Legalize / United Kingdom / Public General Act

Income Tax Act 2007

Type Public General Act

Publication 2007-03-20

Last updated 2026-01-20

State In force

Department Statute Law Database

Source legislation.gov.uk

articles Not indexed

Reform history JSON API

1031

Schedule 3 (repeals and revocations, including of spent enactments) has effect.

Index of defined expressions

1032

(1) Schedule 4 (index of defined expressions that apply for the purposes of this Act) has effect.

(2) That Schedule lists the places where some of the expressions used in this Act are defined or otherwise explained.

Extent

1033

(1) This Act extends to England and Wales, Scotland and Northern Ireland (but see subsection (2)).

(2) An amendment, repeal or revocation contained in Schedule 1 or 3 has the same extent as the provision amended, repealed or revoked.

Commencement

1034

(1) This Act comes into force on 6 April 2007 and has effect—

(a) for income tax purposes, for the tax year 2007-08 and subsequent tax years, and

(b) for corporation tax purposes, for accounting periods ending after 5 April 2007.

(2) Subsection (1) is subject to subsections (3) and (4).

(3) The following—

(a) Part 5 (enterprise investment scheme),

(b) Part 3 of Schedule 1 (consequential amendment associated with Part 5), and

do not have effect in relation to shares issued before 6 April 2007.

This is subject to Schedule 2 (transitional provisions and savings).

(4) Subsection (1) does not apply to the following provisions of this Act (which therefore come into force on the day on which this Act is passed)—

(a) in Part 15, section 852, and

(b) in this Part, sections 1017, 1018, 1028, 1029, 1030(2) to (4) and 1033, this section and section 1035.

Short title

1035

This Act may be cited as the Income Tax Act 2007.

SCHEDULE 1

Part 1 — Income and Corporation Taxes Act 1988

1

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

2

Omit sections 1 to 2 (the charge to income tax, application of lower rate to income from savings and distributions, rates of tax applicable to distribution income etc, and fractions of a pound and yearly assessments).

3

Omit section 3 (certain income charged at basic rate).

4

Omit section 4 (construction of references in Income Tax Acts to deduction of tax).

5

Omit section 7(1) (deduction of income tax from payments to companies).

6

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

7

Omit section 42A (non-resident landlords and their representatives).

8

Omit sections 50, 51 and 51AA (United Kingdom securities: Treasury directions for payment without deduction of tax etc).

9

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

10

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

11

Omit section 109A (relief for post-cessation expenditure).

12

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

13

Omit section 117 (restriction on relief for limited partners: individuals).

14

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

15

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

16

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

17

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

18

Omit sections 118ZE to 118ZK (restriction on reliefs for non-active general partners and non-active members of LLPs).

19

Omit sections 118ZL and 118ZM (restriction on reliefs for partnerships exploiting films).

20

Omit sections 118ZN and 118ZO (partners: meaning of “contribution to the trade”).

21

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

22

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

23

Omit section 214(1)(b) (chargeable payments connected with exempt distributions: deduction of tax at source).

24

(1) Amend section 231AA (no tax credit for borrower under stock lending arrangement or interim holder under repurchase agreement) as follows.

(2) In subsection (1) omit “above or section 397(1) of ITTOIA 2005”.

(3) Omit subsection (1A).

25

(1) Amend section 231AB (no tax credit for original owner under repurchase agreement in respect of certain manufactured dividends) as follows.

(2) In subsection (1) omit “above or section 397(1) of ITTOIA 2005”.

(3) Omit subsection (1A).

26

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

27

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

28

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

29

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

30

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

31

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

32

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

33

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

34

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

35

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

36

(1) Amend section 266 (life assurance premiums) as follows.

(2) In subsection (3)(c) omit the words from “, except” to “subsection (6) below”.

(3) In subsection (4) for “subsections (6) to (8)” substitute “ subsections (7) and (8) ”.

(4) Omit subsections (6) and (6A).

(5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(6) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(7) In subsection (13) omit “this section and”.

37

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

38

Omit section 276 (effect on relief of charges on income).

39

Omit section 277 (partners).

40

(1) Amend section 278 (non-residents) as follows.

(2) Omit subsection (1).

(3) In subsection (2)—

(a) for the words from the beginning to “individual” substitute “ Subject to subsection (2ZA) below, relief under this Chapter shall be given only to an individual ”,

(b) before paragraph (a) insert—

(za) is not resident in the United Kingdom, (zb) does not meet the condition in section 56(3) of ITA 2007, and

, and

(4) After subsection (2) insert—

(2ZA) Relief under section 266 above (except relief given by virtue of subsection (7) of that section) may also be given to an individual who— (a) is resident in the United Kingdom, or (b) meets the condition in section 56(3) of ITA 2007.

41

Omit section 282 (construction of references to spouses or civil partners living together).

42

Omit sections 282A and 282B (jointly held property).

43

Omit section 305A (relief for loss on disposal of shares).

44

In section 312(2A) (interpretation of Chapter 3), as it applies in relation to shares issued before 6 April 2007, for paragraph (a) substitute—

(a) references to a company being “in administration” are to— (i) it being in administration within the meaning of Schedule B1 to the Insolvency Act 1986 (c. 45) or Schedule B1 to the Insolvency (Northern Ireland) Order 1989 (S.I. 1989/2405 (N.I. 19)), or (ii) there being in force in relation to it, under the law of a country or territory outside the United Kingdom, any appointment corresponding to an appointment of an administrator under either of those Schedules;

45

Omit section 320 (Commonwealth Agents-General and official agents etc).

46

Omit section 323 (visiting forces).

47

Omit section 332A (venture capital trusts: relief).

48

Omit section 334 (Commonwealth and Irish citizens temporarily abroad).

49

Omit section 335 (residence of persons working abroad).

50

Omit section 336 (temporary residents in the United Kingdom).

51

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

52

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

53

Omit section 347B (qualifying maintenance payments).

54

Omit section 348 (payments out of profits or gains brought into charge to income tax: deduction of tax).

55

Omit section 349 (payments not out of profits or gains brought into charge to income tax, and annual interest).

56

Omit section 349ZA (extension of section 349: proceeds of sale of UK patent rights).

57

Omit sections 349A to 349D (exceptions to section 349 for payments between companies).

58

Omit section 349E (deductions under section 349(1): payment of royalties overseas).

59

Omit section 350 (charge to tax where payments made under section 349).

60

Omit section 350A (UK public revenue dividends: deduction of tax).

61

Omit section 352 (certificates of deduction of tax).

62

(1) Amend section 353 (relief for payments of interest: general) as follows.

(2) In subsection (1)—

(a) omit “sections 359 to 368 of this Act and”, and

(b) for “sections 359 to 365” substitute “ section 365 ”.

