Finance Act 2013

(5A) (1) In paragraph 5 “non-qualifying individual”, in relation to a chargeable transaction, means any of the following— (a) the purchaser (other than a purchaser entering into the transaction as a member of a partnership); (b) a purchaser who enters into the transaction as a member of a partnership and has a major share in the partnership, (c) an individual (a “connected person”) who is connected with the purchaser; (d) a relevant settlor; (e) the spouse or civil partner of a connected person or of a relevant settlor; (f) a relative of a connected person or of a relevant settlor, or the spouse or civil partner of a relative of a connected person or of a relevant settlor; (g) a relative of the spouse or civil partner of a connected person or of a relevant settlor; (h) the spouse or civil partner of a person falling within paragraph (g); (i) an individual who is a major participant in a relevant collective investment scheme or is connected with a major participant in a relevant collective investment scheme. (2) A member of a partnership has a “major share” in the partnership if the member is entitled to a 50% or greater share— (a) in the income profits of the partnership, or (b) in the partnership's assets. (3) A collective investment scheme is a “relevant collective investment scheme” for the purposes of sub-paragraph (1)(i) if the purchaser under the chargeable transaction referred to in that sub-paragraph acquires the subject-matter of the transaction for the purposes of that scheme. (4) An individual who participates in a collective investment scheme is a “major participant” in the scheme if the individual— (a) is entitled to a share of at least 50% either of all the profits or income arising from the scheme or of any profits or income arising from the scheme that may be distributed to participants, or (b) would in the event of the winding up of the scheme be entitled to 50% or more of the assets of the scheme that would then be available for distribution among the participants. (5) The reference in sub-paragraph (4)(a) to profits or income arising from a collective investment scheme is to profits or income arising from the acquisition, holding, management or disposal of the property subject to the scheme. (6) In this paragraph— - “participant”, in relation to a collective investment scheme, is to be read in accordance with section 235 of the Financial Services and Markets Act 2000; - “relative” means brother, sister, ancestor or lineal descendant; - “relevant settlor”, in relation to a chargeable transaction, means an individual who is a settlor in relation to a relevant settlement (as defined in sub-paragraph (7)); - “settlement” has the same meaning as in Chapter 5 of Part 5 of ITTOIA 2005 (see section 620 of that Act). (7) Where a person, in the capacity of trustee of a settlement, is connected with a person who is the purchaser under a chargeable transaction, that settlement is a “relevant settlement” in relation to the chargeable transaction. (8) In sub-paragraph (7) “trustee” is to be read in accordance with section 1123(3) of CTA 2010 (“connected persons”: supplementary). (9) In this paragraph “the purchaser”, in relation to a chargeable transaction, is to be read as a reference to any of the purchasers (if there are more than one). (10) Section 1122 of the Corporation Tax Act 2010 (connected persons) has effect for the purposes of this paragraph, but for those purposes— (a) subsections (7) and (8) of that section (application of rules about connected persons to partnerships) are to be disregarded, and (b) subsections (2) to (7) of section 172 of the Finance Act 2013 apply as they apply for the purposes of Part 3 of that Act. (5B) (1) Paragraph 3 does not apply to a chargeable transaction so far as its subject-matter consists of a higher threshold interest in relation to which the conditions in sub-paragraph (2) are met. (2) The conditions are that— (a) the higher threshold interest is acquired with the intention that it will be exploited as a source of income in the course of a qualifying trade, and (b) reasonable commercial plans have been formulated to carry out that intention without delay (except so far as delay may be justified by commercial considerations or cannot be avoided). (3) “Qualifying trade”, in relation to a higher threshold interest, means a trade that— (a) is carried on on a commercial basis and with a view to profit, and (b) involves, in its normal course, offering the public the opportunity to make use of, stay in or otherwise enjoy the dwelling as customers of the trade on at least 28 days in any calendar year. (4) For the purposes of sub-paragraph (3), persons are not considered to have the opportunity to make use of, stay in or otherwise enjoy a dwelling unless the areas that they have the opportunity to make use of, stay in or otherwise enjoy include a significant part of the interior of the dwelling. (5) The size (relative to the size of the whole dwelling), nature and function of any relevant area or areas in a dwelling are taken into account in determining whether they form a significant part of the interior of the dwelling. (5C) (1) Sub-paragraph (2) applies to a chargeable transaction if the purchaser is a financial institution carrying on a business that involves the lending of money. (2) Paragraph 3 does not apply to the chargeable transaction so far as its subject-matter consists of a higher threshold interest that is acquired in the course of that business— (a) for the purpose of resale in the course of the business and, (b) in connection with those lending activities. (5D) (1) Paragraph 3 does not apply to a chargeable transaction so far as its subject-matter consists of a higher threshold interest in relation to which the conditions in sub-paragraph (2) are met. Those conditions can only be met if the purchaser, or a relevant group member, carries on or is to carry on a relievable trade. (2) The conditions are that— (a) the interest is acquired for the purpose of making the dwelling available to one or more qualifying employees or qualifying partners for use as living accommodation, and (b) the dwelling is to be made available as mentioned in paragraph (a) for purposes that are solely or mainly purposes of the relievable trade. (3) For the purposes of the relief under this paragraph it does not matter whether or not the individuals mentioned in sub-paragraph (2)(a) are identified at the time of the chargeable transaction. (4) “Relievable trade” means a trade that is carried on on a commercial basis and with a view to profit. (5) In this paragraph references to