 2(7)
Marginal Citations
Textual Amendments
F29S. 169 repealed (11.5.2001 with effect as mentioned in Sch. 33 Pt. 2(12), Note of the amending Act) by 2001 c. 9, s. 110, Sch. 33 Pt. 2(12)
(1)After section 11AB of the M12Taxes Management Act 1970 there shall be inserted the following sections—
(1)This section applies in any case where a company carrying on insurance business in any period delivers a return for that period under section 11 of this Act which is based wholly or partly on accounts which the company is required or permitted to draw up using the method described in paragraph 52 of Schedule 9A to the M13Companies Act 1985 (accounting for general insurance business on a non-annual basis).
(2)Where this section applies, section 11AA(2) of this Act shall have effect as if after paragraph (b) there were added “and
(c1)where a company has delivered a return which is based wholly or partly on accounts drawn up as mentioned in section 11AC(1) of this Act, then, at any time before the end of the period of twelve months beginning with the date on which any particular technical provision constituted in the case of those accounts as described in paragraph 52 of Schedule 9A to the M14Companies Act 1985 is replaced as described in sub-paragraph (4) of that paragraph, the company may by notice to an officer of the Board so amend its self-assessment as to give effect to any amendments to the return—
(i)which arise from the replacement of that technical provision, and
(ii)which the company has notified to such an officer.”
(3)Where this section applies, section 11AB of this Act shall have effect—
(a)as if in subsection (1)(b) after “subsection (2)(b)” there were inserted “or (c1)”; and
(b)as if in subsection (2) for the words from “is” to the end of paragraph (b) there were substituted—
“(a1)in the case of a return (whenever delivered) which is based wholly or partly on accounts drawn up as mentioned in section 11AC(1) of this Act, is whichever of the following periods ends the later, that is to say—
(i)the period of two years beginning with the date (or, if there is more than one such date, the latest date) on which any technical provision constituted in the case of those accounts as described in paragraph 52 of Schedule 9A to the Companies Act 1985 is replaced as mentioned in sub-paragraph (4) of that paragraph; or
(ii)the period ending with the quarter day next following the first anniversary of the day on which the return was delivered; and
(b1)in the case of an amendment of such a return—
(i)if the amendment is made on or before the filing date, is the period of twelve months beginning with that date; or
(ii)if the amendment is made after that date, is the period ending with the quarter day next following the first anniversary of the day on which the amendment was made;”.
(1)This section applies in any case where a return under section 11 of this Act is delivered by an insurance company which is permitted by an order under section 68 of the M15Insurance Companies Act 1982 to cause investigations to be made into its financial condition less frequently than is required by section 18 of that Act.
(2)Where this section applies, section 11AA(2) of this Act shall have effect as if, after paragraph (b), there were added “and
(c2)where a company falling within section 11AD(1) of this Act has delivered a return for any period, then, at any time before the end of the period of twelve months beginning with the date as at which the relevant investigation is carried out, that is to say—
(i)if the return is for a period as at the end of which there is carried out an investigation under section 18 of the M16Insurance Companies Act 1982 into the financial condition of the company, that investigation, or
(ii)if the return is not for such a period, the first such investigation to be made into the financial condition of the company as at the end of a subsequent period,
the company may by notice to an officer of the Board so amend its self-assessment as to give effect to any amendments to its return which arise from that investigation and which the company has notified to such an officer.”
(3)Where this section applies, section 11AB of this Act shall have effect—
(a)as if in subsection (1)(b) after “subsection (2)(b)” there were inserted “or (c2)”; and
(b)as if in subsection (2) for the words from “is” to the end of paragraph (b) there were substituted—
“(a2)in the case of a return delivered at any time by a company falling within section 11AD(1) of this Act, is the period of two years beginning with the date as at which the relevant investigation, as defined in section 11AA(2)(c2) of this Act, is carried out; and
(b2)in the case of an amendment of such a return—
(i)if the amendment is made on or before the filing date, is the period of twelve months beginning with that date; or
(ii)if the amendment is made after that date, is the period ending with the quarter day next following the first anniversary of the day on which the amendment was made;”.
