Finance Act 1986

102ZA

• (1) Subsection (2) below applies where—

• (a) an individual is beneficially entitled to an interest in possession in settled property,

• (b) either—

• (i) the individual became beneficially entitled to the interest in possession before 22nd March 2006, or

• (ii) the individual became beneficially entitled to the interest in possession on or after 22nd March 2006 and the interest is an immediate post-death interest, a disabled person's interest or a transitional serial interest or falls within section 5(1B) of the 1984 Act, and

• (c) the interest in possession comes to an end during the individual's life.

• (2) For the purposes of—

• (a) section 102 above, and

• (b) Schedule 20 to this Act,

the individual shall be taken (if, or so far as, he would not otherwise be) to dispose, on the coming to an end of the interest in possession, of the no-longer-possessed property by way of gift.

• (3) In subsection (2) above “the no-longer-possessed property” means the property in which the interest in possession subsisted immediately before it came to an end, other than any of it to which the individual becomes absolutely and beneficially entitled in possession on the coming to an end of the interest in possession.

Termination of interests in possession

4A

• (1) This paragraph applies where—

• (a) under section 102ZA of this Act, an individual (“D”) is taken to dispose of property by way of gift, and

• (b) the property continues to be settled property immediately after the disposal.

• (2) Paragraphs 2 to 4 above shall not apply but, subject to the following provisions of this paragraph, the principal section and the following provisions of this Schedule shall apply as if the property comprised in the gift consisted of the property comprised in the settlement on the material date, except in so far as that property neither is, nor represents, nor is derived from, property originally comprised in the gift.

• (3) Any property which—

• (a) on the material date is comprised in the settlement, and

• (b) is derived, directly or indirectly, from a loan made by D to the trustees of the settlement,

shall be treated for the purposes of sub-paragraph (2) above as derived from property originally comprised in the gift.

• (4) If the settlement comes to an end at some time before the material date as respects all or any of the property which, if D had died immediately before that time, would be treated as comprised in the gift,—

• (a) the property in question, other than property to which D then becomes absolutely and beneficially entitled in possession, and

• (b) any consideration (not consisting of rights under the settlement) given by D for any of the property to which D so becomes entitled,

shall be treated as comprised in the gift (in addition to any other property so comprised).

• (5) Where, under any trust or power relating to settled property, income arising from that property after the material date is accumulated, the accumulations shall not be treated for the purposes of sub-paragraph (2) above as derived from that property.

Sales to intermediaries.

Repurchases and stock lending.

The tax: introduction

Intermediaries: supplementary.

Section 87: exceptions for public issues.

Intermediaries: supplementary.

Intermediaries: supplementary.

Section 87: exceptions for public issues.

Section 99(4B): “listed” and “recognised growth market”

These repeals have effect in accordance with paragraphs 1(5) and 2(2) of Schedule 18 to this Act.

Clearance services: supplementary

The tax: introduction

Depositary receipts: exceptions

Liability to tax

Depositary receipts: supplementary

These repeals have effect in accordance with paragraphs 1(5) and 2(2) of Schedule 18 to this Act.

80D

• (1) This section applies where—

• (a) A and B have entered into an arrangement falling within section 80C(1),

• (b) the conditions in subsection (2A) or (3) of that section are met,

• (c) stock is transferred to A or A's nominee, and

• (d) the conditions in subsection (2) below are met.

• (2) The conditions in this subsection are that—

• (a) A and B are not connected persons within the meaning of section 1122 of the Corporation Tax Act 2010,

• (b) after B has transferred stock under the arrangement, A or B becomes insolvent,

• (c) it becomes apparent (whether before or after the insolvency occurs) that, as a result of the insolvency, stock will not be transferred to B or B's nominee in accordance with the arrangement,

• (d) the party who does not become insolvent (“the solvent party”) or the solvent party's nominee acquires replacement stock, and

• (e) the replacement stock is acquired before the end of the period of 30 days beginning with the day on which the insolvency occurs (“the insolvency date”).

• (3) Where collateral is provided under the arrangement (or under arrangements of which that arrangement forms part), stamp duty is not chargeable on any instrument transferring to the solvent party or the solvent party's nominee—

• (a) replacement stock acquired using the collateral (whether directly or indirectly), or

• (b) where the solvent party uses the whole of the value of the collateral to acquire replacement stock, any further replacement stock.

