Finance Act 1983

• (4) Where an individual subscribes for shares in a company with which he is not connected (either within the meaning of this paragraph or by virtue of paragraph 2(1B)(b) of Schedule 12, as applied by paragraph 18(5) below) he shall nevertheless be treated as connected with it if he subscribes for the shares as part of any arrangement which provides for another person to subscribe for shares in another company with which that or any other individual who is a party to the arrangement is connected (within the meaning of this paragraph or by virtue of that paragraph).

Qualifying companies

5

• (1) A company is a qualifying company if it is incorporated in the United Kingdom and complies with the requirements of this paragraph.

• (2) The company must, throughout the relevant period, be an unquoted company which is resident in the United Kingdom and not resident elsewhere, and be—

• (a) a company which exists wholly, or substantially wholly, for the purpose of carrying on wholly or mainly in the United Kingdom one or more qualifying trades ; or

• (b) a company whose business consists wholly of—

• (i) the holding of shares or securities of, or the making of loans to, one or more qualifying subsidiaries of the company; or

• (ii) both the holding of such shares or securities, or the making of such loans and the carrying on of one or more qualifying trades.

• (3) In this paragraph "qualifying subsidiary", in relation to a company, means a subsidiary of that company of a kind which may be held by virtue of paragraph 17 below.

• (4) Without prejudice to the generality of sub-paragraph (2) above, but subject to sub-paragraph (5) below, a company ceases to comply with that sub-paragraph if before the end of the relevant period a resolution is passed, or an order is made, for the winding up of the company (or, in the case of a winding up otherwise than under the Companies Act 1948 or the Companies Act (Northern Ireland) 1960, any other act is done for the like purpose) or the company is dissolved without winding up.

• (5) A company shall not be regarded as ceasing to comply with sub-paragraph (2) above if it does so by reason of being wound up or dissolved without winding up and—

• (a) it is shown that the winding up or dissolution is for bonafide commercial reasons and not part of a scheme or arrangement the main purpose or one of the main purposes of which is the avoidance of tax ; and

• (b) the company's net assets, if any, are distributed to its members or dealt with as bona vacantia before the end of the relevant period or, in the case of a winding up, the end (if later) of three years from the commencement of the winding up.

• (6) The company's share capital must not, at any time in the relevant period, include any issued shares that are not fully paid up.

• (7) Subject to paragraph 17 below, the company must not at any time in the relevant period—

• (a) control (or together with any person connected with it control) another company or be under the control of another company (or of another company and any person connected with that other company); or

• (b) be a 51 per cent, subsidiary of another company or itself have a 51 per cent subsidiary ;

and no arrangements must be in existence at any time in that period by virtue of which the company could fall within paragraph (a) or (b) above.

• (8) A company is not a qualifying company if—

• (a) an individual has acquired a controlling interest in the company's trade after 5th April 1983 ; and

• (b) at any time in the period mentioned in sub-paragraph (10) below he has, or has had, a controlling interest in another trade; and

• (c) the trade carried on by the company, or a substantial part of it—

• (i) is concerned with the same or similar types of property or parts thereof or provides the same or similar services or facilities as the other trade ; or

• (ii) serves substantially the same or similar outlets or markets as the other trade.

• (9) Section 56(8) and (9) of Chapter II shall apply for the purposes of sub-paragraph (8) above.

• (10) The period referred to in sub-paragraph (8) above is the period beginning two years before and ending three years after—

• (a) the date on which the shares were issued; or

• (b) if later, the date on which the company began to carry on the trade.

Qualifying trades

6

• (1) A trade is a qualifying trade if it complies with the requirements of this paragraph,

• (2) The trade must not at any time in the relevant period consist to any substantial extent of any of the activities mentioned in section 56(2) of Chapter II (as read with section 56(3) and Schedule 11).

• (3) The trade must, during the relevant period, be conducted on a commercial basis and with a view to the realisation of profits.

• (4) Section 56(10) of Chapter II shall apply.

Disposal of shares

7

• (1) Where an individual disposes of any eligible shares before the end of the relevant period, then—

• (a) if the disposal is otherwise than by way of a bargain made at arm's length, he shall not be entitled to any relief in respect of those shares; and

• (b) in any other case, the amount of relief to which he is entitled in respect of those shares shall be reduced by the amount or value of the consideration which he receives for them.