(3) For subsection (1A) substitute—

(1A) Where a person is entitled for a year of assessment to relief under this section in respect of an amount of interest which is eligible for relief by virtue of section 365, the relief is given as a tax reduction for that tax year. (1AA) The amount of the tax reduction is 23% of the amount of the interest. (1AB) The tax reduction is given effect at Step 6 of the calculation in section 23 of ITA 2007.

(4) Omit subsection (1B).

(5) In subsection (1E)—

(a) omit “under this section”,

(b) for “subsection (1B) above” substitute “ section 383 of ITA 2007 (relief for interest payments) ”,

(d) for the words from “and subsection (1A) or (1B)” to the end substitute “ and subsection (1A) above or section 383 of ITA 2007 shall apply accordingly to the case in which that subsection or section applies ”.

(6) Omit subsections (1F) to (1H).

63

Omit section 359 (loan to buy machinery or plant).

64

Omit section 360 (loan to buy interest in close company).

65

Omit section 360A (meaning of “material interest” in section 360).

66

Omit section 361 (loan to buy interest in co-operative or employee-controlled company).

67

Omit section 362 (loan to buy into partnership).

68

Omit section 363 (provisions supplementary to sections 360 to 362).

69

Omit section 364 (loan to pay inheritance tax).

70

In section 366(1)(c) (information) omit the words from “(or” to “income)”.

71

In section 367 (provisions supplementary to sections 354 to 366) omit subsections (2) to (4).

72

Omit section 368 (exclusion of double relief etc).

73

Omit Chapter 1 of Part 10 (loss relief: income tax).

74

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

75

(1) Amend section 398 (transactions in deposits with and without certificates or in debts) as follows.

(2) For “a person” substitute “ a company ”.

(3) Omit “above or Chapter 11 of Part 4 of ITTOIA 2005 (transactions in deposits)”.

(4) In paragraph (a)—

(a) after “chargeable to” insert “ corporation ”, and

(b) omit “above or that Chapter”.

(5) In paragraph (b) for the words from “he is chargeable” to “that Act” substitute “ the company is chargeable to corporation tax under Schedule D ”.

(6) For the words from “the amount of his loss may be set off in pursuance” to the end substitute “ the amount of its loss may be set off under section 396. ”

76

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

77

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

78

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

79

In section 459 (exemption for unregistered friendly societies) omit “income tax and”.

80

In section 460(1) (exemption for registered friendly societies: life or endowment business) omit “income tax and”.

81

(1) Section 461 (exemption for registered friendly societies: other business) is amended as follows.

(2) In subsection (1) omit “income tax and”.

(3) In subsection (4)(b) omit “income tax or”.

82

(1) Amend section 461B (exemption for qualifying incorporated friendly societies: other business) as follows.

(2) In subsection (1) omit “income tax and”.

(3) In subsection (5) omit “income tax or”.

83

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

84

(1) Amend section 467(1) (exemption for trade unions and employers' associations) as follows.

(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) In paragraph (a) omit “to exemption from income tax and corporation tax”.

(4) In paragraph (b) omit “to exemption from tax”.

85

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

86

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

87

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

88

(1) Amend section 477A (building societies: regulations for deduction of tax) as follows.

(2) Omit subsections (1) to (2A).

(3) In subsection (3)—

(a) omit the words from “For any” to “above apply,”, and

(b) in paragraph (b) omit the words “paid or credited in the year of assessment”.

(4) Omit subsection (7).

(5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(6) In subsection (10) omit the definitions of “qualifying certificate of deposit”, “qualifying deposit right” and “security”.

(7) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

89

Omit sections 480A to 482 (deduction of tax by deposit-takers).

90

(1) Amend section 486 (industrial and provident societies and co-operative associations) as follows.

(2) Omit subsections (2), (3) and (6).

(3) In subsection (7) for “subsection (6)” substitute “ section 887(2) of ITA 2007 ”.

91

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

92

(1) Amend section 492 (treatment of oil extraction activities etc for tax purposes) as follows.

(2) Omit subsection (2).

(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

93

Omit section 504A (letting of furnished holiday accommodation treated as trade for certain income tax purposes).

94

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

95

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

96

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

97

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

98

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

99

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

100

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

101

(1) Amend section 510A (tax treatment of European Economic Interest Groupings) as follows.

(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) In subsection (3) omit paragraph (b) and the “and” immediately before it.

(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

102

Omit section 515 (exemption for signatories to Operating Agreement for INMARSAT).

103

Omit section 516 (Government securities held by non-resident central banks).

104

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

105

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

106

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

107

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

108

(1) Amend section 527 (spreading of royalties over several years) as follows.

(2) For subsection (1) substitute—

(1) Where— (a) a royalty or other sum is paid to a company in respect of the user of a patent, (b) the user extended over a period of six complete years or more, and (c) the payment is one from which a sum representing income tax must be deducted under section 903 of ITA 2007, the company may on the making of a claim require that the corporation tax payable by it by reason of the receipt of that sum shall be reduced so as not to exceed the total amount of corporation tax which would have been payable by it if that royalty or sum had been paid in six equal instalments at yearly intervals, the last of which was paid on the date on which the payment was in fact made.

(3) Omit subsection (4).

109

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

110

Omit sections 536 (taxation of royalties where owner abroad), 537 (public lending right) and 537B (taxation of design royalties where owner abroad).

111

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

112

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

113

Omit section 555 (entertainers and sportsmen: payment of tax).

114

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

115

In section 558 (supplementary provisions) omit subsections (1) to (4).

116

In section 571 (schemes for rationalising industry: cancellation of certificates) after subsection (1) insert—

(1A) An amount charged to income tax under subsection (1) above is treated for income tax purposes as an amount of income.

117

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

118

Omit section 574 (share loss relief for individuals).

119

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

120

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

121

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

122

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

123

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

124

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

125

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

126

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

127

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

128

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

129

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

130

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

131

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

132

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

133

Omit section 581A (interest on foreign currency securities etc).

134

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

135

Omit section 582A (designated international organisations: miscellaneous exemptions).

136

Omit section 587A (new issues of securities: extra return).

137

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

138

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

139

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

140

In section 615(3) (exemption from tax in respect of certain pensions) for “section 349(1)” substitute “ Chapter 6 of Part 15 of ITA 2007 (deduction from annual payments and patent royalties) ”.

141

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

142

In section 658(4)(b) (supplementary) omit “(notwithstanding anything in section 348)”.

143

In section 659E(1) (treatment of income from property investment LLPs) at the end insert “ (see section 1004 of ITA 2007) ”.

144

Omit section 660C(3) (nature of charge on settlor).

145

Omit sections 685A to 687 (liability of trustees).

146

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

147

Omit section 689A (disregard of trustees' expenses where beneficiary non-UK resident).