making a dwelling available to a qualifying employee or qualifying partner include making it available to persons who are to share the accommodation with a qualifying employee or qualifying partner as that individual's family. (6) Where the purchaser is a company, “relevant group member” means a company which is a member of the same group of companies as the purchaser for the purposes mentioned in paragraph 1(2) of Schedule 7 (group relief). (5E) (1) In a case where the person carrying on the relievable trade mentioned in paragraph 5D(1) carries it on in partnership with one or more other persons, “qualifying partner” means any individual who is a member of the partnership. (2) “Qualifying employee” means an individual employed for the purposes of the qualifying trade. (3) In a case falling within sub-paragraph (1), the condition in paragraph 5D(2)(a) is taken not to be met if the individuals, or a class of individuals, to whom it is proposed to make the dwelling available for use as living accommodation include, or are likely to include, a member of the partnership who is (or will at the relevant time be) entitled to a 10% or greater share— (a) in the income profits of the partnership, or (b) in any company beneficially entitled to the higher threshold interest mentioned in paragraph 5D(1), or (c) in that higher threshold interest. (4) In addition, the condition in paragraph 5D(2)(a) is taken not to be met if the individuals, or a class of individuals, to whom it is proposed to make the dwelling available for use as living accommodation include, or are likely to include, an individual employed for the purposes of the trade in question who is (or will at the relevant time be)— (a) entitled to a 10% or greater share— (i) in the income profits of the trade, or (ii) in any company that is beneficially entitled to the higher threshold interest, or (iii) in that higher threshold interest, or (b) employed to provide excluded domestic services. (5) The reference in sub-paragraph (4)(b) to an individual employed to provide excluded domestic services is to an individual the duties of whose employment include the provision of services in connection with the (actual or intended) occupation, by an individual to whom sub-paragraph (6) applies, of the dwelling mentioned in paragraph 5D(2)(a) (“the relevant dwelling”), or a linked dwelling. (6) This sub-paragraph applies to any individual who is connected with a person who is or is to be beneficially entitled to the higher threshold interest. (7) The following are “linked” dwellings for the purposes of sub-paragraph (5)— (a) if the conditions in section 116(2) of the Finance Act 2013 are met in relation to the relevant dwelling and another dwelling, that other dwelling; (b) a dwelling that is linked to the relevant dwelling, as described in section 117(1) of the Finance Act 2013. (8) For the purposes of sub-paragraphs (3)(c) and (4)(a) persons who are entitled to a chargeable interest as beneficial joint tenants (or, in Scotland, as joint owners) are taken to be entitled to the chargeable interest as beneficial tenants in common (or, in Scotland, as owners in common) in equal shares. (9) Section 147 of the Finance Act 2013 (meaning of “10% or greater share in a company”) applies for the purposes of this paragraph as for the purposes of section 146 of that Act. (10) In this paragraph references to employment include the holding of an office. (5F) (1) Paragraph 3 does not apply to a chargeable transaction so far as its subject-matter consists of a higher threshold interest in or over a dwelling— (a) that is, or is to be, a farmhouse, and (b) in relation to which the conditions in sub-paragraph (3) are met. (2) The reference in sub-paragraph (1) to a dwelling that “is or is to be a farmhouse” is to a dwelling that forms part of land that is to be occupied, or to continue to be occupied, for the purposes of a qualifying trade of farming. (3) The conditions are that— (a) the dwelling is to be occupied for the purposes of that trade by a qualifying farm worker, (b) reasonable commercial plans have been formulated under which such occupation is either to continue from the effective date of the chargeable transaction or to begin without delay (except so far as delay may be justified by commercial considerations or cannot be avoided), and (c) occupation of the farmhouse by a qualifying farm worker is then expected to continue as part of the normal way in which the trade is, or is to be, carried on. (4) In sub-paragraph (3) “qualifying farm worker” means an individual who occupies the dwelling for the purposes of the trade mentioned in that sub-paragraph and has a substantial involvement— (a) in the day-to-day work of the trade, or (b) in the direction and control of the conduct of the trade. (5) “Qualifying trade of farming” means a trade of farming that is carried on— (a) on a commercial basis, and (b) with a view to profit. (6) A person occupying part of a dwelling is regarded as occupying the dwelling for the purposes of this paragraph. (7) In this paragraph— (a) “farming” has the same meaning as in the Corporation Tax Acts (see section 1125 of CTA 2010), except that in this paragraph “farming” includes market gardening; (b) “market gardening” has the same meaning as in the Corporation Tax Acts (see section 1125(5) of CTA 2010). (5G) (1) Sub-paragraph (2) applies where relief under paragraph 5 has been allowed in respect of a higher threshold interest forming the whole or part of the subject-matter of a chargeable transaction. (2) The relief is withdrawn if at any time in the period of three years beginning with the effective date of the chargeable transaction (“the control period”) a requirement in sub-paragraph (3) is not met. (3) The requirements are that— (a) the higher threshold interest (if still held by the purchaser) is held exclusively for one or more of the purposes mentioned in paragraph 5(1), (b) any chargeable interest derived from the higher threshold interest that may be held by the purchaser is held exclusively for one or more of those purposes, and (c) (if the higher threshold interest or a chargeable interest derived from it is held by the purchaser) no non-qualifying individual is permitted to occupy the dwelling. (4) The requirements in sub-paragraph (3)(a) and (b) do not apply in relation to times when, because of a change of circumstances that is unforeseen and beyond the purchaser's control, it is not reasonable to expect the purposes for which the higher threshold interest was acquired to be carried out. (5) Sub-paragraph (6) applies if a higher threshold interest was acquired