• (4) Where no collateral is provided as mentioned in subsection (3), stamp duty is not chargeable on any instrument transferring replacement stock to the solvent party or the solvent party's nominee.

• (5) Subsections (3) and (4) may apply as regards more than one instrument (and where those subsections apply as regards more than one instrument, the instruments may be executed by different persons).

• (6) But those subsections apply only as regards replacement stock up to the amount of stock which will not be transferred as a result of the insolvency.

• (7) An instrument on which stamp duty is not chargeable by virtue only of subsection (3) or (4) is not to be deemed to be duly stamped unless it has been stamped with a stamp denoting that it is not chargeable with any duty.

• (8) Despite section 122(1) of the Stamp Act 1891, the stamp mentioned in subsection (7) may be a stamp of such kind as the Commissioners for Her Majesty's Revenue and Customs may prescribe.

• (9) For the purposes of this section a person becomes insolvent—

• (a) if a company voluntary arrangement takes effect under Part 1 of the Insolvency Act 1986,

• (b) if an administration application (within the meaning of Schedule B1 to that Act) is made or a receiver or manager, or an administrative receiver, is appointed,

• (c) on the commencement of a creditor's voluntary winding up (within the meaning of Part 4 of that Act) or a winding up by the court under Chapter 6 of that Part,

• (d) if an individual voluntary arrangement takes effect under Part 8 of that Act,

• (e) on the making of a bankruptcy application or presentation of a bankruptcy petition (within the meaning of Part 9 of that Act),

• (f) if a compromise or arrangement takes effect under Part 26 or 26A of the Companies Act 2006,

• (g) if a bank insolvency order takes effect under Part 2 of the Banking Act 2009,

• (h) if a bank administration order takes effect under Part 3 of that Act,...

• (ha) if a special administration order takes effect under the Investment Bank Special Administration Regulations 2011, ...

• (hb) if a special administration order takes effect under the Payment and Electronic Money Institution Insolvency Regulations 2021, or

• (i) on the occurrence of any corresponding event which has effect under or as a result of the law of Scotland or Northern Ireland or a country or territory outside the United Kingdom.

• (10) In this section—

• “collateral” means an amount of money or other property which is payable to, or made available for the benefit of, a party to an arrangement or that party's nominee for the purpose of securing the discharge of the requirement to transfer stock to that party or the nominee;

• “replacement stock”, in the event of a party to an arrangement becoming insolvent, is stock of the same kind as the stock which will not be transferred to the other party or that party's nominee as a result of the insolvency.

89AB

• (1) This section applies where—

• (a) P and Q have entered into an arrangement falling within section 89AA(1),

• (b) the only reason that the conditions in subsection (2A) or (3) of that section are not met is that chargeable securities of the same kind and amount as those transferred to P or P's nominee are not transferred to Q or Q's nominee, and

• (c) the conditions in subsection (2) below are met.

• (2) The conditions in this subsection are that—

• (a) P and Q are not connected persons within the meaning of section 1122 of the Corporation Tax Act 2010,

• (b) after Q has transferred securities under the arrangement, either P or Q becomes insolvent,

• (c) it becomes apparent (whether before or after the insolvency occurs) that, as a result of the insolvency, securities will not be transferred to Q or Q's nominee in accordance with the arrangement.

• (3) Section 87 does not apply as regards an agreement to transfer chargeable securities to P or P's nominee, or Q or Q's nominee, in accordance with the arrangement.

• (4) Subsections (5) and (6) apply if—

• (a) the party who does not become insolvent (“the solvent party”) or the solvent party's nominee acquires replacement securities, and

• (b) the replacement securities are acquired before the end of the period of 30 days beginning with the day on which the insolvency occurs (“the insolvency date”).

• (5) Where collateral is provided under the arrangement (or under arrangements of which that arrangement forms part), section 87 does not apply as regards any agreement to transfer to the solvent party or the solvent party's nominee—

• (a) replacement securities acquired using the collateral (whether directly or indirectly), or

• (b) where the solvent party uses the whole of the value of the collateral to acquire replacement securities, any further replacement securities.