148

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

149

Omit sections 690 to 694.

150

Omit section 698A.

151

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

152

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

153

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

154

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

155

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

156

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

157

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

158

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

159

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

160

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

161

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

162

Omit sections 710 to 727A (accrued income scheme).

163

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

164

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

165

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

166

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

167

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

168

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

169

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

170

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

171

(1) Amend section 736B (deemed manufactured payments in the case of stock lending arrangements) as follows.

(2) In subsection (2)—

(a) after “that Schedule” insert “ , and section 97 of the Finance Act 1996 (loan relationships: manufactured interest), ”, and

(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) In subsection (2A)—

(a) in paragraph (a) omit “income tax or”, and

(b) in paragraph (b) omit “total income or, as the case may be,”.

172

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

173

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

174

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

175

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

176

(1) Amend section 737E (power to modify sections 727A, 730A, 730BB and 737A to 737C) as follows.

(2) In subsections (1) and (2) omit “727A,”.

(3) In subsections (4) and (6)(b) omit “or 263D”.

(4) In the sidenote omit “727A,”.

177

Omit sections 739 to 746 (transfer of assets abroad).

178

In section 747(4) (imputation of chargeable profits and creditable tax of controlled foreign companies) omit paragraph (b) and the “and” immediately before it.

179

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

180

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

181

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

182

Omit section 775 (sale by individual of income derived from his personal activities).

183

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

184

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

185

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

186

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

187

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

188

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

189

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

190

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

191

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

192

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

193

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

194

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

195

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

196

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

197

(1) Amend section 804 (relief against income tax in respect of income arising in years of commencement) as follows.

(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) Omit subsection (6).

198

(1) Amend section 807 (sale of securities with or without accrued interest) as follows.

(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(4) In the full-out words of subsection (1)—

(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b) omit “or corporation tax”.

(5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(6) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(7) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(8) Omit subsection (6).

199

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

200

In section 811(2) (deduction for foreign tax where no credit allowable)—

(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b) omit paragraph (b) and the “and” immediately after it.

201

In section 812(5) (withdrawal of right to tax credit of certain non-resident companies connected with unitary states) for paragraph (c) substitute—

(c) whether a person is connected with another is determined in accordance with section 839;

202

In section 816 (disclosure of information)—

(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b) omit subsection (3A).

203

Omit section 818 (arrangements for payments of interest less tax or of fixed net amount).

204

Omit section 819 (old references to standard rate tax).

205

In section 821(3) (under-deductions from payments made before passing of annual Act)—

(a) for paragraph (a) substitute—

(a) any payment to which section 906 of ITA 2007 applies (certain royalties etc where usual place of abode of owner is abroad), and

, and

(b) omit paragraph (aa) and the “and” immediately after it.

206

Omit section 823 (adjustments of reliefs where given at different times).

207

Omit section 827A (territorial scope of charges under certain provisions to which section 836B applies).

208

(1) Amend section 828 (orders and regulations made by the Treasury or the Board) as follows.

(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5) In subsection (4)—

(a) omit “1(6),”

(b) omit “257C, 582A(1),”, and

(6) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

209

Omit section 829 (application of Income Tax Acts to public departments and avoidance of exempting provisions).

210

In section 830(1) (territorial sea) omit “income tax and”.

211

In section 831(3) (interpretation of ICTA) after the definition of “ITTOIA 2005” insert—

“ITA 2007” means the Income Tax Act 2007;

212

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

213

Omit section 833 (interpretation of the Income Tax Acts).

214

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

215

Omit section 835 (“total income” in the Income Tax Acts).

216

Omit section 836 (returns of total income).

217

Omit section 836B (table of provisions to which that section applies).

218

Omit section 837 (“annual value” of land).

219

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

220

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

221

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

222

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

223

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

224

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

225

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

226

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

227

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

228

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

229

Omit section 842AA (venture capital trusts).

230

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

231

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

232

(1) Amend Schedule 14 (provisions ancillary to section 266) as follows.

(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) In paragraph 6(1) for “subsections (6) and (7)” substitute “ subsection (7) ”.

(4) In paragraph 8 after sub-paragraph (3) insert—

(3A) In sub-paragraph (3) “industrial assurance business” means any industrial assurance business within the meaning given by— (a) section 1(2) of the Industrial Assurance Act 1923, or (b) Article 3(1) of the Industrial Assurance (Northern Ireland) Order 1979, which was carried on before 1 December 2001.

233

In Part 1 of Schedule 15 (qualifying policies for the purposes of section 267) after paragraph 20 insert—

(20A) In this Part of this Schedule “industrial assurance business” means any industrial assurance business within the meaning given by— (a) section 1(2) of the Industrial Assurance Act 1923, or (b) Article 3(1) of the Industrial Assurance (Northern Ireland) Order 1979, which was carried on before 1 December 2001.

234

Omit Part 1 of Schedule 15B (venture capital trusts: relief from income tax).

235

Omit Schedule 16 (collection of income tax on company payments).

236

In paragraph 2(b) of Schedule 19B (petroleum extraction activities: exploration expenditure supplement) after “section 837B” insert “ of this Act and section 1003 of ITA 2007 ”.

237

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

238

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

239

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

240

Omit Schedule 28B (venture capital trusts: meaning of “qualifying holding”).

Part 2 — Other enactments

Chevening Estate Act 1959 (c. 49)

241

In section 2(1A)(a) of the Chevening Estate Act 1959 (provisions as to income tax, estate duty and stamp duty) for “section 505(1A) of the Income and Corporation Taxes Act 1988” substitute “ section 533(2) of the Income Tax Act 2007 ”.

Taxes Management Act 1970 (c. 9)

242

The Taxes Management Act 1970 is amended as follows.

243

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

244

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

245

(1) Amend section 12AB(1) (partnership return to include partnership statement) as follows.

(2) In paragraph (a)—

(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b) omit sub-paragraph (iv) and the “and” immediately before it.

(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

246

In section 12B(4A)(a) (records to be kept for purposes of returns) for sub-paragraph (ii) substitute—

(ii) section 495(1) or 975(2) or (4) of ITA 2007 (statements about deduction of income tax),

247

(1) Amend section 17 (interest paid or credited by banks etc without deduction of income tax or after deduction of income tax) as follows.

(2) In subsection (1) after “bank” insert “ or building society ”.

(3) In subsection (1A) for “section 840A of the principal Act” substitute “ section 991 of ITA 2007 ”.

(4) After subsection (6) insert—

(7) In the application of this section in relation to building societies, references to interest include references to dividends. For this purpose “dividend” includes any distribution (whether or not described as a dividend).

(5) In the sidenote after “banks” insert “ , building societies ”.

248

In section 21(5A) (transactions in securities etc) for “Schedule 23A to the principal Act” substitute “ Chapter 2 of Part 11 or Chapter 9 of Part 15 of ITA 2007 ”.