for a purpose mentioned in paragraph 5(1) but at some time in the control period the activity in question (for instance, exploitation of the interest as mentioned in paragraph 5(1)(a))— (a) has not yet begun, or (b) has ceased. (6) For the purposes of sub-paragraph (3), the interest is taken to be held for the purpose in question only if reasonable steps are being taken to ensure that the purpose in question is carried out. (7) In this paragraph “non-qualifying individual” (in relation to the chargeable transaction mentioned in sub-paragraph (1)) has the meaning given by paragraph 5A. (5H) (1) This paragraph applies where relief under paragraph 5B (trades involving making a dwelling open to the public) has been allowed in respect of a higher threshold interest forming the whole or part of the subject-matter of a chargeable transaction. (2) The relief is withdrawn if at any time in the period of three years beginning with the effective date of the chargeable transaction (“the control period”) a requirement in sub-paragraph (3) is not met. (3) The requirements are that— (a) the higher threshold interest (if still held by the purchaser), is being exploited as a source of income in the course of a qualifying trade, and (b) any chargeable interest derived from that interest that may be held by the purchaser is being exploited as mentioned in paragraph (a). (4) The requirements in sub-paragraph (3) do not apply in relation to times when, because of a change of circumstances that is unforeseen and beyond the purchaser's control, it is not reasonable to expect the chargeable interest concerned to be exploited in the manner specified. (5) Sub-paragraph (6) applies if at some time in the control period the higher threshold interest, or a chargeable interest derived from it— (a) has not begun to be exploited as mentioned in sub-paragraph (3), or (b) has ceased to be so exploited. (6) The requirements in sub-paragraph (3) are treated as being met if reasonable steps are being taken to ensure that the chargeable interest in question begins to be exploited as mentioned in that sub-paragraph, or that such exploitation of the interest is resumed. (5I) (1) This paragraph applies where relief under paragraph 5C (financial institutions acquiring dwellings in the course of lending) has been allowed in respect of a higher threshold interest forming the whole or part of the subject-matter of a chargeable transaction. (2) The relief is withdrawn if any requirement in sub-paragraph (3) is not met at any time in the period of three years beginning with the effective date of the chargeable transaction (“the control period”) (but see sub-paragraphs (4) and (5)). (3) The requirements are that— (a) the purchaser continues to be a financial institution carrying on a business that involves the lending of money, and (b) the interest is held for the purpose of resale in the course of the business. (4) The requirements in sub-paragraph (3) apply only to times in the control period when the purchaser holds— (a) the higher threshold interest, or (b) a chargeable interest that is derived from the higher threshold interest. (5) The requirements in sub-paragraph (3) do not apply in relation to times when, because of a change of circumstances that is unforeseen and beyond the purchaser's control, it is not reasonable to expect those requirements to be met. (5J) (1) This paragraph applies where relief under paragraph 5D (dwellings for occupation by certain employees etc) has been allowed in respect of a higher threshold interest forming the whole or part of the subject-matter of a chargeable transaction. (2) The relief is withdrawn if any requirement in sub-paragraph (3) is not met at any time in the period of three years beginning with the effective date of the chargeable transaction (“the control period”) (but see sub-paragraphs (4) and (5)). (3) The requirements are that— (a) the purchaser, or a relevant group member (as defined in paragraph 5D(6)), carries on a trade on a commercial basis and with a view to profit, (b) the dwelling is made available as mentioned in paragraph 5D(2)(a), and (c) the dwelling is made so available for purposes that are solely or mainly purposes of the trade mentioned in paragraph (a) of this sub-paragraph. (4) The requirements in sub-paragraph (3) apply only to times in the control period when the purchaser holds— (a) the higher threshold interest, or (b) a chargeable interest that is derived from the higher threshold interest. (5) The requirements in sub-paragraph (3) do not apply in relation to times when, because of a change of circumstances that is unforeseen and beyond the purchaser's control, it is not reasonable to expect those requirements to be met. (6) Sub-paragraph (7) applies if at some time in the control period the dwelling— (a) has not begun to be made available as mentioned in sub-paragraph (3)(b) and (c), or (b) has ceased to be so made available. (7) The requirements in paragraphs (b) and (c) of sub-paragraph (3) are treated as being met if reasonable steps are being taken to ensure that the dwelling will begin to be, or will return to being, available as mentioned in those paragraphs. (5K) (1) This paragraph applies where relief under paragraph 5F (farmhouses) has been allowed in respect of a higher threshold interest forming the whole or part of the subject-matter of a chargeable transaction. (2) The relief is withdrawn if at any time in the period of three years beginning with the effective date of the chargeable transaction (“the control period”) the requirements in sub-paragraph (3) are not met (but see sub-paragraphs (4) and (5)). (3) The requirements are that— (a) the land mentioned in paragraph 5F(2) is occupied for the purposes of a qualifying trade of farming, and (b) the dwelling is occupied for the purposes of that trade by a qualifying farm worker. (4) The requirements in sub-paragraph (3) apply only to times in the control period when the purchaser holds— (a) the higher threshold interest, or (b) a chargeable interest that is derived from the higher threshold interest. (5) The requirements in sub-paragraph (3) do not apply in relation to times when, because of a change of circumstances that is unforeseen and beyond the purchaser's control, it is not reasonable to expect those requirements to be met. (6) Sub-paragraph (7) applies if at some time in the control period a requirement in sub-paragraph (3)— (a) has not begun to be met, or (b) has ceased to be met. (7) The requirement is treated as being met if reasonable steps are being taken to ensure that the requirement begins to be met, or is again met.