(1)This section applies in any case where a return under section 11 of this Act is delivered by a friendly society which is required by section 47 of the M17Friendly Societies Act 1992 to cause an investigation to be made into its financial condition at least once in every period of three years.
(2)Where this section applies, section 11AA(2) of this Act shall have effect as if, after paragraph (b), there were added “and
(c3)where a friendly society falling within section 11AE(1) of this Act has delivered a return for any period, then, at any time before the end of the period of fifteen months beginning with the date as at which the relevant investigation is carried out, that is to say—
(i)if the return is for a period as at the end of which there is carried out an investigation under section 47 of the M18Friendly Societies Act 1992 into the financial condition of the society, that investigation, or
(ii)if the return is not for such a period, the first such investigation to be made into the financial condition of the society as at the end of a subsequent period,
the society may by notice to an officer of the Board so amend its self-assessment as to give effect to any amendments to its return which arise from that investigation and which the society has notified to such an officer.”
(3)Where this section applies, section 11AB of this Act shall have effect—
(a)as if in subsection (1)(b) after “subsection (2)(b)” there were inserted “or (c3)”; and
(b)as if in subsection (2) for the words from “is” to the end of paragraph (b) there were substituted—
“(a3)in the case of a return delivered at any time by a friendly society falling within section 11AE(1) of this Act, is the period of twenty seven months beginning with the date as at which the relevant investigation, as defined in section 11AA(2)(c3) of this Act, is carried out; and
(b3)in the case of an amendment of such a return—
(i)if the amendment is made on or before the filing date, is the period of twelve months beginning with that date; or
(ii)if the amendment is made after that date, is the period ending with the quarter day next following the first anniversary of the day on which the amendment was made;”.”
(2)The amendment made by subsection (1) above shall have effect as respects accounting periods ending on or after the day appointed under section 199 of the M19Finance Act 1994 for the purposes of Chapter III of Part IV of that Act (self-assessment management provisions).]
Textual Amendments
F30S. 170 repealed (31.7.1998 with effect as mentioned in Sch. 27 Pt. III(28), Note) by 1998 c. 36, s. 165, Sch. 27 Pt. III(28)
Marginal Citations
(1)In section 466 of the Taxes Act 1988 (interpretation of Chapter II of Part XII) for subsection (1) (meaning of “life or endowment business”) there shall be substituted—
“(1)In this Chapter “life or endowment business” means, subject to subsections (1A) and (1B) below,—
(a)any business within Class I, II or III of Head A of Schedule 2 to the M20Friendly Societies Act 1992;
(b)pension business;
(c)any other life assurance business;
(d)any business within Class IV of Head A of that Schedule, if—
(i)the contract is one made before 1st September 1996; or
(ii)the contract is one made on or after 1st September 1996 and the effecting and carrying out of the contract also constitutes business within Class I, II or III of Head A of that Schedule.
(1A)Life or endowment business does not include the issue, in respect of a contract made before 1st September 1996, of a policy affording provision for sickness or other infirmity (whether bodily or mental), unless—
(a)the policy also affords assurance for a gross sum independent of sickness or other infirmity;
(b)not less than 60 per cent. of the amount of the premiums is attributable to the provision afforded during sickness or other infirmity; and
(c)there is no bonus or addition which may be declared or accrue upon the assurance of the gross sum.
(1B)Life or endowment business does not include the assurance of any annuity the consideration for which consists of sums obtainable on the maturity, or on the surrender, of any other policy of assurance issued by the friendly society, being a policy of assurance forming part of the tax exempt life or endowment business of the friendly society.”
(2)In subsection (2) of that section (other definitions) there shall be inserted at the appropriate places—
“(a)“insurance company” shall be construed in accordance with section 431;”; and
“(b)“long term business” shall be construed in accordance with section 431;”.