• (2) Where an individual holds ordinary shares in a company and the relief has been given in respect of some but not others, any disposal by him of ordinary shares in the company shall be treated for the purposes of this paragraph as relating—

• (a) first, to those (if any) in respect of which relief has been given under Chapter II rather than to others ; and

• (b) then, to those in respect of which relief has been given under this Part rather than to others.

• (3) Section 57(3) and (4) of Chapter II shall apply but, in the case of subsection (4), with the substitution for the reference to subsection (2) of a reference to sub-paragraph (2) above.

Value received from company

8

• (1) Where an individual who subscribes for eligible shares in a company—

• (a) has, before the issue of the shares but within the relevant period, received any value from the company ; or

• (b) after their issue but before the end of the relevant period, receives any such value ;

the amount of the relief to which he is entitled in respect of the shares shall be reduced by the value received ; but the value received shall be disregarded to the extent to which relief under Chapter II has, by virtue of section 58(1) of that Chapter, been reduced on its account.

• (2) Subject to sub-paragraph (3) below, section 58(2) to (9) of Chapter II shall apply but, in the case of subsection (3), with the substitution for the reference to section 55(5) of a reference to paragraph 5(5) above.

• (3) For the purposes of this paragraph an individual also receives value from the company if any person connected with the company (within the meaning of section 54 of Chapter II)—

• (a) purchases any of its share capital or securities which belong to the individual; or

• (b) makes any payment to him for giving up any right in relation to any of the company's share capital or securities,

and the value received by the individual is the amount receivable by the individual or, if greater, the market value of the shares or securities in question.

Replacement capital

9

• (1) An individual is not entitled to relief in respect of any shares in a company where—

• (a) at any time in the relevant period, the company or any of its subsidiaries—

• (i) begins to carry on a trade which was previously carried on at any time in that period by a person other than the company or any of its subsidiaries ; or

• (ii) acquires the whole, or greater part, of the assets used for the purposes of a trade previously so carried on; and

• (b) sub-paragraph (2) below applies in relation to that individual.

• (2) This sub-paragraph applies in relation to an individual where—

• (a) the person or persons to whom an interest amounting in the aggregate to more than a half share in the trade (as previously carried on) belonged, at any time in the relevant period, is or are the person or persons to whom such an interest in the trade (as transferred) belongs or has, at any such time, belonged ; or

• (b) the person or persons who control or, at any such time, have controlled the company are the person or persons who, at any such time, controlled another company which previously carried on the trade ;

and the individual is that person or one of those persons.

• (3) An individual is not entitled to relief in respect of any shares in a company where—

• (a) the company comes to acquire all of the issued share capital of another company, at any time in the relevant period ; and

• (b) the person or persons who control or have, at any such time, controlled the company are the person or persons who, at any such time, controlled that other company ;

and the individual is that person, or one of those persons.

• (4) For the purposes of sub-paragraph (2) above—

• (a) the persons to whom a trade belongs and, where a trade belongs to two or more persons, their respective shares in that trade shall be determined in accordance with subsections (1)(a) and (b), (2) and (3) of section 253 of the Taxes Act; and

• (b) any interest, rights or powers of a person who is an associate (as denned by section 67(1) of Chapter II) of another person shall be treated as those of that other person.

• (5) In this paragraph—

• " subsidiary " means a subsidiary of a kind which a qualifying company may have by virtue of paragraph 17 below ; and

• " trade " includes any business, profession or vocation and any part of a trade.

Value received by persons other than claimants

10

• (1) The relief to which an individual is entitled in respect of any shares in a company shall be reduced in accordance with section 59(3) of Chapter II, as applied by sub-paragraph (2) below, if at any time in the relevant period the company repays, redeems or repurchases any of its share capital which belongs to any member other than—

• (a) that individual; or

• (b) another individual whose relief is thereby reduced by virtue of section 58(2)(a) of Chapter II as applied by paragraph 8 above,

or makes any payment to any such member for giving up his right to any of the company's share capital on its cancellation or extinguishment.

• (2) Section 59(3) to (8) of Chapter II shall apply, but with the deletion, in subsection (4), of the reference to section 53(3) and (7) and, in subsection (6), of paragraphs (a) and (b).

• (3) Sub-paragraph (1) above does not apply in relation to the redemption of any share capital for which the redemption date was fixed before 15th March 1983.