• (5) After paragraph 6 insert—

(6A) (1) This paragraph applies where— (a) section 71A (land sold to financial institution and leased to person), section 72 (land in Scotland sold to financial institution and leased to person) or section 73 (land sold to financial institution and re-sold to person) applies, and (b) the major interest in land purchased under the first transaction consists of or includes a higher threshold interest. (2) In this paragraph “the first transaction” means— (a) where section 71A applies, the transaction mentioned in section 71A(1)(a); (b) where section 72 applies, the transaction mentioned in section 72(1)(a); (c) where section 73 applies, the transaction mentioned in section 73(1)(a)(i). (3) The condition in paragraph 3(3) is treated as being met with respect to the first transaction only if that condition is met with respect to the second transaction. (4) If the second transaction would qualify for relief under any of paragraphs 5(1), 5B(1), 5D(1) and 5F(1) (disregarding the exemptions in sections 71A(3), 72(3) and 73(3) and assuming, for this purpose, that the subject-matter of the second transaction is a higher threshold interest), the first transaction is taken to qualify for relief under the same provision (and accordingly paragraph 3 does not apply in relation to the first transaction). (5) The first transaction does not qualify for relief under any of paragraphs 5(1), 5B(1), 5D(1) or 5F(1) except in accordance with sub-paragraph (4). (6) In this paragraph “the second transaction” has the same meaning as in section 71A, 72 or 73 (as the case requires). (6B) (1) This paragraph applies where section 72A (land in Scotland sold to financial institution and person in common) applies and the major interest in land purchased under the transaction mentioned in section 72A(1)(a) (“the first transaction”) consists of or includes a higher threshold interest. (2) In determining whether or not the first transaction meets the condition in paragraph 3(3) it is to be assumed that the financial institution referred to in section 72A(1) is not one of the persons acquiring the major interest in land under that transaction. (3) Paragraphs 5 to 5F have effect in relation to the first transaction as they would have effect if the financial institution were not a purchaser under that transaction. (6C) (1) Where paragraph 6A or 6B (“the modifying paragraph”) applies and the first transaction (within the meaning of that paragraph) is treated under paragraph 2(3) as two separate chargeable transactions, references in the modifying paragraph to the first transaction include those separate transactions. (2) If the subject-matter of the second transaction (within the meaning of paragraph 6A) includes a chargeable interest other than a higher threshold interest, that fact is ignored in determining for the purposes of paragraph 6A— (a) whether that transaction meets the condition in paragraph 3(3), or (b) whether it would qualify for relief under any of paragraphs 5(1), 5B(1), 5D(1) and 5F(1). (6D) (1) This paragraph applies where relief under paragraph 5 (businesses of letting, trading in or redeveloping properties) has been allowed, in accordance with paragraph 6A(4) or 6B(3), with respect to the purchase of a major interest in land. (2) The relief is withdrawn if at any time in the period of three years beginning with the effective date of the first transaction (“the control period”) a relevant requirement is not met. (3) The relevant requirements are that— (a) any relevant interest (see sub-paragraphs (5) and (6)) held by the relevant person is held by that person exclusively for one or more of the purposes mentioned in paragraph 5(1), and (b) (if a relevant interest is held by the relevant person) no non-qualifying individual is permitted to occupy the dwelling. (4) For the purposes of sub-paragraph (3)(a) and (b) it does not matter whether the relevant interest is held by the relevant person— (a) jointly or (in Scotland) in common, or (b) otherwise. (5) In relation to relief allowed in accordance with sub-paragraph 6A(4), “relevant interest” means any of the following— (a) the interest acquired under the second transaction (within the meaning of paragraph 6A); (b) any interest transferred to the relevant person as a result of the exercise of the right mentioned in section 71A(1)(d) or 72(1)(c); (c) any chargeable interest derived from an interest such as is mentioned in paragraph (a) or (b). (6) In relation to relief allowed in accordance with paragraph 6B(3), “relevant interest” means any of the following— (a) the interest purchased under the first transaction (within the meaning of paragraph 6B); (b) any interest transferred to the relevant person as a result of the exercise of the right mentioned in section 72A(1)(c); (c) any chargeable interest derived from an interest such as is mentioned in paragraph (a) or (b). (7) In this paragraph— - “non-qualifying individual” (in relation to the chargeable transaction mentioned in sub-paragraph (1)) has the meaning given by paragraph 5A; - “the relevant person” means the person (other than the financial institution) who entered into the arrangements in question as mentioned in section 71A(1), 72(1), 72A(1) or 73(1). (6E) (1) The requirement in paragraph 6D(3)(a) does not apply in relation to times when, because of a change of circumstances that is unforeseen and beyond the relevant person's control, it is not reasonable to expect the interest in question to be held for the purpose for which the relevant person acquired that person's initial interest. (2) Sub-paragraph (3) applies if the relevant person's initial interest was acquired by the relevant person for a purpose mentioned in paragraph 5(1), but at some time in the control period the activity in question (for instance, exploitation as mentioned in paragraph 5(1)(a))— (a) has not begun in the case of a relevant interest, or (b) has ceased in the case of a relevant interest. (3) For the purposes of paragraph 6D(3)(a) the relevant interest is taken to be held for the purpose in question only if reasonable steps are being taken to ensure that the purpose in question is carried out. (4) In this paragraph— (a) “the control period”, “relevant interest” and “the relevant person” have the same meaning as in paragraph 6D; (b) references to the relevant person's “initial interest” are to the interest mentioned in sub-paragraph (5)(a) or (6)(a) of paragraph 6D (as the case requires). (6F) (1) This paragraph applies where relief under paragraph 5B (trades involving making a dwelling open to the public) has been allowed, in accordance with paragraph 6A(4) or 6B(3), with respect to the purchase of a major interest in land. (2) The relief is withdrawn if at any time in the period of three years beginning with the effective date of the first transaction (“the control period”) the requirement in sub-paragraph (3) is not met. (3) The requirement is that the dwelling is being exploited as a source of income in the course of a qualifying trade. (4) The requirement in sub-paragraph (3) does not apply in relation to times when, because of a change of circumstances that is unforeseen and beyond the relevant person's control, it is not reasonable to expect the interest in question to be exploited as mentioned in that sub-paragraph. (5) Sub-paragraph (6) applies if at some time in the control period that person— (a) has not begun to exploit the interest as a source of income in the course of a relevant trade, or (b) has ceased so to exploit it. (6) The requirement in sub-paragraph (3) is treated as being met if reasonable steps are being taken to ensure that the relevant interest begins to be exploited as mentioned in that sub-paragraph, or that such exploitation of the interest is resumed. (7) In this paragraph— (a) “the relevant person” means the person (other than the financial institution) who enters into the arrangements mentioned in section 71A(1), 72(1), 72A(1) or 73(1); (b) references to a major interest in land include an undivided share in a major interest in land. (6G) (1) This paragraph applies where relief under paragraph 5D (dwellings for occupation by certain employees etc) has been allowed, in accordance with paragraph 6A(4) or 6B(3), with respect to the purchase of a major interest in land. (2) The relief is withdrawn if at any time in the control period when the relevant person holds a relevant interest (whether jointly, or in common, or otherwise) any requirement in sub-paragraph (4) is not met. (3) In sub-paragraph (2) “the control period” means the three years beginning with the effective date of the first transaction. (4) The requirements are that— (a) the relevant person, or a relevant group member, carries on a qualifying trade, (b) the dwelling is made available as mentioned in paragraph 5D(2)(a), and (c) the dwelling is made so available for purposes that are solely or mainly purposes of the trade mentioned in sub-paragraph (a). (5) The requirements in sub-paragraph (4) do not apply in relation to times when, because of a change of circumstances that is unforeseen and beyond the relevant person's control, it is not reasonable to expect those requirements to be met. (6) Sub-paragraph (7) applies if at some time in the control period the relevant interest— (a) has not begun to be made available as mentioned in sub-paragraph (4)(b) and (c), or (b) has ceased to be so made available. (7) The requirements in paragraphs (b) and (c) of sub-paragraph (4) are treated as being met if reasonable steps are being taken to ensure that the dwelling will begin to be, or will return to being, made available as mentioned in those paragraphs. (8) Where the relevant person is a company, “relevant group member” means a company which is a member of the same group of companies as the relevant person for the purposes mentioned in paragraph 1(2) of Schedule 7. (9) In this paragraph— (a) “relevant interest” has the same meaning as in paragraph 6D; (b) “the relevant person” means the person (other than the financial institution) who enters into the arrangements mentioned in section 71A(1), 72(1), 72A(1) or 73(1); (c) references to a major interest in land include an undivided share in a major interest in land. (6H) (1) This paragraph applies where relief under paragraph 5F (farmhouses) has been allowed, in accordance with paragraph 6A(4) or 6B(3), in relation to the purchase of a major interest in land. (2) The relief is withdrawn if at any time in the control period when the relevant person holds a relevant interest (whether jointly, or in common, or otherwise) any requirement in sub-paragraph (4) is not met. (3) In sub-paragraph (2) “the control period” means the three years beginning with the effective date of the first transaction. (4) The requirements are that— (a) the land mentioned in paragraph 5F(2) is occupied for the purposes of a qualifying trade of farming, and (b) the dwelling is occupied for the purposes of that trade by a qualifying farm worker. (5) The requirements in sub-paragraph (4) do not apply in relation to times when, because of a change of circumstances that is unforeseen and beyond the relevant person's control, it is not reasonable to expect those requirements to be met. (6) Sub-paragraph (7) applies if at some time in the control period a requirement in sub-paragraph (4)— (a) has not begun to be met, or (b) has ceased to be met. (7) The requirement is treated as being met if reasonable steps are being taken to ensure that the requirement begins to be met, or is again met. (8) In this paragraph— (a) “the relevant interest” has the same meaning as in paragraph 6D; (b) “the relevant person” means the person (other than the financial institution) who enters into the arrangements mentioned in section 71A(1), 72(1), 72A(1) or 73(1); (c) references to a major interest in land include an undivided share in a major interest in land.