F31(3). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
F31(4). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(5)In section 463(1) of that Act (Corporation Tax Acts to apply to friendly societies’ life or endowment business as they apply to insurance companies’ mutual life assurance business) after “mutual life assurance business” there shall be inserted “ (or other long term business) ”.
(6)The amendment made by subsection (5) above shall have effect in relation to accounting periods ending on or after 1st September 1996.
Textual Amendments
F31S. 171(3)(4) repealed (6.4.2007) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 3 Pt. 1 (with Sch. 2)
Marginal Citations
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textual Amendments
F32S. 172 repealed (6.4.2006) by Finance Act 2004 (c. 12), Sch. 42 Pt. 3 (with Sch. 36)
(1)Section 419 of the Taxes Act 1988 (loans to participators etc.) shall be amended in accordance with subsections (2) to (4) below.
(2)For subsection (3) (time when tax becomes due) there shall be substituted the following subsection—
“(3)Tax due by virtue of this section in relation to any loan or advance shall be due and payable on the day following the expiry of nine months from the end of the accounting period in which the loan or advance was made.”
(3)After subsection (4) (relief in respect of repayment) there shall be inserted the following subsection—
“(4A)Where the repayment of the whole or any part of a loan or advance occurs on or after the day on which tax by virtue of this section becomes due in relation to that loan or advance, relief in respect of the repayment shall not be given under subsection (4) above at any time before the expiry of nine months from the end of the accounting period in which the repayment occurred.”
(4)In subsection (6) (application to loans and advances to certain companies who are participators etc.), the words “ and to a company not resident in the United Kingdom ” shall be omitted.
(5)In section 826(4) of that Act (interest on repayment of tax by virtue of section 419), for paragraph (a) there shall be substituted the following paragraph—
“(a)the date when the entitlement to relief in respect of the repayment accrued, that is to say—
(i)where the repayment of the loan or advance (or part thereof) occurred on or after the day mentioned in section 419(4A), the date nine months after the end of that accounting period; and
(ii)in any other case, the date nine months after the end of the accounting period in which the loan or advance was made;
or”.
(6)This section has effect in relation to any loan or advance made in an accounting period ending on or after 31st March 1996.
(1)Section 13 of the M21Taxation of Chargeable Gains Act 1992 (attribution of gains to members of non-resident companies) shall be amended in accordance with subsections (2) to (9) below.
(2)In subsection (2) (persons subject to charge on gain to company), for “holds shares” there shall be substituted “ is a participator ”.
(3)For subsections (3) and (4) (part of gain attributed to person subject to charge) there shall be substituted the following subsections—
“(3)That part shall be equal to the proportion of the gain that corresponds to the extent of the participator’s interest as a participator in the company.
(4)Subsection (2) above shall not apply in the case of any participator in the company to which the gain accrues where the aggregate amount falling under that subsection to be apportioned to him and to persons connected with him does not exceed one twentieth of the gain.”
(4)In subsection (5), paragraph (a) (section not to apply where gain distributed within two years) shall be omitted; and after that subsection there shall be inserted the following subsection—
“(5A)Where—
(a)any amount of capital gains tax is paid by a person in pursuance of subsection (2) above, and
(b)an amount in respect of the chargeable gain is distributed (either by way of dividend or distribution of capital or on the dissolution of the company) within 2 years from the time when the chargeable gain accrued to the company,
that amount of tax (so far as neither reimbursed by the company nor applied as a deduction under subsection (7) below) shall be applied for reducing or extinguishing any liability of that person to income tax in respect of the distribution or (in the case of a distribution falling to be treated as a disposal on which a chargeable gain accrues to that person) to any capital gains tax in respect of the distribution.”