249

In section 24(3A) (power to obtain information as to income from securities) for “section 840A of the principal Act” substitute “ section 991 of ITA 2007 ”.

250

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

251

In section 36(3A) (fraudulent or negligent conduct)—

(a) after “section 257BA of the principal Act” insert “ or any of sections 47 to 49 of ITA 2007 ”, and

(b) for “(elections as to transfer of married couple's allowance)” substitute “ (tax reductions for married couples and civil partners: elections to transfer relief) ”.

252

(1) Amend section 37A (effect of assessment where allowances transferred) as follows.

(2) For “income tax reduction or deduction from total income” in both places where it occurs substitute “ deduction from net income or tax reduction ”.

(3) After “spouse” insert “ or civil partner ”.

(4) After “the principal Act” insert “ or section 39, 51 or 52 of ITA 2007 ”.

253

In section 42(7) (procedure for making claims etc)—

(a) in paragraph (a) omit “723(3),”,

(b) omit “and” at the end of paragraph (d), and

and (f) sections 668 and 669 of ITA 2007.

254

In section 43A(2A) (further assessments: claims etc)—

(a) in paragraph (a) after “section 257BA of the principal Act” insert “ or any of sections 47 to 49 of ITA 2007 ”,

(b) in paragraph (a) for “(election as to transfer of married couple's allowance)” substitute “(tax reductions for married couples and civil partners: elections to transfer relief)”, ...

255

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

256

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

257

In section 55(1) (recovery of tax not postponed)—

(a) omit paragraph (c), and

(b) in paragraph (d) for “that Act” substitute “ the principal Act ”.

258

For section 87 (interest on income tax on company payments) substitute—

(87) (1) Income tax which is assessable under Chapter 15 of Part 15 of ITA 2007 carries interest at the rate applicable under section 178 of the Finance Act 1989 from the date when it was due under section 951 of ITA 2007 until payment. (2) Subsection (1) applies— (a) whether or not an assessment is made, and (b) whether or not income tax which is assessed has been paid when the assessment is made. (3) Subsection (1) applies even if the date when the income tax should have been paid is a non-business day as defined by section 92 of the Bills of Exchange Act 1882. (4) Subsection (5) applies to any income tax which— (a) was payable under Chapter 15 of Part 15 of ITA 2007 (collection: deposit-takers, building societies and certain companies) in respect of payments within section 946 of that Act made in a return period, (b) was not paid on the date when it was due under section 951 of that Act, and (c) has subsequently been discharged or repaid under section 953 of that Act because the person who made the payments received payments on which it suffered income tax by deduction in a later return period. (5) The income tax carries interest under subsection (1) from the date when it was due under section 951 of ITA 2007 until the earliest of— (a) the date when the income tax was paid, (b) the date when the person delivered a return for the later return period, and (c) the expiry of 14 days after the end of that period, but subsection (1) does not otherwise apply to the income tax. (6) In this section “return period” means a period for which a return is required to be made under Chapter 15 of Part 15 of ITA 2007.

259

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

260

(1) Amend section 98 (special returns etc) as follows.

(2) In subsection (4A)(a) for “section 350(1) of, or Schedule 16 to, the principal Act” substitute “ Chapter 15 or 16 of Part 15 of ITA 2007 ”.

(3) In subsection (4B) for paragraphs (a) to (d) substitute—

(a) the payment is made by a company, local authority or qualifying partnership (within the meaning of section 932 of ITA 2007) without an amount representing income tax on the payment being deducted from it, (b) at the time the payment is made, the company, authority or partnership— (i) does not believe that the payment is an excepted payment for the purposes of Chapter 11 of Part 15 of ITA 2007 (payments between companies etc: exception from duties to deduct), or (ii) if it does so believe, cannot reasonably do so, (c) the payment is one from which tax is deductible under Part 15 of ITA 2007 unless the company, authority or partnership reasonably believes that it is an excepted payment for the purposes of Chapter 11 of that Part, and (d) the payment is not an excepted payment at the time the payment is made.

(4) Omit subsection (4C).

(5) For subsection (4D) substitute—

(4D) A payment is within this subsection if— (a) it is a payment from which a sum representing income tax must be deducted under Chapter 6 (deduction from annual payments and patent royalties) or 7 (deduction from other payments connected with intellectual property) of Part 15 of ITA 2007, (b) a company, purporting to rely on section 911 of that Act (double taxation arrangements: deduction at treaty rate), deducts less from the payment than required by those Chapters, and (c) at the time the payment is made the payee (as defined in section 913 of that Act) is not entitled to relief under double taxation arrangements (as defined in section 1023 of that Act) and the company— (i) does not believe that it is entitled to such relief, or (ii) if it does so believe, cannot reasonably do so.

(6) For subsection (4DA) substitute—

(4DA) A payment is within this subsection if— (a) it is a payment from which a sum representing income tax must be deducted under Chapter 6 (deduction from annual payments and patent royalties) or 7 (deduction from other payments connected with intellectual property) of Part 15 of ITA 2007, (b) a company, purporting to rely on section 914 of ITA 2007 (EU companies: discretion to make payment gross), makes the payment without deducting a sum representing income tax, and (c) at the time the payment is made the payment is not exempt from income tax as a result of section 758 of ITTOIA 2005 (exemption for certain interest and royalty payments) and the company— (i) does not believe that the payment is so exempt, or (ii) if it does so believe, cannot reasonably do so.

(7) In subsection (4E)(b) for “section 349(2) of the principal Act” substitute “ section 874 of ITA 2007 ”.

(8) In the first column of the Table—

(a) omit the entry relating to regulations under section 42A of ICTA,

(b) omit the entry relating to regulations under section 476(1) of ICTA,

(d) omit the entry relating to section 482(3) of ICTA,

(e) omit the entry relating to regulations under section 482(11) of ICTA,

(f) omit the entry relating to section 483 of ICTA,

(g) omit the entry relating to regulations under section 555(7) of ICTA,

(h) omit the entry relating to section 745(1) of ICTA,

(i) omit the entry relating to paragraph 5(2) of Schedule 15B to ICTA,

(j) omit the entry relating to regulations under paragraph 11B(5) of Schedule 28B to ICTA,

(k) omit the entry relating to section 86(12) of FA 1995,

(l) omit the entry relating to regulations under Schedule 33 to FA 2002, and

(m) at the end insert—

sections 242 and 243(1) and (2) of ITA 2007; section 271(2) of ITA 2007; regulations under Chapter 5 of Part 6 of ITA 2007; regulations under section 330(5) of ITA 2007; section 703 of ITA 2007; section 748(1) and (2) of ITA 2007; section 771 of ITA 2007; section 788 of ITA 2007; section 862 of ITA 2007; regulations under section 871(1) of ITA 2007; regulations under section 969(1) of ITA 2007; regulations under section 971(1) of ITA 2007; paragraph 155(5) of Schedule 2 to ITA 2007.