• (6) In paragraph 9 (interpretation), at the appropriate places insert—

“financial institution” has the same meaning as in sections 71A to 73B (see section 73BA);

“property development trade” has the meaning given by paragraph 5(3);

“property rental business” has the meaning given by section 133(4) of the Finance Act 2013;

“property trading business” has the meaning given by paragraph 5(3);

“qualifying farm worker” has the meaning given by paragraph 5F(4);

“qualifying trade” has the meaning given by paragraph 5B(3);

“qualifying trade of farming” has the meaning given by paragraph 5F(5);

.

Minor and consequential amendments

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• (1) Section 81 (further return where relief withdrawn) is amended as follows.

• (2) After subsection (1) insert—

(1A) Where relief is withdrawn to any extent under any of paragraphs 5G to 5K of Schedule 4A (higher rate for certain transactions) the purchaser must deliver a further return before the end of the period of 30 days after the relevant date. (1B) In subsection (1A) “the relevant date” means— (a) in the case of relief under paragraph 5 of Schedule 4A (businesses of letting, trading in or redeveloping properties), the first day in the period mentioned in paragraph 5G(2) on which a requirement under paragraph 5G(3) was not met in the case of the chargeable interest in question; (b) in the case of relief under paragraph 5B of that Schedule (trades involving making a dwelling available to the public), the first day in the period mentioned in paragraph 5H(2) on which a requirement under paragraph 5H(3) was not met in the case of the chargeable interest in question; (c) in the case of relief under paragraph 5C of that Schedule (financial institutions acquiring dwellings in the course of lending), the first day in the period mentioned in paragraph 5I(2) on which a requirement under paragraph 5I(3) was not met in the case of the chargeable interest in question; (d) in the case of relief under paragraph 5D of that Schedule (dwellings for occupation by certain employees etc), the first day in the period mentioned in paragraph 5J(2) on which a requirement under paragraph 5J(3) was not met in the case of the chargeable interest in question; (e) in the case of relief under paragraph 5F of that Schedule (farmhouses), the first day in the period mentioned in paragraph 5K(2) on which a requirement under paragraph 5K(3) was not met in the case of the chargeable interest in question.

• (3) In subsection (2A), for “Tax” substitute “ Where subsection (1) applies any tax ”.

• (4) In subsection (3) for “this section” substitute “ subsection (1) ”.

• (5) After subsection (4) insert—

(5) The provisions of Schedule 10 apply to a return under subsection (1A) as they apply to a return under section 76, but with the adaptation that references to the effective date of the transaction are to be read as references to the relevant date (as defined in subsection (1B)).