• (4) Where—

• (a) after 5th April 1983 a company issues share capital (" the original shares ") of nominal value equal to the authorised minimum (within the meaning of the Companies Act 1980) for the purposes of complying with the requirements of section 4 of that Act (public company not to do business unless requirements as to share capital complied with) ; and

• (b) after the registrar of companies has issued the company with a certificate under section 4 it issues eligible shares,

sub-paragraph (1) above shall not apply in relation to any redemption of any of the original shares within 12 months of the date on which those shares were issued.

• (5) Where—

• (a) a company has issued shares in respect of which one or more individuals are entitled to relief under this Part and has also issued shares in respect of which one or more individuals are entitled to relief under Chapter II; and

• (b) sub-paragraph (1) above applies ;

then, for the purposes of section 59(3) of Chapter LT (as it applies both to this Part and to Chapter II), the relief given under Chapter II shall be treated as if it were relief given under this Part.

Prevention of misuse

11

An individual is not entitled to relief in respect of any shares unless the shares are subscribed for and issued for bona fide commercial purposes and not as part of a scheme or arrangement the main purpose or one of the main purposes of which is the avoidance of tax.

Husband and wife

12

• (1) In the case of any amount subscribed by a married woman for eligible shares issued to her at a time—

• (a) when she is living with her husband ; and

• (b) which falls in a year of assessment for which his income includes (or, if there were any, would include) any of hers,

the deduction under paragraph 2(3) above shall, subject to sub-paragraph (2) below, be made from his total income, and references in this Part to the relief to which an individual is entitled in respect of any shares shall be construed accordingly.

• (2) Section 60(2) to (7) of Chapter II shall apply, with the substitution, for references to sections 52(2), 53(1) and (2) and 57(1) of references to, respectively, paragraphs 2(3), 3(1) and (2) and 7(1) above.

Claims

13

• (1) A claim for the relief in respect of eligible shares issued by a company in any year of assessment shall be made—

• (a) not earlier than 1st January 1984 or, if later, the end of the period of four months mentioned in paragraph 2(4)(a) above; and

• (b) not later than two years after the end of that year of assessment or, if that period of four months ended after the end of that year, not later than two years after the end of that period.

• (2) A claim for relief in respect of eligible shares in a company shall not be allowed unless it is accompanied by a certificate issued by the company in such form as the Board may direct and certifying that the conditions for the relief, so far as applying to the company and the trade, are satisfied in relation to those shares.

• (3) Before issuing a certificate for the purposes of sub-paragraph (2) above a company shall furnish the inspector with a statement to the effect that it satisfies the conditions for the relief, so far as they apply in relation to the company and the trade, and has done so at all times since the beginning of the relevant period.

• (4) No such certificate shall be issued without the authority of the inspector or where the company, or a person connected with the company, has given notice to the inspector under paragraph 15(2) below.

• (5) Any statement under sub-paragraph (3) above shall contain such information as the Board may reasonably require, shall be in such form as the Board may direct and shall contain a declaration that it is correct to the best of the company's knowledge and belief.

• (6) Where a company has issued a certificate for the purposes of sub-paragraph (2) above, or furnished a statement under sub-paragraph (3) above and—

• (a) the certificate or statement is made fraudulently or negligently ; or

• (b) the certificate was issued in contravention of sub-paragraph (4) above;

the company shall be liable to a penalty not exceeding £250 or, in the case of fraud, £500.

• (7) For the purpose of regulations made under section 204 of the Taxes Act (pay as you earn), no regard shall be had to the relief unless a claim for it has been duly made and admitted.

• (8) Section 61(6) of Chapter II shall apply.

• (9) For the purposes of section 86 of the Taxes Management Act 1970 (interest on overdue tax), tax charged by an assessment—

• (a) shall be regarded as due and payable notwithstanding that relief from the tax (whether by discharge or repayment) is subsequently given on a claim for the relief; but

• (b) shall, unless paid earlier or due and payable later, be regarded as paid on the date of the making of the claim on which the relief is given ;

and section 91 of that Act (effect on interest of reliefs) shall not apply in consequence of any discharge or repayment for giving effect to the relief.

Assessments for withdrawing relief

14

• (1) Where any relief has been given which is subsequently found not to have been due, it shall be withdrawn by the making of an assessment to tax under Case VI of Schedule D for the year of assessment for which the relief was given.