• (6) Where no collateral is provided as mentioned in subsection (5), section 87 does not apply as regards any agreement to transfer replacement securities to the solvent party or the solvent party's nominee.

• (7) Subsections (5) and (6) may apply as regards more than one agreement (and where those subsections apply as regards more than one agreement, the agreements may be with different persons).

• (8) But those subsections apply only as regards replacement securities up to the amount of securities which will not be transferred as a result of the insolvency.

• (9) For the purposes of this section a person becomes insolvent—

• (a) if a company voluntary arrangement takes effect under Part 1 of the Insolvency Act 1986,

• (b) if an administration application (within the meaning of Schedule B1 to that Act) is made or a receiver or manager, or an administrative receiver, is appointed,

• (c) on the commencement of a creditor's voluntary winding up (within the meaning of Part 4 of that Act) or a winding up by the court under Chapter 6 of that Part,

• (d) if an individual voluntary arrangement takes effect under Part 8 of that Act,

• (e) on the making of a bankruptcy application or presentation of a bankruptcy petition (within the meaning of Part 9 of that Act),

• (f) if a compromise or arrangement takes effect under Part 26 or 26A of the Companies Act 2006,

• (g) if a bank insolvency order takes effect under Part 2 of the Banking Act 2009,

• (h) if a bank administration order takes effect under Part 3 of that Act, ...

• (ha) if a special administration order takes effect under the Investment Bank Special Administration Regulations 2011, ...

• (hb) if a special administration order takes effect under the Payment and Electronic Money Institution Insolvency Regulations 2021, or

• (i) on the occurrence of any corresponding event which has effect under or as a result of the law of Scotland or Northern Ireland or a country or territory outside the United Kingdom.

• (10) In this section—

• “collateral” means an amount of money or other property which is payable to, or made available for the benefit of, a party to an arrangement or that party's nominee for the purpose of securing the discharge of the requirement to transfer securities to that party or the nominee;

• “replacement securities”, in the event of a party to an arrangement becoming insolvent, are chargeable securities of the same kind as the securities which will not be transferred to the other party or that party's nominee as a result of the insolvency.

Loan capital: new provisions.

Repurchases and stock lending.

Supplementary

Special cases.

Liability to tax

Repayment or cancellation of tax

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

These repeals have effect in accordance with paragraphs 1(5) and 2(2) of Schedule 18 to this Act.

97C

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

Depositary receipts: supplementary

Clearance services: exceptions

These repeals have effect in accordance with paragraphs 1(5) and 2(2) of Schedule 18 to this Act.

99A

• (1) This section applies for the purposes of section 99(4B).

• (2) Section 1005(3) to (5) of the Income Tax Act 2007 (meaning of “listed” etc) applies as it applies in relation to the Income Tax Acts.

• (3) “Recognised growth market” means a market recognised as a growth market by the Commissioners for Her Majesty's Revenue and Customs.

• (4) On an application made by a market, the market is to be recognised by the Commissioners as a growth market if, and only if, the Commissioners are satisfied, on the basis of evidence provided by the market, that the market qualifies for recognition.

• (5) A market qualifies for recognition at any time (“the relevant time”) if it is a recognised stock exchange or a qualifying UK multilateral trading facility which meets one or both of the following conditions—

• (a) a majority of the companies whose stock or marketable securities are admitted to trading on the market are companies with market capitalisations of less than £450 million;

• (b) the Commissioners are satisfied that the admission requirements of the market include provision requiring companies to demonstrate compounded annual growth in gross revenue or employment of at least 20% over the last three periods of account preceding admission (“the pre-admission periods”).

• (6) In subsection (5)—

• “period of account” of a company means a period for which the company draws up accounts;

• “recognised stock exchange” has the meaning given by section 1005(1) of the Income Tax Act 2007;

• “UK multilateral trading facility” has the meaning given by Article 2.1.14A of Regulation (EU) No. 600/2014 of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments as it forms part of assimilated law.

• (6A) For the purposes of subsection (5) a UK multilateral trading facility is “qualifying” if—

• (a) it is operated by an investment firm within the meaning given by article 3(1) of The Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (S.I. 2001/544), and