4

After section 81 insert—

(81ZA) (1) Where relief given in respect of a transaction entered into under alternative finance arrangements is withdrawn to any extent under any of paragraphs 6D, 6F, 6G or 6H of Schedule 4A (higher rate of tax: alternative finance arrangements)— (a) the relevant person must deliver a return to HMRC before the end of the period of 30 days after the date of the disqualifying event; (b) the return must contain a self-assessment of the additional tax chargeable as a result of the withdrawal of the relief; (c) the tax so chargeable is calculated by reference to the rates in force at the effective date of the transaction in respect of which the relief was allowed. (2) The provisions of Schedule 10 (returns, enquiries, assessments and other matters) apply to a return under this section as they apply to a return under section 76 (general requirement to make land transaction return), but with the following adaptations— (a) references to the effective date of the transaction are to be read as references to the date of the disqualifying event; (b) references to the purchaser are to be read as references to the relevant person so far as that is necessary as a result of subsection (1) of this section or section 85(3) (payment of additional tax by relevant person where relief withdrawn). (3) In this section “the date of the disqualifying event” means the first day in the control period on which a relevant requirement was not met. (4) In subsection (3) “relevant requirement” means— (a) where the relief was given under paragraph 5 of Schedule 4A (businesses of letting, trading in or redeveloping properties), a requirement under paragraph 5G(3) of that Schedule; (b) where the relief was given under paragraph 5B of that Schedule (trades involving making a dwelling available to the public), a requirement under paragraph 5H(3) of that Schedule; (c) where the relief was given under paragraph 5C of that Schedule (financial institutions acquiring dwellings in the course of lending), a requirement under paragraph 5I(3) of that Schedule; (d) where the relief was given under paragraph 5D of that Schedule (dwellings for occupation by certain employees etc), a requirement under paragraph 5J(3) of that Schedule; (e) where the relief was given under paragraph 5F of that Schedule (farmhouses), a requirement under paragraph 5K(3) of that Schedule. (5) In subsection (3) “the control period” has the same meaning as in paragraph 5G, 5H, 5I, 5J or 5K (as the case requires) of Schedule 4A. (6) In this section— - “alternative finance arrangements” means any arrangements such as are mentioned in section 71A, 72, 72A or 73; - “the relevant person” means the person (other than the financial institution) who entered into the arrangements in question.

5

In section 85 (liability for tax), after subsection (2) insert—

(3) Where relief given in respect of a transaction entered into under alternative finance arrangements is withdrawn to any extent under any of paragraphs 6D, 6F, 6G and 6H of Schedule 4A (higher rate: alternative finance arrangements)— (a) subsection (1) does not apply in relation to the additional tax payable as a result of the withdrawal of the relief, and (b) the relevant person is liable to pay that additional tax. (4) In subsection (3) “the relevant person” means the person (other than the financial institution) who entered into the arrangements in question.

6

In section 86 (payment of tax), after subsection (2) insert—

(2A) Tax payable as a result of a withdrawal of relief under any of paragraphs 6D, 6F, 6G and 6H of Schedule 4A (higher rate: alternative finance arrangements) must be paid not later than the filing date for the return relating to the withdrawal (see section 81ZA(1)).

7

In the table in section 122 (index of defined expressions), in second column of the entry for “settlement”, after “paragraph 1(1)” insert “ (except as otherwise expressly provided) ”.

Application of amendments

8

The amendments made by paragraphs 1 to 7 have effect in relation to transactions with an effective date on or after the day on which this Act is passed.

Transactions to which section 29 of the Scotland Act 2012 applies

9

• (1) In relation to transactions in relation to which section 29 of the Scotland Act 2012 (disapplication of UK stamp duty land tax) has effect, FA 2003 as amended by this Schedule has effect subject to the following further amendments.

• (2) In section 81ZA, in subsection (6), in the definition of “alternative finance arrangements”, omit “72, 72A”.

• (3) In Schedule 4A—

• (a) in paragraph 6A—

• (i) in sub-paragraph (1)(a), omit “section 72 (land in Scotland sold to financial institution and leased to person)”,

• (ii) omit sub-paragraph (2)(b),

• (iii) in sub-paragraph (4), omit “, 72(3)”, and

• (iv) in sub-paragraph (6), omit “, 72”,

• (b) omit paragraph 6B,

• (c) in paragraph 6C—

• (i) in sub-paragraph (1), omit “or 6B (“the modifying paragraph”)” and for “in the modifying paragraph” substitute “ in paragraph 6A ”, and

• (ii) accordingly, in the heading omit “and 6B”,

• (d) in paragraph 6D—

• (i) in sub-paragraph (1), omit “or 6B(3)”,

• (ii) in sub-paragraph (3)(a), omit “and (6)”,

• (iii) in sub-paragraph (5)(b), omit “or 72(1)(c)”,

• (iv) omit sub-paragraph (6), and

• (v) in sub-paragraph (7), in the definition of “relevant person”, omit “, 72(1), 72A(1)”,

• (e) in paragraph 6E(4)(b), for “sub-paragraph (5)(a) or (6)(a) of paragraph 6D (as the case requires)” substitute “ paragraph 6D(5)(a) ”,

• (f) in paragraph 6F—

• (i) in sub-paragraph (1), omit “or 6B(3)”, and

• (ii) in sub-paragraph (7)(a), omit “, 72(1), 72A(1)”,

• (g) in paragraph 6G—

• (i) in sub-paragraph (1), omit “or 6B(3)”, and

• (ii) in sub-paragraph (9)(b), omit “72(1), 72A(1)”, and

• (h) in paragraph 6H—

• (i) in sub-paragraph (1), omit “or 6B(3), and

• (ii) in sub-paragraph (8)(b), omit “72(1), 72A(1)”.

SCHEDULE 41

Introduction

1

Part 4 of FA 2003 (stamp duty land tax) is amended as follows.

Leases that continue after a fixed term

2

• (1) In Schedule 17A (further provisions about leases), paragraph 3 (leases that continue after a fixed term) is amended as follows.

• (2) In sub-paragraph (3)—

• (a) after “continuation of the lease” insert “ for a period (or further period) of one year ”, and

• (b) in paragraph (a), for “that term” substitute “ that one year period ”.

• (3) After that sub-paragraph insert—

(3A) But no tax or additional tax is payable in respect of a transaction as a result of the continuation of a lease for a period (or further period) of one year under sub-paragraph (2) if, during that one year period, the tenant under the lease is granted a new lease of the same or substantially the same premises in circumstances where paragraph 9A applies.

• (4) After sub-paragraph (3A) insert—

(3B) Sub-paragraph (2) is subject to paragraph 3A.

• (5) In sub-paragraph (4), for the words from “the day” to the end substitute “ the last day of the one year period for which the lease is continued or (as the case may be) further continued. ”

• (6) After sub-paragraph (5) insert—

(6) Where— (a) a lease would be treated as continuing for a period (or further period) of one year under sub-paragraph (2), but (b) (ignoring that sub-paragraph) the lease actually terminates at a time during that period, the lease is to be treated as continuing under sub-paragraph (2) only until that time; and the references in sub-paragraphs (3) and (4) to that one year period are accordingly to be read as references to so much of that year as ends with that time.