• (2) Section 62(2) to (7) of Chapter II shall apply but, in the case of subsection (4), with the substitution for the reference to section 57(1)(b) of a reference to paragraph 7(1)(b) above and, in the case of subsection (6), with the substitution for paragraphs (a) to (d) of the following paragraphs—

(a) in the case of relief withdrawn by virtue of paragraphs 4, 5, 6 or 10(1) of Schedule 5 to the Finance Act 1983 in consequence of any event after the grant of the relief, the date of that event; (b) in the case of relief withdrawn by virtue of paragraph 7(1) of that Schedule in consequence of a disposal after the grant of the relief, the date of the disposal; (c) in the case of relief withdrawn by virtue of paragraph 8 of that Schedule in consequence of a receipt of value after the grant of the relief, the date of the receipt; (d) in the case of relief withdrawn by virtue of paragraph 11 of that Schedule— (i) so far as effect has been given to the relief in accordance with regulations under section 204 of the Taxes Act (pay as you earn), 5th April in the year of assessment in which effect was so given ; and (ii) so far as effect has not been so given, the date on which the relief was granted.

Information

15

• (1) Where an event occurs by reason of which any relief given to an individual falls to be withdrawn by virtue of paragraph 4, 7, 8 or 12(2) above the individual shall within sixty days of his coming to know of the event give a notice in writing to the inspector containing particulars of the event

• (2) Where an event occurs by reason of which any relief in respect of any shares in a company falls to be withdrawn by virtue of paragraph 5, 6, 8, 9, 10 or 11 above—

• (a) the company ; and

• (b) any person connected with the company who has knowledge of that matter;

shall within sixty days of the event or, in the case of a person within paragraph (b) above, of his coming to know of it, give a notice in writing to the inspector containing particulars of the event or payment

• (3) If the inspector has reason to believe that a person has not given a notice which he is required to give under sub-paragraph (1) or (2) above in respect of any event the inspector may by notice in writing require that person to furnish him within such time (not being less than sixty days) as may be specified in the notice with such information relating to the event as the inspector may reasonably require for the purposes of this Part.

• (4) Where relief is claimed in respect of shares in a company and the inspector has reason to believe that it may not be due by reason of any such arrangement or scheme as is mentioned in paragraph 4(4), 5(7) or 11 above, he may by notice in writing require any person concerned to furnish him within such time (not being less than sixty days) as may be specified in the notice with—

• (a) a declaration in writing stating whether or not, according to the information which that person has or can reasonably obtain, any such arrangement or scheme exists or has existed;

• (b) such other information as the inspector may reasonably require for the purposes of the provision in question and as that person has or can reasonably obtain.

• (5) References in sub-paragraph (4) above to the person concerned are, in relation to paragraphs 4(4) and 11, the claimant and, in relation to paragraphs 5(7) and 11, the company and any person controlling the company.

• (6) Section 63(7) to (9) of Chapter II shall apply but with the substitution, for the reference to section 58, of a reference to paragraph 8 above.

Capital gains tax

16

• (1) The sums allowable as deductions from the consideration in the computation for the purposes of capital gains tax of the gain or loss accruing to an individual on the disposal of shares in respect of which any relief has been given and not withdrawn shall be determined without regard to that relief, except that where those sums exceed the consideration they shall be reduced by an amount equal to—

• (a) the amount of that relief, or

• (b) the excess,

whichever is the less, but the foregoing provisions of this sub-paragraph shall not apply to a disposal falling within section 44(1) of the Capital Gains Tax Act 1979 (disposals between husband and wife).

• (2) Sections 88 and 89 of the Finance Act 1982 (identification of securities disposed of) shall not apply to shares in respect of which any relief has been given and not withdrawn ; and any question—

• (a) as to which of any such shares issued to a person at different times a disposal relates ; or

• (b) whether a disposal relates to such shares or to other shares ;

shall for the purposes of capital gains tax be determined as for the purposes of paragraph 7 above.

• (3) Where an individual holds ordinary shares in a company and the relief has been given in respect of some but not others, then, if there is within the meaning of section 77 of the Act of 1979 a reorganisation affecting those shares, section 78 of that Act shall apply separately to the shares in respect of which the relief has been given and to the other shares (so that the shares of each kind are treated as a separate holding of original shares and identified with a separate new holding).

• (4) There shall be made all such adjustments of capital gains tax, whether by way of assessment or by way of discharge or repayment of tax, as may be required in consequence of the relief being given or withdrawn.

