Finance Act 2004

Income and Corporation Taxes Act 1988 (c. 1) U.K.

2 U.K. The Income and Corporation Taxes Act 1988 (c. 1) is amended as follows.

Commencement Information

I1 Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284

3 U.K. In section 21A(2) (Schedule A: computation of amount chargeable), insert at the end—

“sections 196 to 200 of the Finance Act 2004 (registered pension schemes); section 246 of that Act (employer-financed retirement benefits schemes).”

Commencement Information

I2 Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284

4 U.K. In section 56(3)(b) (transfers in deposits and debts: exemption for pensions), for “592(2), 613, 614 (1) to (3) or 620(6)” substitute “ 613(4) or 614(2) or (3) or section 186 of the Finance Act 2004 ”.

Commencement Information

I3 Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284

F1 5 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F1 Sch. 35 para. 5 repealed (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 3 (with Sch. 2)

6 U.K. In section 129B(2) (stock lending fees), for “sections 592(2), 608(2)(a), 613(4), 614(3), 620(6) and 643(2)” substitute “ sections 613(4) and 614(3) and section 186 of the Finance Act 2004 ”.

Commencement Information

I4 Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284

7 U.K. In section 227(8)(a) (purchase of own shares: rules about trustees not to apply where shares held under exempt approved scheme), for “an exempt approved scheme as defined in Chapter 1 of Part 14” substitute “ a registered pension scheme ”.

Commencement Information

I5 Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284

F2 8 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F2 Sch. 35 para. 8 repealed (with effect in accordance with s. 1034(1) of the amending Act) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 3 Pt. 1 (with Sch. 2)

9 U.K. In section 266 (1) (life assurance premiums), for “sections 274 and 619(6) and Schedules 14 and 15,” substitute “ section 274 and Schedules 14 and 15 and sections 192 to 194 of the Finance Act 2004, ”.

Commencement Information

I6 Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284

10 (1) Section 266A (life assurance premiums paid by employer) is amended as follows. U.K.

(2) In subsection (1), for “a non-approved” substitute “ an employer-financed ”.

(3) For subsections (3) to (6) substitute—

“(3) For the purposes of subsection (1)(a) benefits are provided in respect of an employee if they are provided for the employee’s spouse [F3 or civil partner], widow or widower [F4 or surviving civil partner], children, dependants or personal representatives.

(4) If a sum within subsection (1) is paid with a view to the provision of benefits for or in respect of more than one employee of the employer, part of it is to be treated as paid for or in respect of each of them.

(5) The amount treated as paid for or in respect of each employee is—

where—

A is the sum paid,

B is the amount which would have had to be paid to secure the benefits to be provided for or in respect of the employee in question, and

C is the total amount which would have had to be paid to secure the benefits to be provided for or in respect of all the employees if separate payments had been made in the case of each of them.

(6) This section does not apply if—

(a) in the year of assessment in which the sum is paid the earnings from the employee’s employment are (or, if there are none, would be if there were any) earnings charged on remittance, or

(b) the employee is not domiciled in the United Kingdom in the tax year in which the sum is paid and the conditions in subsection (7) are met.

(7) Those conditions are—

(a) that the employment is with a foreign employer, and

(b) that, on a claim made by the employee, the Board are satisfied that the pension scheme corresponds to a registered pension scheme.

(8) In subsection (6)(a) “earnings charged on remittance” means earnings which are taxable earnings under—

(a) section 22 of ITEPA 2003 (chargeable overseas earnings for year when employee resident and ordinarily resident, but not domiciled, in UK), or

(b) section 26 of that Act (foreign earnings for year when employee resident, but not ordinarily resident, in UK).

(9) In this section—

“employer-financed retirement benefits scheme”, and

>“relevant benefits”,

have the same meaning as in Chapter 2 of Part 6 of ITEPA 2003 (see sections 393A and 393B of that Act).”

Textual Amendments

F3 Words in Sch. 35 para. 10(3) inserted (with effect in accordance with reg. 1(7) of the amending S.I.) by The Tax and Civil Partnership Regulations 2005 (S.I. 2005/3229), regs. 1(1), 181(a)

F4 Words in Sch. 35 para. 10(3) inserted (with effect in accordance with reg. 1(7) of the amending S.I.) by The Tax and Civil Partnership Regulations 2005 (S.I. 2005/3229), regs. 1(1), 181(b)

Commencement Information

I7 Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284

11 U.K. In section 268(7)(b) (early conversion or surrender of rights: life policies not covered), for “an approved scheme, as defined in Chapter 1 of Part 14;” substitute “ a registered pension scheme; ”.