(9) In the second column of the Table—

(a) omit the entry relating to regulations under section 42A of ICTA,

(b) omit the entry relating to section 350(1) of ICTA,

(d) omit the entry relating to regulations under section 477A(1) of ICTA,

(e) omit the entry relating to section 482(2) of ICTA,

(f) omit the entry relating to regulations under section 482(11) of ICTA,

(g) omit the entry relating to regulations under section 555(7) of ICTA,

(h) omit the entry relating to paragraph 5(1) of Schedule 15B to ICTA,

(i) omit the entry relating to Schedule 16 to ICTA,

(j) omit the entry relating to regulations under Schedule 33 to FA 2002,

(k) omit the entry relating to regulations under section 122 of FA 2006, and

(l) at the end insert—

sections 240 and 241 of ITA 2007; section 271(1) of ITA 2007; regulations under Chapter 5 of Part 6 of ITA 2007; section 373 of ITA 2007; regulations under section 871(1) of ITA 2007; Chapter 15 of Part 15 of ITA 2007; Chapter 16 of Part 15 of ITA 2007; regulations under section 969(1) of ITA 2007; regulations under section 971(1) of ITA 2007; regulations under section 973(1) of ITA 2007.

(10) After the paragraph at the end of the Table insert— “ References in this Table to sections 240, 241, 242 and 243(1) and (2) of ITA 2007 are to provisions that apply only in relation to shares issued after 5 April 2007. ”

261

In section 99A (certificates of non-liability to income tax) for “section 477A of the principal Act (building societies) or section 480B of that Act (deposit-takers)” substitute “ section 852 of ITA 2007 ”.

262

After section 99A insert—

(99B) Where a person fraudulently or negligently gives any incorrect information in a declaration under any of sections 858 to 861 of ITA 2007, the person shall be liable to a penalty not exceeding £3,000.

263

In section 118(1) (interpretation)—

(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b) after the definition of “ITTOIA 2005” insert—

““ITA 2007” means the Income Tax Act 2007,”.

264

In paragraph 9(2) of Schedule 1A (claims etc not included in returns)—

(a) in paragraph (a) for “(personal reliefs for non-residents)” substitute “ or section 56 or 460 of ITA 2007 (residence etc of claimants) ”, and

(b) in paragraph (c) for “of that Act” substitute “ of the principal Act ”.

Finance Act 1971 (c. 68)

265

Omit section 21 of, and Schedule 3 to, the Finance Act 1971 (occupational pension schemes).

Biological Standards Act 1975 (c. 4)

266

In section 2(4A)(a) of the Biological Standards Act 1975 (general provisions about the Board) for “section 505(1A) of the Income and Corporation Taxes Act 1988” substitute “ section 533(2) of the Income Tax Act 2007 ”.

House of Commons Disqualification Act 1975 (c. 24)

267

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

Inheritance Tax Act 1984 (c. 51)

268

The Inheritance Tax Act 1984 is amended as follows.

269

In section 157(6) (non-residents' bank accounts) for “section 840A of the Taxes Act 1988” substitute “ section 991 of the Income Tax Act 2007 ”.

270

In section 204(5) (limitation of liability) for “section 739 or 740 of the Taxes Act 1988” substitute “ Chapter 2 of Part 13 of the Income Tax Act 2007 ”.

271

In section 272 (general interpretation) in the definition of “authorised unit trust” for the words from “section 469” to “section)” substitute “ the Income Tax Acts (see section 1007 of the Income Tax Act 2007) ”.

Administration of Justice Act 1985 (c. 61)

272

In paragraph 36(3) of Schedule 2 to the Administration of Justice Act 1985—

(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b) after “1988” insert “ and sections 749, 771(5) and (6) and 788(5) and (6) of the Income Tax Act 2007 ”.

Building Societies Act 1986 (c. 53)

273

In section 8(9) of the Building Societies Act 1986 (raising funds and borrowing) for “482(6) of the Income and Corporation Taxes Act 1988” substitute “ 866(2) and (3) of the Income Tax Act 2007 ”.

Finance Act 1988 (c. 39)

274

The Finance Act 1988 is amended as follows.

275

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

276

In Schedule 6 (commercial woodlands) omit paragraph 3(3) to (5).

277

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

Finance Act 1989 (c. 26)

278

The Finance Act 1989 is amended as follows.

279

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

280

In section 111 (residence of personal representatives)—

(a) omit subsections (1) to (3) and (6) to (8), and

(b) in subsection (5) omit the words “Subject to subsections (6) to (8) below,”.

281

(1) Amend section 151 (assessment of trustees and personal representatives) as follows.

(2) In subsection (2)(a) omit the words from “other” to “2005,”.

(3) Omit subsection (2)(b) and the “and” immediately before it.

(4) Omit subsection (3).

282

In section 182(3) (disclosure of information) at the end of paragraph (d) insert “ or section 704 of the Income Tax Act 2007 ”.

283

(1) Amend Schedule 5 (employee share ownership trusts) as follows.

(2) In paragraph 15 for “section 840 of the Taxes Act 1988” substitute “ section 995 of the Income Tax Act 2007 ”.

(3) In paragraph 16(2)—

(a) in paragraph (b) for “section 840 of that Act” substitute “ section 995 of the Income Tax Act 2007 ”, and

(b) in paragraph (c) for “that Act” substitute “ the Taxes Act 1988 ”.

Finance Act 1990 (c. 29)

284

(1) Amend section 25 of the Finance Act 1990 (c. 29) (donations to charity by individuals) as follows.

(2) Omit subsections (1) to (9A), (11) and (13).

(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Finance Act 1991 (c. 31)

285

The Finance Act 1991 (c. 31) is amended as follows.

286

Omit section 53 (Income Tax (Building Society) Regulations 1986).

287

Omit section 72 (deduction of trading losses).

288

The Social Security Contributions and Benefits Act 1992 (c. 4) is amended as follows.

289

In section 4A(3)(i)(i) (earnings of workers supplied by service companies etc) for “section 839 of the Income and Corporation Taxes Act 1988” substitute “ section 993 of the Income Tax Act 2007 ”.

290

(1) Amend Schedule 2 (levy of Class 4 contributions with income tax) as follows.