Application to subsidiaries

17

• (1) A qualifying company may, in the relevant period, have one or more subsidiaries if—

• (a) the conditions mentioned in section 65(2) of Chapter II are satisfied in respect of the subsidiary or each subsidiary and, except as provided in section 65(3), continue to be so satisfied until the end of the relevant period ; and

• (b) the subsidiary or each subsidiary was incorporated in the United Kingdom and is a company falling within sub-paragraph (2)(a) of paragraph 5 above ; and

• (c) the subsidiary or each subsidiary complies with paragraph 5(2) above.

• (2) Where a qualifying company has one or more subsidiaries in the relevant period this Part shall have effect subject to paragraph 18 below.

18

• (1) The shares issued by the qualifying company may, instead of or as well as being issued for the purpose mentioned in sub-paragraph (1)(b) of paragraph 2 above, be issued for the purpose of raising money for a qualifying trade which is being carried on by a subsidiary or which a subsidiary intends to carry on within the next four months; and where shares are so issued sub-paragraphs (4), (5) (7)(6) and (8) of that paragraph shall have effect as if references to the company were or, as the case may be, included references to the subsidiary.

• (2) In relation to a qualifying trade carried on by a subsidiary the reference in section 56(2)(f) of Chapter II (as applied for the purposes of this Part) to another person shall not include a reference to the company of which it is a subsidiary.

• (3) In sub-paragraph (1) of paragraph 10 above references to the company (except the first) shall include references to a company which during the relevant period is a subsidiary of the company, whether it becomes a subsidiary before or after the redemption, repayment, repurchase or payment referred to in that sub-paragraph.

• (4) Sub-paragraphs (4) and (5) of paragraph 15 above shall have effect in relation to any such arrangements as are mentioned in section 65(2)(c) of Chapter II as they have effect in relation to any such arrangement as is mentioned in paragraph 11 above.

• (5) The following provisions of Chapter II shall apply: paragraphs 2 and 4 of Schedule 12; but paragraph 4 shall apply with the substitution of a reference to paragraph 8(1) above for the reference to section 58(1).

Nominees and approved investment funds

19

• (1) Shares subscribed for, issued to, held by or disposed of for an individual by a nominee shall be treated for the purposes of this Part as subscribed for, issued to, held by or disposed of by that individual.

• (2) Paragraph 3(1) above shall not apply where the amount is subscribed as nominee for an individual by the person or persons having the management of an investment fund approved for the purposes of this paragraph by the Board ("the managers of an approved fund ").

• (3) Where an individual claims relief in respect of eligible shares in a company which have been issued to the managers of an approved fund as nominee for that individual, paragraph 13(2) above shall apply as if it required—

• (a) the certificate referred to in that paragraph to be issued by the company to the managers; and

• (b) the claim for relief to be accompanied by a certificate issued by the managers, in such form as the Board may authorise, certifying that the managers hold certificates issued to them by the companies concerned, for die purposes of paragraph 13(2) above, in respect of the holdings of eligible shares shown on the managers' certificate.

• (4) The managers of an approved fund may be required by a notice given to them by an inspector or other officer of the Board to deliver to the officer, within the time limited by the notice, a return of the holdings of eligible shares shown on certificates issued by them in accordance with sub-paragraph (3) above in the year of assessment to which the return relates.

• (5) Paragraph 13(6) above shall not apply in relation to any certificate issued by the managers of an approved fund for the purposes of sub-paragraph (3) above.

Interpretation

20

• (1) Subject to sub-paragraph (2) below, section 67 of Chapter II shall apply.

• (2) In this Part, including provisions of Chapter II as applied by this Part—

• " debenture " has the meaning given by section 455 of the Companies Act 1948;

• " the relevant period " has the meaning given in paragraph 2(7) above;

• " the relief " and " relief ", except in references to relief under Chapter II, means relief under paragraph 2 above and references to the amount of the relief shall be construed in accordance with sub-paragraph (3) of that paragraph; and

• " unquoted company " means a company none of whose shares, stocks or debentures are listed in the Official List of the Stock Exchange or dealt in on the Unlisted Securities Market

PART II — Amendments of Chapter n of Part IV of the Finance Act 1981

21

In section 52(9) of the Finance Act 1981 (relief available only where shares issued in 1981-82 or the next two years) for the words "or either of the next two years of assessment" there shall be substituted the words " or the year 1982-83 " .

22

Section 53(7) of the Act of 1981 (withdrawal of relief where more than 50 per cent, of the company's share capital consists of shares in respect of which relief has been given) shall cease to have effect in relation to events occurring on or after 6th April 1983.