3

After that paragraph insert—

(3A) (1) This paragraph applies where— (a) (ignoring this paragraph) paragraph 3 would apply to treat a lease (“the original lease”) as if it were a lease for a fixed term one year longer than the original term, (b) during that one year period the tenant under that lease is granted a new lease of the same or substantially the same premises, (c) the term of the new lease begins during that one year period, and (d) paragraph 9A (backdated lease granted to tenant holding over) does not apply. (2) Paragraph 3 does not apply to treat the lease as continuing after the original term. (3) The term of the new lease is treated for the purposes of this Part as beginning immediately after the original term. (4) Any rent which, in the absence of this paragraph, would be payable under the original lease in respect of that one year period is to be treated as payable under the new lease (and paragraph 1A of Schedule 5 does not apply to it). (5) Where the fixed term of a lease has previously been extended (on one or more occasions) under paragraph 3, this paragraph applies as if references to the original term were references to the fixed term as previously so extended.

4

In section 87 (interest on unpaid tax), in subsection (3)—

• (a) after paragraph (aa) insert—

(aaa) in the case of an amount payable under paragraph 3(3) of Schedule 17A (leases that continue after a fixed term) by reason of the continuation of a lease for a period (or further period) under paragraph 3(2) or (6) of that Schedule, the final day of the period (or further period),

and

• (b) in paragraph (ab) omit “3(3) or” and “leases that continue after a fixed term and”.

5

In section 119 (meaning of “effective date” of a transaction), in subsection (2), at the appropriate place in the list insert— “ paragraph 3(4) of Schedule 17A (leases that continue after a fixed term), ”.

Agreement for lease and assignment of agreement for lease

6

• (1) Schedule 17A is amended as follows.

• (2) In paragraph 12A (agreement for lease), for sub-paragraph (3) substitute—

(3) Where a lease (“the actual lease”) is subsequently granted in pursuance of the agreement, the notional lease is to be treated for the purposes of this Part as if it were a lease granted— (a) on the date the agreement was substantially performed, (b) for a term which begins with that date and ends at the end of the term of the actual lease, and (c) in consideration of the total rent payable over that term and any other consideration given for the notional lease or the actual lease. (3A) Where sub-paragraph (3) applies the grant of the actual lease is disregarded for the purposes of this Part except section 81A (return or further return in consequence of later linked transaction). (3B) For the purposes of section 81A— (a) the grant of the notional lease and the grant of the actual lease are linked (whether or not they would be linked by virtue of section 108), (b) the lessee under the actual lease (rather than the lessee under the notional lease) is liable for any tax or additional tax payable in respect of the notional lease as a result of sub-paragraph (3), and (c) the reference in section 81A(1)(a) to “the purchaser under the earlier transaction” is to be read, in relation to the notional lease, as a reference to the lessee under the actual lease.

• (3) In paragraph 19 (missives of let)—

• (a) for sub-paragraph (2) substitute—

(2) Where in Scotland there is a lease constituted by concluded missives of let (“the first lease”) and at some later time a lease is executed (“the second lease”), the first lease is to be treated for the purposes of this Part as if it were a lease granted— (a) on the date the missives of let were concluded, (b) for a period which begins with that date and ends at the end of the period of the second lease, and (c) in consideration of the total rent payable over that period and any other consideration given for the first lease or the second lease. (2A) Where sub-paragraph (2) applies the grant of the second lease is disregarded for the purposes of this Part except section 81A (return or further return in consequence of later linked transaction). (2B) For the purposes of section 81A— (a) the grant of the first lease and the grant of the second lease are linked (whether or not they would be linked by virtue of section 108), (b) the lessee under the second lease (rather than the lessee under the first lease) is liable for any tax or additional tax payable in respect of the first lease lease as a result of sub-paragraph (2), and (c) the reference in section 81A(1)(a) to “the purchaser under the earlier transaction” is to be read, in relation to the first lease, as a reference to the lessee under the second lease.

,

• (b) for sub-paragraph (4) substitute—

(4) Where sub-paragraph (3) applies and at some later time a lease (“the actual lease”) is executed, this Part applies as if the notional lease were a lease granted— (a) on the date the agreement was substantially performed, (b) for a period which begins with that date and ends at the end of the period of the actual lease, and (c) in consideration of the total rent payable over that period and any other consideration given for the agreement or the actual lease. (4A) Where sub-paragraph (4) applies the grant of the second lease is disregarded for the purposes of this Part except section 81A (return or further return in consequence of later linked transaction).” (4B) For the purposes of section 81A— (a) the grant of the notional lease and the grant of the actual lease are linked (whether or not they would be linked by virtue of section 108), (b) the lessee under the actual lease (rather than the lessee under the notional lease) is liable for any tax or additional tax payable in respect of the notional lease as a result of sub-paragraph (4), and (c) the reference in section 81A(1)(a) to “the purchaser under the earlier transaction” is to be read, in relation to the notional lease, as a reference to the lessee under the actual lease.

• (4) Accordingly, in Schedule 25 to FA 2006, paragraphs 4 and 5 are omitted.

Abnormal rent increases

7

• (1) In Schedule 17A, omit paragraphs 14 and 15 (abnormal increases in rent after fifth year).

• (2) Accordingly, the following are also repealed—

• (a) in Schedule 25 to FA 2006, paragraphs 7, 8 and 9(5), and

• (b) in Schedule 3 to the Scotland Act 2012, paragraph 27(9).

Commencement

8

• (1) The amendments made by paragraph 2(2), (3), (5) and (6) have effect in relation to any one year period for which a lease is continued, or further continued, which begins on or after the commencement day (including any period which would be one year but for paragraph 3(6) of Schedule 17A to FA 2003).

• (2) The amendments made by paragraphs 2(4), 3 and 5 have effect if the one year period mentioned in paragraph 3A(1)(b) of Schedule 17A to FA 2003 begins on or after the commencement day.

• (3) The amendments made by paragraph 4 have effect in relation to amounts payable in consequence of any period for which a lease is continued, or further continued, which begins on or after the commencement day.