Commencement Information

I8 Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284

12 U.K. In section 273 (payments securing annuities), [F5 for the words from the beginning to “, if the claimant” substitute “Subject to subsection (2) below, section 274 of this Act and sections 192 to 194 of the Finance Act 2004, if the claimant”].

Textual Amendments

F5 Words in Sch. 35 para. 12 substituted (6.4.2006) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 655, Sch. 2 para. 161 (with Sch. 2)

Commencement Information

I9 Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284

F6 13 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F6 Sch. 35 paras. 13-17 repealed (with effect in accordance with s. 1034(1) of the amending Act) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 3 Pt. 1 (with Sch. 2)

F6 14 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F6 Sch. 35 paras. 13-17 repealed (with effect in accordance with s. 1034(1) of the amending Act) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 3 Pt. 1 (with Sch. 2)

F6 15 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F6 Sch. 35 paras. 13-17 repealed (with effect in accordance with s. 1034(1) of the amending Act) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 3 Pt. 1 (with Sch. 2)

F6 16 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F6 Sch. 35 paras. 13-17 repealed (with effect in accordance with s. 1034(1) of the amending Act) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 3 Pt. 1 (with Sch. 2)

F6 17 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F6 Sch. 35 paras. 13-17 repealed (with effect in accordance with s. 1034(1) of the amending Act) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 3 Pt. 1 (with Sch. 2)

18 U.K. In section 414(7), (close companies: shares held on trust for certain pension schemes), for “an exempt approved scheme as defined in section 592” substitute “ a registered pension scheme ”.

Commencement Information

I10 Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284

19 U.K. In section 415(4)(b), (certain quoted companies not to be close companies: shares held on trust for certain pension schemes deemed to be beneficially held for public), for “an exempt approved scheme as defined in section 592,” substitute “ a registered pension scheme, ”.

Commencement Information

I11 Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284

20 U.K. For section 431B (life assurance: meaning of “pension business”) substitute—

“431B Meaning of “pension business”

(1) In this Chapter “pension business” means so much of a company’s life assurance business as is referable to contracts entered into for the purposes of a registered pension scheme or is the reinsurance of such business.

(2) Where a pension scheme ceases to be a registered pension scheme [F7 by virtue of the withdrawal of registration of the pension scheme under section 157 of the Finance Act 2004], any of the company’s life assurance business that was pension business when the pension scheme was a registered pension scheme is to be treated as ceasing to be pension business at the beginning of the period of account of the company in which the pension scheme [F8 so] ceases to be a registered pension scheme.

[F9 (3) Where—

(a) immediately before 6th April 2006 an annuity contract falls within any of the descriptions of contracts specified in subsection (2) of this section as it had effect immediately before that date, but

(b) on or after that date the contract does not fall to be regarded for the purposes of this section as having been entered into for the purposes of a registered pension scheme,

the contract is to be treated for the purposes of this section as having been entered into for such purposes.”]

Textual Amendments

F7 Words in Sch. 35 para. 20 inserted (6.4.2006) by Finance (No. 2) Act 2005 (c. 22), Sch. 9 para. 18(2)(3)(a)(7)

F8 Word in Sch. 35 para. 20 inserted (6.4.2006) by Finance (No. 2) Act 2005 (c. 22), Sch. 9 para. 18(2)(3)(b)(7)

F9 Words in Sch. 35 para. 20 inserted (6.4.2006) by Finance (No. 2) Act 2005 (c. 22), Sch. 9 para. 18(2)(4)(7)

Commencement Information

I12 Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284

21 U.K. In section 464(5) (policies and contracts to be disregarded in applying limits on benefits payable to member of friendly society), for paragraph (b) substitute—

“(b) any policy of insurance or annuity contract by means of which the benefits to be provided under an occupational pension scheme (within the meaning of section 150(5) of the Finance Act 2004) are secured or any annuity contract which constitutes a registered pension scheme or is issued or held in connection with a registered pension scheme other than such an occupational pension scheme;”.

Commencement Information

I13 Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284

22 (1) Section 466 (interpretation of Chapter 2 of Part 12) is amended as follows. U.K.

(2) In subsection (2), omit the definition of “pension business”.

(3) After that subsection insert—

“(2A) In this Chapter “pension business” means so much of a friendly society’s life assurance business as is referable to contracts entered into for the purposes of a registered pension scheme.

(2B) But where a pension scheme ceases to be a registered pension scheme [F10 by virtue of the withdrawal of registration of the pension scheme under section 157 of the Finance Act 2004], any of the friendly society’s life assurance business that was pension business when the pension scheme was a registered pension scheme is to be treated as ceasing to be pension business at the beginning of the period of account of the friendly society in which the pension scheme [F11 so] ceases to be a registered pension scheme.”