23

Where, at any time after 5th April 1983, a company has any share capital of a kind falling within paragraph (a) or (b) of section 55(7) of the Act of 1981 (restrictions on types of share capital) that section shall apply as if paragraphs (a) and (b) were omitted.

SCHEDULE 6

Interpretation

1

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Election for pooling

2

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Effect of election

3

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

The 1982 identification rules

4

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

The indexation allowance

5

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

7

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Transfers on a no gain/no loss basis

9

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Consideration for options

10

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Supplementary

11

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

SCHEDULE 7

1

In paragraph 1(3) (returns for periods after liability for APRT has ceased) the word “nine” shall be omitted.

2

In paragraph 2(2) (instalment payments where liability for APRT expires) for the words from “the chargeable period” to “for that field” there shall be substituted the words “ any chargeable period ending on or after 31st December 1984. ”

3

• (1) In paragraph 14 (repayment of APRT) in sub-paragraph (1) for the words from “for the last” to “section 139(1)(b)” there shall be substituted the words “ for the ninth chargeable period following the first chargeable period referred to in section 139(1)(a) ”.

• (2) In sub-paragraph (2) of that paragraph for the words from “the last” to “this Act” there shall be substituted the words “ the ninth chargeable period referred to in sub-paragraph (1) above ” and for the words “subsection (4) of that section” there shall be substituted the words “ section 139(4) of this Act ”.

• (3) In sub-paragraph (3) of that paragraph for the words “the last chargeable period” and in sub-paragraph (4)(a) of that paragraph for the words “the chargeable period” there shall be substituted the words “ the ninth chargeable period ”.

4

In paragraph 17 (abandoned fields) in sub-paragraph (1)(c) for the words from “last” to “section 139(1)(b)” there shall be substituted the words “ ninth chargeable period following the first chargeable period referred to in section 139(1)(a) ”.

SCHEDULE 8

Part I — Section to be Inserted after Section 5 of the Principal Act

Part II — Amendments Relating to the New Allowance

The principal Act

1

In section 2(9) of the principal Act (amounts to be taken into account in respect of expenditure) at the end of paragraph (e) there shall be added

and (f) any exploration and appraisal expenditure allowable in the case of the participator under section 5A of this Act which, on a claim made by him under Schedule 7 to this Act, has been allowed under that Schedule before the Board have made an assessment to tax or a determination on or in relation to him for the period in respect of the field, so far as that expenditure has not been taken into account in any previous assessment to tax or determination.

2

At the end of subsection (3) of section 3 of the principal Act (expenditure not allowable under that section if already allowed under other provisions) there shall be added the words “ but where expenditure allowable under section 5A of this Act has been allowed on a claim under Schedule 7 to this Act, nothing in this subsection shall prevent a claim being made for an allowance under this section in respect of the same expenditure unless the person making the claim is the participator who made the claim under that Schedule ”.

3

In section 5 of the principal Act (allowance of abortive exploration expenditure) in subsection (1) after the words “1st January 1960” there shall be inserted the words “ and before 16th March 1983 ”.

4

In section 9 of the principal Act (limit on amount of tax payable) in subsection (2)(a)(ii) for the words “and (e)” there shall be substituted the words “ (e) and (f) ”.

5

In paragraph 2 of Schedule 2 to the principal Act (returns by participators) at the end of sub-paragraph (2) there shall be inserted the following sub-paragraph:—

(2A) Every participator in an oil field shall, in the first return under this paragraph which he makes for that field, state whether any and, if any, how much exploration and appraisal expenditure to which section 5A of this Act applies and which relates to, or to a licence for, any part of the field has been claimed under Schedule 7 to this Act— (a) by him, or (b) by a company associated with him in respect of that expenditure, or (c) if he or such a company is the new participator, within the meaning of Schedule 17 to the Finance Act 1980, by the old participator, within the meaning of that Schedule, or by a company associated with him in respect of that expenditure, and subsection (7) of section 5 of this Act applies for the purposes of this sub-paragraph as it applies for the purposes of that section.

6

• (1) In Schedule 7 to the principal Act (claims for allowance of abortive exploration expenditure) in paragraph 1(1), for the words from “of any” to “of this Act” there shall be substituted:—

(a) of any abortive exploration expenditure allowable under section 5 of this Act, or (b) of any exploration and appraisal expenditure allowable under section 5A of this Act

.