(5)In subsection (7) (deduction of tax paid in computing gain on shares in the company)—
(a)for “not reimbursed by the company)” there shall be inserted “ neither reimbursed by the company nor applied under subsection (5A) above for reducing any liability to tax) ”; and
(b)for “the shares by reference to which the tax was paid” there shall be substituted “ any asset representing his interest as a participator in the company. ”
(6)After subsection (7) there shall be inserted the following subsection—
“(7A)In ascertaining for the purposes of subsection (5A) or (7) above the amount of capital gains tax or income tax chargeable on any person for any year on or in respect of any chargeable gain or distribution—
(a)any such distribution as is mentioned in subsection (5A)(b) above and falls to be treated as income of that person for that year shall be regarded as forming the highest part of the income on which he is chargeable to tax for the year;
(b)any gain accruing in that year on the disposal by that person of any asset representing his interest as a participator in the company shall be regarded as forming the highest part of the gains on which he is chargeable to tax for that year;
(c)where any such distribution as is mentioned in subsection (5A)(b) above falls to be treated as a disposal on which a gain accrues on which that person is so chargeable, that gain shall be regarded as forming the next highest part of the gains on which he is so chargeable, after any gains falling within paragraph (b) above; and
(d)any gain treated as accruing to that person in that year by virtue of subsection (2) above shall be regarded as the next highest part of the gains on which he is so chargeable, after any gains falling within paragraph (c) above.”
(7)In subsection (9) (cases where person charged is a company)—
(a)for “the person owning any of the shares in the company” there shall be substituted “ a person who is a participator in the company ”; and
(b)for the words from “to the shares” onwards there shall be substituted “ to the participating company’s interest as a participator in the company to which the gain accrues shall be further apportioned among the participators in the participating company according to the extent of their respective interests as participators, and subsection (2) above shall apply to them accordingly in relation to the amounts further apportioned, and so on through any number of companies. ”
(8)In subsection (10) (application to trustees), for “owning shares in the company” there shall be substituted “ who are participators in the company, or in any company amongst the participators in which the gain is apportioned under subsection (9) above, ”.
(9)After subsection (11) there shall be inserted the following subsections—
“(12)In this section “participator”, in relation to a company, has the meaning given by section 417(1) of the Taxes Act for the purposes of Part XI of that Act (close companies).
(13)In this section—
(a)references to a person’s interest as a participator in a company are references to the interest in the company which is represented by all the factors by reference to which he falls to be treated as such a participator; and
(b)references to the extent of such an interest are references to the proportion of the interests as participators of all the participators in the company (including any who are not resident or ordinarily resident in the United Kingdom) which on a just and reasonable apportionment is represented by that interest.
(14)For the purposes of this section, where—
(a)the interest of any person in a company is wholly or partly represented by an interest which he has under any settlement (“his beneficial interest”), and
(b)his beneficial interest is the factor, or one of the factors, by reference to which that person would be treated (apart from this subsection) as having an interest as a participator in that company,
the interest as a participator in that company which would be that person’s shall be deemed, to the extent that it is represented by his beneficial interest, to be an interest of the trustees of the settlement (and not of that person), and references in this section, in relation to a company, to a participator shall be construed accordingly.
(15)Any appeal under section 31 of the Management Act involving any question as to the extent for the purposes of this section of a person’s interest as a participator in a company shall be to the Special Commissioners.”
(10)In paragraph 1(3) of Schedule 5 to the M22Taxation of Chargeable Gains Act 1992 (application of section 86 to section 13 gains)—
(a)in paragraph (a), for “hold shares in a company which originate” there shall be substituted “ are participators in a company in respect of property which originates ”;
(b)in paragraph (b), for “the shares” there shall be substituted “ so much of their interest as participators as arises from that property ”; and
(c)at the end there shall be added—
“Subsections (12) and (13) of section 13 shall apply for the purposes of this sub-paragraph as they apply for the purposes of that section.”
(11)This section applies to gains accruing on or after 28th November 1995.
(1)In section 704 of the Taxes Act 1988 (which relates to the cancellation of tax advantages and specifies the circumstances mentioned in section 703(1)) in paragraph D(2)(b) (companies which do not satisfy the conditions there specified with respect to their shares or stocks) for “are authorised to be dealt in on the Stock Exchange, and are so dealt in (regularly or from time to time)” there shall be substituted “ are listed in the Official List of the Stock Exchange, and are dealt in on the Stock Exchange regularly or from time to time ”.