Textual Amendments

F10 Words in Sch. 35 para. 22 inserted (6.4.2006) by Finance (No. 2) Act 2005 (c. 22), Sch. 9 para. 18(5)(6)(a)(7)

F11 Word in Sch. 35 para. 22 inserted (6.4.2006) by Finance (No. 2) Act 2005 (c. 22), Sch. 9 para. 18(5)(6)(b)(7)

Commencement Information

I14 Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284

23 U.K. In section 467(3) (exemption for trade unions and employers' associations: disregard of certain annuities for purposes of limit), for “approved annuities (as defined in section 620(9))” substitute “ annuity contract which constitutes a registered pension scheme or is issued or held in connection with a registered pension scheme other than an occupational pension scheme (within the meaning of section 150(5) of the Finance Act 2004) ”.

Commencement Information

I15 Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284

F12 24 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F12 Sch. 35 para. 24 repealed (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 3 (with Sch. 2)

25 U.K. In section 539(2) (policies of life insurance to which Chapter 2 of Part 13) does not apply), for paragraphs (b) to (d) substitute—

“(b) to any policy of insurance which constitutes, or is issued or held in connection with, a registered pension scheme; or”.

Commencement Information

I16 Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284

26 U.K. In section 613(4) (parliamentary pension funds)—

(a) omit “respective” and paragraphs (b) to (d), and

(b) for “those funds” (in both places) substitute “ that Fund ”.

Commencement Information

I17 Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284

27 (1) Section 657(2) (life annuities to which section 656 does not apply) is amended as follows. U.K.

(2) In paragraph (b), for “266, 273 or 619 or to any annuity payable under a substituted contract within the meaning of section 622(3);” substitute “ 266 or 273; ”.

(3) For paragraphs (d) to (f) substitute—

“(d) to any annuity under, or purchased with sums or assets held for the purposes of, a registered pension scheme; or

(e) to any annuity purchased by any person in recognition of another’s services (or past services) in any office or employment.”

Commencement Information

I18 Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284

F13 28 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F13 Sch. 35 para. 28 repealed (6.4.2005) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 3 (with Sch. 2)

F14 29 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F14 Sch. 35 para. 29 repealed (with effect in accordance with s. 1034(1) of the amending Act) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 3 Pt. 1 (with Sch. 2)

F15 30 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F15 Sch. 35 para. 30 repealed (with effect in accordance with s. 1034(1) of the amending Act) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 3 Pt. 1 (with Sch. 2)

F16 31 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F16 Sch. 35 para. 31 repealed (with effect in accordance with s. 1034(1) of the amending Act) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 3 Pt. 1 (with Sch. 2)

F17 32 U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F17 Sch. 35 para. 32 repealed (with effect in accordance with s. 1034(1) of the amending Act) by Income Tax Act 2007 (c. 3), s. 1034(1), Sch. 3 Pt. 1 (with Sch. 2)

33 U.K. In section 824(9) (repayment supplements), after “settlement” insert “, scheme administrators of registered pension schemes [F18 sub-scheme administrators of sub-schemes which form part of a split scheme pursuant to the Registered Pensions (Splitting of Schemes) Regulations 2006]”.

Textual Amendments

F18 Words in Sch. 35 para. 33 added (6.4.2006) by The Registered Pension Schemes (Splitting of Schemes) Regulations 2006 (S.I. 2006/569), regs. 1(1), 5(6)(7)

Commencement Information

I19 Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284

34 U.K. In section 828 (orders and regulations), after subsection (5) insert—

“(6) Nothing in this section applies in relation to any of the following (in relation to which section 282 of the Finance Act 2004 applies)—

(a) any power of the Treasury or the Board to make any order or regulations under Part 4 of that Act;

(b) any statutory instrument containing any order or regulations made by the Treasury or the Board under that Part of that Act.”

Commencement Information

I20 Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284

35 (1) Section 832 (1) (interpretation of the Tax Acts) is amended as follows. U.K.

(2) After the definition of “the rate applicable to trusts” insert—

““registered pension scheme” has the meaning given by section 150(2) of the Finance Act 2004;”.

(3) After the definition of “Schedule A business” insert—

““scheme administrator”, in relation to a pension scheme, has the meaning given by section 270 of the Finance Act 2004 (but see also sections 271 to 274 of that Act);”.

Commencement Information

I21 Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284

36 U.K. In section 840A(1)(b)(iv) (definition of “bank”: exclusion of insurance companies), for “659B(1);” substitute “ 275 of the Finance Act 2004; ”.

Commencement Information

I22 Ss. 160-274, 281, Schs. 30-35 in force at 6.4.2006 but any power to make an order or regulations under those provisions may be exercised at any time after Royal Assent, see s. 284