• (2) In paragraph 1(3) of that Schedule, after the words “section 5” there shall be added the words “ or, as the case may be, section 5A. ”

The Petroleum Revenue Tax Act 1980

7

In the Schedule to the Petroleum Revenue Tax Act 1980 (computation of payment on account) in paragraph 2(4) for the words “or (d)” there shall be substituted the words “ (d) or (f) ”.

The Finance Act 1980

8

In Schedule 17 to the Finance Act 1980 (transfers of interests in oil fields) after paragraph 16 (abortive exploration expenditure) there shall be inserted—

(16A) In relation to exploration and appraisal expenditure to which section 5A applies, paragraph 16 above has effect as if any reference therein to section 5 were a reference to section 5A.

The Finance Act 1981

9

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Part III — Receipts to be Set Against Allowable Expenditure

10

In this Part of this Schedule—

• “allowable expenditure” means expenditure which, in accordance with section 5 or section 5A of the principal Act, is allowable on a claim made by a participator under Schedule 7 to that Act; and

• “qualifying receipt” means a sum the amount of which falls, by virtue of subsection (6) of section 5 of the principal Act, to be applied by way of reduction in the amount of expenditure which would otherwise be allowable expenditure.

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• (1) A return made by a participator for a chargeable period under paragraph 2 of Schedule 2 to the principal Act shall give details of any qualifying receipt (whether received by him or by a person connected with him) of which details have not been given in a return made by him for an earlier chargeable period.

• (2) Section 1122 of the Corporation Tax Act 2010 (connected persons) applies for the purposes of this paragraph.

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• (1) This paragraph applies where—

• (a) a claim for allowable expenditure has been made by a participator under Schedule 7 to the principal Act; and

• (b) as a result of the receipt (whether before or after the making of the claim) of a qualifying receipt, the amount allowed by way of allowable expenditure on the claim exceeds what it should have been.

• (2) In determining, in a case where this paragraph applies, the assessable profit or allowable loss accruing to the participator in the chargeable period in which the qualifying receipt is received, the amount of the excess referred to in sub-paragraph (1)(b) above shall be taken into account under section 2 of the principal Act as an amount which is to be included among the positive amounts referred to in subsection (3)(a) of that section.

• (3) In the application of section 9 of the principal Act (limit on amount of tax payable) to a chargeable period in respect of which sub-paragraph (2) above applies, the amount of the excess referred to in sub-paragraph (1)(b) above shall be deducted from the amount which would otherwise be the total ascertained under subsection (2)(a)(ii) of that section and, if the amount of that excess is greater than the amount which would otherwise be that total, that total shall be a negative amount equal to the difference.

SCHEDULE 9

Value added tax and car tax

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2

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Capital transfer tax

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4

In paragraph 2(2A) of Schedule 4 to that Act, for the words " relevant property " there shall be substituted the words " appropriate property " .

5

In paragraph 4(10) of Schedule 5 to that Act, after the words " in this paragraph " there shall be inserted the words " and in section 46(5) of this Act " .

6

In section 78(4)(b) of the Finance Act 1976, the words " to the Board " and the words from " or " to " tax)" shall cease to have effect.

7

In section 114(6) of that Act, for the words "the said section 37" there shall be substituted the words " section 37 of the said Act of 1975 " .

SCHEDULE 10

Part I — Miscellaneous Customs and Excise

Part II — Income Tax, Corporation Tax and Capital Gains Tax

Part III — Oil Taxation

Duties on spirits, beer, wine, madewine and cider.

Hydrocarbon oil.

Bingo duty and gaming machine licence duty.

Miscellaneous customs and excise repeals.

Terms of payment to be implied in determining market value.

Terms of payment to be implied in determining market value.

Variation of decisions on claims for allowable expenditure.

Transfers of interests in oil fields.

National savings: supplements.

Historic Buildings and Monuments Commission for England.

Wine: Rates of Duty

Transfers on a no gain / no loss basis

The repeals in the Finance Act 1969, the Alcoholic Liquor Duties Act 1979 and the Finance Act 1980 have effect on the appointed day within the meaning of section 9(2) of this Act.

1

The repeal in section 226(3)(c) of the Income and Corporation Taxes Act 1970 shall be deemed to have come into force on 6th April 1983.

2

The repeals in sections 53, 59, 62 and 63 of the Finance Act 1981 have effect in relation to events occurring on or after 6th April 1983.

Editorial notes