(2) In paragraph 1 after paragraph (ab) insert—

(ac) “ITA 2007” means the Income Tax Act 2007;

(3) In paragraph 3—

(a) in sub-paragraph (1)—

(i) for “the Act of 1988” substitute “ ITA 2007 ”,

(ii) in paragraph (a) for “sections 380 and 381” substitute “ sections 64 and 72 ”,

(iii) in paragraph (c) for “section 385” substitute “ section 83 ”, and

(iv) in paragraph (d) for “sections 388 and 389” substitute “ section 89 ”,

(b) in sub-paragraph (2)—

(i) omit “of the Act of 1988”,

(ii) in paragraph (a) after “Chapter I of Part VII” insert “ of the Act of 1988 and Chapters 2 and 3 of Part 3 and sections 457, 458 and 459 of ITA 2007 ”,

(iii) in paragraph (b) for “section 353” substitute “ section 383 of ITA 2007 ”,

(iv) omit paragraph (c), and

(v) in paragraph (d) for “section 390” substitute “ sections 88 and 94 of ITA 2007 ”,

(d) in sub-paragraph (5)—

(i) omit paragraph (a), and

(ii) in paragraph (b) for “section 353 of that Act” substitute “ section 383 of ITA 2007 ”.

(4) In paragraph 9(4) for “section 832 of the Act of 1988” substitute “ section 989 of ITA 2007 ”.

291

The Social Security Contributions and Benefits (Northern Ireland) Act 1992 is amended as follows.

292

293

(1) Amend Schedule 2 (Schedule 2 to the Social Security Contributions and Benefits Act 1992: levy of Class 4 contributions with income tax) as follows.

(2) In paragraph 1 after paragraph (ab) insert—

(ac) “ITA 2007” means the Income Tax Act 2007;

(3) In paragraph 3—

(a) in sub-paragraph (1)—

(i) for “the Act of 1988” substitute “ ITA 2007 ”,

(ii) in paragraph (a) for “sections 380 and 381” substitute “ sections 64 and 72 ”,

(iii) in paragraph (c) for “section 385” substitute “ section 83 ”, and

(iv) in paragraph (d) for “sections 388 and 389” substitute “ section 89 ”,

(b) in sub-paragraph (2)—

(i) omit “of the Act of 1988”,

(ii) in paragraph (a) after “Chapter I of Part VII” insert “ of the Act of 1988 and Chapters 2 and 3 of Part 3 and sections 457, 458 and 459 of ITA 2007 ”,

(iii) in paragraph (b) for “section 353” substitute “ section 383 of ITA 2007 ”,

(iv) omit paragraph (c), and

(v) in paragraph (d) for “section 390” substitute “ sections 88 and 94 of ITA 2007 ”,

(d) in sub-paragraph (5)—

(i) omit paragraph (a), and

(ii) in paragraph (b) for “section 353 of that Act” substitute “ section 383 of ITA 2007 ”.

(4) In paragraph 9(4) for “section 832 of the Act of 1988” substitute “ section 989 of ITA 2007 ”.

Taxation of Chargeable Gains Act 1992 (c. 12)

294

The Taxation of Chargeable Gains Act 1992 is amended as follows.

295

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

296

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

297

For section 11 (visiting forces, agents-general etc) substitute—

(11) (1) If section 833 of ITA 2007 (visiting forces and staff of designated allied headquarters) applies to an individual throughout a period, the period is not treated for capital gains tax purposes as— (a) a period of residence in the United Kingdom, or (b) creating a change of the individual's residence or domicile. (2) If an individual is entitled to immunity from income tax by virtue of section 841 of ITA 2007 (which provides immunity from income tax for official agents of Commonwealth countries or the Republic of Ireland etc), the individual is entitled to the same immunity from capital gains tax as that to which a member of the staff of a mission is entitled under the Diplomatic Privileges Act 1964. (3) “A member of the staff of a mission” is to be read in accordance with the Diplomatic Privileges Act 1964.

298

In section 16(1) (computation of losses) for “section 72 of the Finance Act 1991” substitute “ sections 261B, 261D and 263ZA ”.

299

In section 37 (consideration chargeable to tax on income) at the end insert—

(5) If— (a) because section 759(4) or (6) of ITA 2007 applies, the person charged to tax under Chapter 3 of Part 13 of that Act (transactions in land) is a person other than the person (“A”) by whom the gain was realised, and (b) the income tax has been paid, for the purposes of this section the amount charged to that tax is regarded as having been charged as the income of A. (6) If— (a) because section 777(5) of that Act applies, the person charged to tax under Chapter 4 of Part 13 of that Act (sales of occupation income) is a person other than the person (“B”)— (i) for whom the capital amount was obtained, or (ii) in the case of income treated as arising under section 779 of that Act, by whom the property or right was sold or realised, and (b) the income tax has been paid, for the purposes of this section the amount charged to that tax is regarded as having been charged as the income of B. (7) In subsection (6) “capital amount” has the same meaning as in Chapter 4 of Part 13 of that Act (sales of occupation income) (see section 777(7) of that Act).

300

In section 39 (exclusion of expenditure by reference to tax on income) after subsection (3) insert—

(4) If— (a) because section 759(4) or (6) of ITA 2007 applies, the person charged to tax under Chapter 3 of Part 13 of that Act (transactions in land) is a person other than the person (“A”) by whom the gain was realised, and (b) the income tax has been paid, for the purposes of this section the amount charged to that tax is regarded as having been charged as the income of A.

301

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

302

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

303

In section 98(2) (power to obtain information for purposes of sections 87 to 90)—

(a) for the words from the beginning to “745(1)” substitute “ Sections 748(3) to (5), 749 and 750 of ITA 2007 shall have effect in relation to subsection (1) above as they have effect in relation to section 748(1) and (2) of that Act ”, and

(b) in paragraph (a) for “Chapter III of Part XVII of the Taxes Act” substitute “ Chapter 2 of Part 13 of that Act ”.

304

In section 101B(1)(a) (transfer of a company's assets to VCT), for “section 842AA of the Taxes Act” substitute “ Part 6 of ITA 2007 ”.

305

In section 101C(7) (transfer within group to VCT), for “section 842AA of the Taxes Act” substitute “ Part 6 of ITA 2007 ”.

306

(1) Amend section 105A (shares acquired on the same day: elections for alternative treatment) as follows.

(2) In subsection (4)—

(a) after “Chapter 3 of Part 7 of the Taxes Act” insert “ , relief under Part 5 of ITA 2007 ”,

(b) after “section 299 of the Taxes Act” insert “ or section 246 of ITA 2007 ”,

(d) for “that section” substitute “ section 299 of the Taxes Act or subsection (4) of section 246 of ITA 2007 ”.

(3) In subsection (7)—

(a) after “Chapter 3 of Part 7 of the Taxes Act” insert “ or relief under Part 5 of ITA 2007 ”,

(b) for “that Act” substitute “ the Taxes Act or section 245 of ITA 2007 ”, and

(4) After subsection (8) insert—

(9) In this section references to Part 5 of ITA 2007 or any provision of that Part are to a Part or provision that applies only in relation to shares issued after 5 April 2007.

