Finance Act 2013

204 No deductions for UK or foreign bank levies

(1) Schedule 19 to FA 2011 (the bank levy) is amended as follows.

(2) In paragraph 46 (bank levy to be ignored for purposes of corporation tax and income tax), in paragraph (b), after “paid” insert “(directly or indirectly)”.

(3) In Part 7 (double taxation relief), after paragraph 69 insert—

“Foreign levies to be ignored for purposes of income tax or corporation tax

69A (1) In calculating profits or losses for the purposes of income tax or corporation tax—

(a) no deduction is allowed in respect of any tax which is imposed by the law of a territory outside the United Kingdom and corresponds to the bank levy, and

(b) no account is to be taken of any amount which is paid (directly or indirectly) by a member of a group to another member for the purposes of meeting or reimbursing the cost of such a tax charged in relation to the group.

(2) Paragraph 66(3) applies for the purposes of sub-paragraph (1) as it applies for the purposes of paragraph 66(2).”

(4) Accordingly—

(a) in paragraph 3, after “double taxation relief” insert “and with the deduction of foreign levies for the purposes of corporation tax and income tax”, and

(b) in the heading for Part 7, after “RELIEF” insert “ETC”

(5) The amendments made by this section have effect in relation to any period of account beginning on or after 1 January 2013.

(6) The amendments made by subsections (3) and (4) also have effect in relation to any period of account beginning before that date, but only if, and to the extent that, the tax is the subject of a claim for relief under paragraph 66 or 67 of Schedule 19 to FA 2011 (bank levy: double taxation relief) made on or after 5 December 2012.

(7) For the purposes of subsections (5) and (6), a period of account beginning before, and ending on or after 1 January 2013 is to be treated as if so much of the period as falls before that date, and so much of the period as falls on or after that date, were separate periods of account.