Finance Act 2013

Finance Act 2013

2013 CHAPTER 29

Introduction

Sections 94 – 174, Schedules 33, 34, 35: Annual Tax on Enveloped Dwellings

Details of the Sections

Section 135 – Non-qualifying occupation: look forward and look back

211. Subsection (1) provides that subsection (2) applies where, on a day in a chargeable period, a single-dwelling interest is being exploited in a property rental business or steps are being taken to exploit it, if a non-qualifying individual is permitted to occupy the dwelling.

212. Subsection (2) provides that, in those circumstances and where the continuity of ownership condition is met, no further day in that chargeable period or the subsequent three chargeable periods will be a relievable day unless and until there is a day of “qualifying use” as defined in subsection (8). This is the “look forward” restriction on future claims to relief.

213. Subsection (3) provides that the “continuity of ownership” condition will be met on any day where the owner is entitled to the single dwelling interest or, if the owner carried on or intended to carry on the property rental business in partnership, another member of the partnership is beneficially entitled to the interest.

214. Subsection (4) provides that subsection (5) applies where a non-qualifying individual is permitted to occupy a dwelling on a day in a chargeable period.

215. Subsection (5) provides that, in those circumstances, no day is relievable in the period running from the start of the preceding chargeable period to the day the non-qualifying individual was permitted to occupy the single-dwelling interest (where the single-dwelling interest was held, during that period, by a relevant person). This is the “look back” restriction on any previous claims to relief in the period of (up to) two prior years.

216. Subsection (6) defines “relevant person” as the person beneficially entitled to the single dwelling interest on the day of non-qualifying occupation or, where the owner carried on the property rental business in partnership, any other member of that partnership.

217. Subsection (7) provides that subsection (5) does not apply where there is an intervening day which was relievable by virtue of the single-dwelling interest being exploited as a source of rents in the course of a property rental business.

218. Subsection (8) defines the terms “day of qualifying use” as a day when it is relievable because it is being exploited as a source of rents or other receipts; and provides that occupation of part of a dwelling is regarded as occupation of it all.