307

In section 108(1)(a) (identification of relevant securities) for “section 710 of the Taxes Act” substitute “ Chapter 2 of Part 12 of ITA 2007 (accrued income profits) ”.

308

(1) Amend section 119 (transfer of securities subject to the accrued income scheme) as follows.

(2) For subsections (1) to (5) substitute—

(1) Where there is a transfer of securities within the meaning of Chapter 2 of Part 12 of ITA 2007 (accrued income profits)— (a) if a payment is treated as made to the transferor under section 632 of that Act or by the transferor under section 633 of that Act, section 37 shall be disregarded in computing the gain accruing on the disposal concerned; (b) if a payment is treated as made by the transferee under section 632 of that Act or to the transferee under section 633 of that Act, section 39 shall be disregarded in computing the gain accruing to the transferee if he disposes of the securities; but subsections (2) and (3) below shall apply. (2) Where the securities are transferred with accrued interest (within the meaning of that Chapter)— (a) if a payment is treated as made to the transferor under section 632 of ITA 2007, an amount equal to the amount of that payment shall be excluded from the consideration mentioned in subsection (8) below; (b) if a payment is treated as made by the transferee under that section, an amount equal to the amount of that payment shall be excluded from the sums mentioned in subsection (9) below. (3) Where the securities are transferred without accrued interest (within the meaning of that Chapter)— (a) if a payment is treated as made by the transferor under section 633 of ITA 2007, an amount equal to the amount of that payment shall be added to the consideration mentioned in subsection (8) below; (b) if a payment is treated as made to the transferee under that section, an amount equal to the amount of that payment shall be added to the sums mentioned in subsection (9) below. (3A) Subsections (3B) and (3C) below apply where there is a transfer of variable rate securities (within the meaning of that Chapter) and— (a) the transferor is treated as making accrued income profits under section 630(2) of ITA 2007, or (b) a payment is treated as made to the transferor under section 635 of that Act. (3B) Section 37 shall be disregarded in computing the gain accruing on the disposal concerned. (3C) An amount equal to the amount of the profits or payment shall be excluded from the consideration mentioned in subsection (8) below. (4) Where there is a transfer of securities with unrealised interest (within the meaning of Chapter 2 of Part 12 of ITA 2007)— (a) if section 630 of that Act applies or a payment is treated as made to the transferor under section 634 of that Act, section 37 shall be disregarded in computing the gain accruing on the disposal concerned, but the relevant amount shall be excluded from the consideration mentioned in subsection (8) below; (b) if section 681 of that Act applies, section 39 shall be disregarded in computing the gain accruing on the disposal concerned, but the relevant amount shall be excluded from the sums mentioned in subsection (9) below. (5) In subsection (4) above “the relevant amount” means an amount equal to— (a) if paragraph (b) below does not apply, the amount of the unrealised interest in question (within the meaning of Chapter 2 of Part 12 of ITA 2007); (b) if section 660 of that Act applies— (i) in a case falling within subsection (4)(a) above, the amount taken, by virtue of section 660 or 661 of that Act (as the case may be), to be the unrealised interest value for the purposes of section 660(2) or (3) of that Act; (ii) in a case falling within subsection (4)(b) above, the amount of income that is exempt from liability to income tax under section 681 of that Act.

(3) In subsection (6) for the words from “as if” to the end substitute “as if for “ is treated as made ”, in each place where it occurs, there were substituted “would, if the disposal were a transfer, be treated as made”.”

(4) For subsection (7) substitute—

(7) Where there is a disposal of securities for the purposes of this Act which is not a transfer (within the meaning of Chapter 2 of Part 12 of ITA 2007) but, if it were such a transfer, a payment would be treated as made under section 632 or 633 of that Act, the securities shall be treated— (a) for the purposes of subsection (6) above, as transferred on the day of the disposal, and (b) for the purposes of subsections (2) and (3) above, as transferred with accrued interest if, had the disposal been a transfer within the meaning of that Chapter, it would have been a transfer with accrued interest and as transferred without accrued interest if, had the disposal been such a transfer, it would have been a transfer without accrued interest. (7A) In relation to any securities which by virtue of subsection (7B) below are treated for the purposes of this subsection as having been transferred, subsection (3A) above shall have effect as if— (a) for “is treated as making” there were substituted “ would, if the disposal were a transfer, be treated as making ”, and (b) for “is treated as made” there were substituted “ would, if the disposal were a transfer, be treated as made ”. (7B) Where there is a disposal of securities for the purposes of this Act which is not a transfer (within the meaning of Chapter 2 of Part 12 of ITA 2007) but, if it were such a transfer, the transferor would be treated as making accrued income profits under section 630(2) of that Act in respect of a transfer of variable rate securities or a payment would be treated as made under section 635 of that Act— (a) the securities shall be treated, for the purposes of subsection (7A) above, as transferred on the day of the disposal, and (b) the transfer shall be treated, for the purposes of subsection (3A) above, as a transfer of variable rate securities.

(5) In subsection (10) for the words from “a person is treated”, in the first place where it occurs, to “(determined under that section)”, in the first place it occurs, substitute “ a payment is treated as made to a person under section 632 or 635 of ITA 2007, or a person is treated as making accrued income profits under section 630(2) of that Act in respect of a transfer of variable rate securities, an amount equal to the amount of the payment or profits ”.

(6) In the full-out words of subsection (10) for the words from “a person is treated” to “(determined under that section)” substitute “ a payment is treated as made by a person under section 633 of that Act an amount equal to the amount of the payment ”.

309

After section 125 insert—

(125A) (1) If loss relief under section 573 of the Taxes Act or Chapter 6 of Part 4 of ITA 2007 (“share loss relief”) is obtained in respect of a loss or any part of a loss, no deduction is to be made in respect of the loss or (as the case may be) the part under this Act. (2) If a claim is made for share loss relief in respect of a loss accruing on the disposal of shares, section 30 has effect in relation to the disposal as if for the references in subsections (1)(b) and (5) to a tax-free benefit there were substituted references to any benefit whether tax-free or not. (3) All such adjustments of corporation tax on chargeable gains or capital gains tax are to be made, whether by way of assessment or by way of discharge or repayment of tax, as may be required in consequence of— (a) share loss relief being obtained in respect of an allowable loss, or (b) such relief not being obtained in respect of the whole or part of such a loss in respect of which a claim is made.

310

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

311

(1) Amend section 150A (enterprise investment schemes) as follows.

(2) In subsection (2) after “section 312 (1A)(a) of the Taxes Act” insert “ or section 159(2) of ITA 2007 ”.