[F33(2)The reference in paragraph D(2)(b) of section 704 of the Taxes Act 1988 to being listed in the Official List of the Stock Exchange and being dealt in on the Stock Exchange regularly or from time to time shall be taken to include a reference to being dealt in on the Unlisted Securities Market regularly or from time to time, but this subsection is subject to subsection (3) below.
F33(3)Subsection (2) above—
(a)so far as relating to sub-paragraph (2) of paragraph D of section 704 of the Taxes Act 1988 as it applies for the purposes of sub-paragraph (1) of that paragraph or paragraph E of that section, shall not have effect where the relevant transaction takes place after the date on which the Unlisted Securities Market closes;
(b)so far as relating to paragraph D of that section as it applies for the purposes of section 210(3) or 211(2) of that Act (which relate to bonus issues following, and other matters to be treated or not treated as, repayment of share capital) shall not have effect—
(i)in the case of section 210(3), in relation to share capital issued after that date; or
(ii)in the case of section 211(2), in relation to distributions made after that date.]
(4)[F34Except as provided by subsection (3) above,]this section—
(a)so far as relating to sub-paragraph (2) of paragraph D of section 704 of the Taxes Act 1988 as it applies for the purposes of sub-paragraph (1) of that paragraph or paragraph E of that section, shall have effect where the relevant transaction takes place after the passing of this Act; and
(b)so far as relating to paragraph D of that section as it applies for the purposes of section 210(3) or 211(2) of that Act, shall have effect—
(i)in the case of section 210(3), in relation to share capital issued after the passing of this Act; or
(ii)in the case of section 211(2), in relation to distributions made after the passing of this Act.
(5)In this section “the relevant transaction” means—
(a)the transaction in securities mentioned in paragraph (b) of section 703(1) of the Taxes Act 1988, or
(b)the first of the two or more such transactions mentioned in that paragraph,
as the case may be.
Textual Amendments
F33S. 175(2)(3) repealed (with effect as mentioned in Sch. 41 Pt. V(31), Note in the repealing Act) by 1996 c. 8, s. 205, Sch. 41 Pt. V(31)
F34Words in s. 175(4) repealed (with effect as mentioned in Sch. 41 Pt. V(31), Note in the repealing Act) by 1996 c. 8, s. 205, Sch. 41 Pt. V(31)
(1)In each of sections 163 and 164 of, and paragraph 5 of Schedule 6 to, the M23Taxation of Chargeable Gains Act 1992 (retirement relief), for “the age of 55”, wherever occurring, there shall be substituted “ the age of 50 ”.
(2)The amendments made by this section shall apply in relation to disposals on or after 28th November 1995.]
Textual Amendments
F35S. 176 repealed (31.7.1998 with effect as mentioned in Sch. 27 Pt. III(31), Note) by 1998 c. 36, s. 165, Sch. 27 Pt. III(31)
Marginal Citations
Section 164A of the Taxation of Chargeable Gains Act 1992 (re-investment relief) shall have effect, and be deemed always to have had effect, as if the following subsections were inserted after subsection (2)—
“(2A)Where the chargeable gain referred to in subsection (1)(a) above is one which (apart from this section) would be deemed to accrue by virtue of section 116(10)(b)—
(a)any reduction falling to be made by virtue of subsection (2)(a) above shall be treated as one made in the consideration mentioned in section 116(10)(a), instead of in the consideration for the disposal of the asset disposed of; but
(b)if the disposal on which that gain is deemed to accrue is a disposal of only part of the new asset, it shall be assumed, for the purpose only of making a reduction affecting the amount of that gain—
(i)that the disposal is a disposal of the whole of a new asset,
(ii)that the gain accruing on that disposal relates to an old asset consisting in the corresponding part of what was in fact the old asset, and
(iii)that the corresponding part of the consideration deemed to be given for what was in fact the old asset is taken to be the consideration by reference to which the amount of that gain is computed;
and in this subsection “new asset” and “old asset” have the same meanings as in section 116.