(3) In subsection (3) for paragraphs (a), (aa) and (b) substitute—

(a) an individual's liability to income tax has been reduced (or treated by virtue of section 304 of the Taxes Act or section 245 of ITA 2007 (spouses and civil partners) as reduced) for any year of assessment under section 289A of the Taxes Act or section 158 of ITA 2007 in respect of any issue of shares, (b) the amount of the reduction (“A”) is less than the amount (“B”) which is equal to tax at the savings rate for that year on the amount subscribed for the issue, and (c) A is not found under section 289A(2)(b) of the Taxes Act or (as the case may require) is not within paragraph (b) solely by virtue of section 29(2) and (3) of ITA 2007,

(4) In subsection (4) after “the Taxes Act” insert “ or as provided by section 246 of ITA 2007 ”.

(5) In subsection (8B) for the words from “subsection (2)” to the end substitute “ section 306(2) of the Taxes Act or section 203(1) of ITA 2007 and in accordance with section 306 of the Taxes Act or sections 204 and 205 of ITA 2007 ”.

(6) In subsection (8C) after “Taxes Act” insert “ or section 159(2) of ITA 2007 ”.

(7) In subsection (8D)—

(a) after “section 304A of the Taxes Act” insert “ or section 247 of ITA 2007 ”, and

(b) for paragraph (b) substitute—

(b) the following— (i) subsections (2)(b), (3) and (4) of section 304A of the Taxes Act and subsection (5) of that section so far as relating to section 306(2) of that Act, or (ii) sections 247(3)(b), 248(2)(a) and 249 of ITA 2007, shall apply for the purposes of this section as they apply for the purposes of Chapter 3 of Part 7 of the Taxes Act or Part 5 of ITA 2007.

(8) In subsection (10A) for “the same meaning as in the Taxes Act” substitute “ the meaning given in section 989 of ITA 2007 ”.

(9) In subsection (11)—

(a) after “Taxes Act” insert “ or Part 5 of ITA 2007 ”, and

(b) after “that Chapter” insert “ or means shares that meet the requirements of section 173(2) of ITA 2007 ”.

(10) After subsection (12) insert—

(13) References in this section to Part 5 of ITA 2007 or any provision of that Part are to a Part or provision that applies only in relation to shares issued after 5 April 2007.

312

(1) Amend section 150B (enterprise investment scheme: reduction of relief) as follows.

(2) In subsection (1)—

(a) after “section 300(1A)(a) of the Taxes Act” insert “ or section 213(2)(a) of ITA 2007 ”, and

(b) for “that Act” substitute “ the Taxes Act or section 224(2)(a) of ITA 2007 ”.

(3) In subsection (6) for “Subsections (11) and (12)” substitute “ Subsections (11) to (13) ”.

313

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

314

In section 151A(7) (venture capital trusts: reliefs) for “the meaning of the Taxes Act” substitute “ the meaning given in section 989 of ITA 2007 ”.

315

(1) Amend section 151B (VCTs: supplementary) as follows.

(2) In subsection (3)—

(a) in paragraph (a) for “been given” substitute “ obtained ” and for “Part 1 of Schedule 15B to the Taxes Act” substitute “ Chapter 2 of Part 6 of ITA 2007 ”, and

(b) in paragraphs (b) and (c) for “been given” substitute “ obtained ” and for “that Part of that Schedule” substitute “ that Chapter of that Part ”.

(3) In subsection (6)(b) for “section 842AA(8) of the Taxes Act” substitute “ section 281(3) of ITA 2007 ”.

(4) In subsection (8)(b) for “given” substitute “ obtained ” and for “Part 1 of Schedule 15B to the Taxes Act” substitute “ Chapter 2 of Part 6 of ITA 2007 ”.

316

After section 151B insert—

(151BA) (1) This section applies for the purpose of identifying the securities or shares disposed of in any case where— (a) an individual or company (“the investor”) disposes of part of a holding of securities or shares (“the holding”), and (b) the holding includes securities or shares to which CITR is attributable in respect of one or more years of assessment or accounting periods that have been held by the investor continuously from the time they were issued until the disposal. (2) Any disposal by the investor of securities or shares included in the holding which have been acquired by the investor on different days is treated as relating to those acquired on an earlier day rather than to those acquired on a later day. (3) If there is a disposal by the investor of securities or shares included in the holding which have been acquired by the investor on the same day, any of those securities or shares— (a) to which CITR is attributable, and (b) which have been held by the investor continuously from the time they were issued until the time of disposal, are treated as disposed of after any other securities or shares included in the holding which were acquired by the investor on that day. (4) For the purposes of this section a holding of securities is any number of securities of a company which— (a) carry the same rights, (b) were issued under the same terms, and (c) are held by the investor in the same capacity. It does not matter for this purpose that the number of the securities grows or diminishes as securities carrying those rights and issued under those terms are acquired or disposed of. (5) For the purposes of this section a holding of shares is any number of shares in a company which— (a) are of the same class, and (b) are held by the investor in the same capacity. It does not matter for this purpose that the number of the shares grows or diminishes as shares of that class are acquired or disposed of. (6) Chapter 1 of Part 4 (share pooling, etc) has effect subject to this section. (7) Sections 104 to 107 (which make provision for the identification of securities and shares on a disposal) do not apply to securities or shares to which CITR is attributable. (8) In a case to which section 127 (equation of original shares and new holding) applies, shares included in the new holding are treated for the purposes of subsections (2) and (3) as acquired when the original shares were acquired. (9) In subsection (8)— (a) the reference to section 127 includes a reference to that section as it is applied by virtue of any enactment relating to chargeable gains, and (b) “original shares” and “new holding” have the same meaning as in section 127, or (as the case may be) that section as applied by virtue of the enactment in question. (10) In this section and sections 151BB and 151BC— (a) if the investor is an individual— (i) “CITR” has the meaning given by section 333 of ITA 2007, (ii) references to CITR being attributable to securities, shares or debentures are to be read in accordance with section 357 of that Act, and (iii) references to securities, shares or debentures having been held by the investor continuously are to be read in accordance with section 380 of that Act, (b) if the investor is a company— (i) “CITR” means relief under Part 5 of Schedule 16 to the Finance Act 2002, (ii) references to CITR being so attributable are to be read in accordance with paragraph 26 of that Schedule, and (iii) references to securities, shares or debentures having been held by the investor continuously are to be read in accordance with paragraph 49 of that Schedule.

317

After section 151BA insert—

Reading this document does not replace reading the official text published on legislation.gov.uk. Contains public sector information licensed under the Open Government Licence v3.0. We assume no responsibility for any inaccuracies arising from the conversion of the original CLML XML to this format.

This text is published under legislation.gov.uk's own terms of reuse, not a Legalize or public-domain licence. legislation.gov.uk
Open Government Licence v3.0 (attribution required)
© Crown and database right. Derived from content available under the Open Government Licence v3.0 from legislation.gov.uk.