(2B)Where a chargeable gain accrues in accordance with subsection (12) of section 116, this Chapter shall have effect—
(a)as if that gain were a gain accruing on the disposal of an asset; and
(b)in relation to that deemed disposal, as if references in this Chapter to the consideration for the disposal were references to the sum of money falling, apart from this Chapter, to be used in computing the gain accruing under that subsection.”
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Textual Amendments
F36S. 178 repealed (with effect in accordance with s. 77 of the amending Act) by Finance Act 2004 (c. 12), Sch. 42 Pt. 2(7)
Textual Amendments
Textual Amendments
(1)In subsection (1) of section 196 of the M24Taxation of Chargeable Gains Act 1992 (interpretation of sections 194 and 195), for “licence” there shall be substituted “ UK licence ”.
(2)After subsection (1) of section 196 of that Act there shall be inserted the following subsection—
“(1A)For the purposes of section 194 a licence other than a UK licence relates to an undeveloped area at any time if, at that time—
(a)no development has actually taken place in any part of the licensed area; and
(b)no condition for the carrying out of development anywhere in that area has been satisfied—
(i)by the grant of any consent by the authorities of a country or territory exercising jurisdiction in relation to the area; or
(ii)by the approval or service on the licensee, by any such authorities, of any programme of development.”;
and in subsection (2) of that section for “subsection (1) above” there shall be substituted “ subsections (1) and (1A) above ”.
(3)For subsection (5) of section 196 of that Act there shall be substituted the following subsections—
“(5)In sections 194 and 195 and this section—
“foreign oil concession” means any right to search for or win overseas petroleum, being a right conferred or exercisable (whether or not by virtue of a licence) in relation to a particular area;
“interest” in relation to a licence, includes, where there is an agreement which—
relates to oil from the whole or any part of the licensed area, and
was made before the extraction of the oil to which it relates,
any entitlement under that agreement to, or to a share of, either that oil or the proceeds of its sale;
“licence” means any UK licence or foreign oil concession;
“licensed area” (subject to subsection (4) above)—
in relation to a UK licence, has the same meaning as in Part I of the M25Oil Taxation Act 1975; and
in relation to a foreign oil concession, means the area to which the concession applies;
“licensee”—
in relation to a UK licence, has the same meaning as in Part I of the Oil Taxation Act 1975; and
in relation to a foreign oil concession, means the person with the concession or any person having an interest in it;
“oil”—
except in relation to a UK licence, means any petroleum (within the meaning of the M26Petroleum (Production) Act 1934); and
in relation to such a licence, has the same meaning as in Part I of the Oil Taxation Act 1975;
“overseas petroleum” means any oil that exists in its natural condition at a place to which neither the M27Petroleum (Production) Act 1934 nor the M28Petroleum (Production) Act (Northern Ireland) 1964 applies; and
“UK licence” means a licence within the meaning of Part I of the M29Oil Taxation Act 1975.
(5A)References in sections 194 and 195 to a part disposal of a licence shall include references to the disposal of any interest in a licence.”
(4)Subsections (1) to (3) above shall have effect in relation to any disposal on or after 13th September 1995 and subsection (3) shall also have effect, and be deemed always to have had effect, for the construction of section 195 of the M30Taxation of Chargeable Gains Act 1992 in its application to disposals before that date.
(5)Where enactments re-enacted in the M31Taxation of Chargeable Gains Act 1992 apply, instead of that Act, in the case of any disposal before 13th September 1995, this section shall have effect as if it required amendments equivalent to those made by subsection (3) above to have effect, and be deemed always to have had effect, for the construction of any enactment corresponding to section 195 of that Act.
Marginal Citations
Schedule 36 to this Act (which contains amendments of Chapter IV of Part XVII of the Taxes Act 1988) shall have effect in relation to accounting periods of a controlled foreign company, within the meaning of that Chapter, beginning on or after 28th November 1995.