• (4) The amendments made by paragraph 6 have effect if the effective date of the actual lease or, as the case may be, second lease falls on or after the commencement day.

• (5) The amendments made by paragraph 7 have effect in relation to any increase in rent that takes effect on or after the commencement day.

• (6) “The commencement day” means the day on which this Act is passed.

SCHEDULE 42

PART 1 — Earlier provision not to have effect

1

• (1) On and after 26 March 2013, Schedule 6 to FA 2000 (climate change levy) has effect as if neither—

• (a) Schedule 20 to FA 2011, nor

• (b) Parts 1 and 2 of Schedule 32 to FA 2012,

had ever been enacted.

• (2) Accordingly—

• (a) in FA 2011, section 78 and Schedule 20 are omitted, and

• (b) in FA 2012, Parts 1 and 2 of Schedule 32 are omitted.

• (3) The amendments made by sub-paragraph (2) are treated as having come into force on 26 March 2013.

PART 2 — New provision having effect from 1 April 2013

New provision

2

Schedule 6 to FA 2000 (climate change levy) is amended as follows.

3

In paragraph 4 (definition of “taxable supply”) in sub-paragraph (2)(b) after “24” insert “ , 24A, 24B, 24C, 42D ”.

4

In paragraph 5 (supplies of electricity) after sub-paragraph (2) insert—

(2A) Levy is chargeable on a supply of electricity if— (a) the supply is made by an exempt unlicensed electricity supplier who is an auto-generator or who is of a description prescribed by regulations made by the Treasury, (b) the electricity was produced in a generating station owned by the supplier using commodities which were the subject of a deemed supply under paragraph 24A or which would have been the subject of such a supply had the reference in paragraph 24A(1)(a) to Great Britain been a reference to the United Kingdom instead, (c) the supply is not a deemed supply under paragraph 23(3), and (d) the person to whom the supply is made is not an electricity utility.

5

In paragraph 6 (supplies of gas) in sub-paragraph (2A) after “24” insert “ , 24A, 24B, 24C, 42D ”.

6

• (1) Paragraph 14 (exemption for supplies to electricity producers) is amended as follows.

• (2) In sub-paragraphs (2)(b) and (3)(b) after “electricity” insert “ in a small generating station ”.

• (3) After sub-paragraph (3) insert—

(3ZA) Sub-paragraph (1) does not exempt a supply where the person to whom the supply is made— (a) uses the commodity supplied in producing electricity in a stand-by generator, and (b) uses the electricity produced otherwise than in exemption-retaining ways.

• (4) After sub-paragraph (3A) insert—

(3B) Paragraph 24A makes provision under which carbon price support rate commodities intended to be used in a generating station may be the subject of a deemed taxable supply (and, accordingly, this paragraph needs to be read subject to that paragraph).

• (5) Omit sub-paragraphs (4) and (5).

7

In paragraph 15 (exemption for supplies to combined heat and power stations) after sub-paragraph (4) insert—

(4A) Paragraph 24B makes provision under which carbon price support rate commodities intended to be used in a combined heat and power station may be the subject of a deemed taxable supply (and, accordingly, this paragraph needs to be read subject to that paragraph).

8

• (1) Paragraph 17 (exemption: self-supplies by electricity producers) is amended as follows.

• (2) After sub-paragraph (1) insert—

(1A) The supply is exempt from levy if it is a supply of electricity produced in— (a) a fully exempt combined heat and power station, (b) a partly exempt combined heat and power station, (c) a stand-by generator, or (d) a small generating station. (1B) Sub-paragraph (1A)(d) applies only if the producer is— (a) an auto-generator, or (b) an exempt unlicensed electricity supplier of a description prescribed by regulations made by the Treasury.

• (3) In sub-paragraph (2) for the words from “If” to “unless—” substitute “ This paragraph does not exempt the supply if— ”.

• (4) Omit sub-paragraphs (3) and (4).

9

In paragraph 21 (regulations to avoid double charges to levy) after sub-paragraph (2) insert—

(2A) In sub-paragraph (2)(b) “taxable supply” does not include a deemed supply under paragraph 24A, 24B, 24C or 42D.

10

In Part 2 after paragraph 24 insert—

(24A) (1) Sub-paragraph (2) applies if— (a) a quantity of a carbon price support rate commodity is brought onto, or arrives at, a site in Great Britain at which a generating station is situated, (b) that quantity of the commodity is intended to be used for producing electricity in the station, (c) the station is neither a fully exempt combined heat and power station nor a partly exempt combined heat and power station, and (d) the station is neither a small generating station nor a stand-by generator. (2) For the purposes of this Schedule the owner of the station is deemed to make a taxable supply to himself of that quantity of the commodity. (3) In sub-paragraph (1)(a) the reference to a commodity being brought onto, or arriving at, a site covers (in particular) gas in a gaseous state arriving at the site through a pipe. (4) For the purposes of sub-paragraph (1) it does not matter— (a) if the quantity of the commodity is not the subject of an actual supply made to the owner of the station, or (b) if the commodity's availability for use in the station is subject to any condition. (24B) (1) Sub-paragraph (2) applies if— (a) a quantity of a carbon price support rate commodity is brought onto, or arrives at, the CHPQA site of a fully exempt combined heat and power station or a partly exempt combined heat and power station in Great Britain, (b) that quantity of the commodity is intended to be used in the station for producing outputs of the station, and (c) the station is not a small generating station. (2) For the purposes of this Schedule the operator of the station is deemed to make a taxable supply to himself of that quantity of the commodity so far as that quantity is referable to the production of electricity. (3) For the purposes of sub-paragraph (2) the extent to which a quantity of a commodity is referable to the production of electricity is to be determined in accordance with regulations under paragraph 24D(1). (4) In sub-paragraph (1)(a) the reference to a commodity being brought onto, or arriving at, the CHPQA site of a station covers (in particular) gas in a gaseous state arriving at the CHPQA site through a pipe. (5) In sub-paragraph (1)(b) “outputs” has the meaning given by paragraph 148(9). (6) For the purposes of sub-paragraph (1) it does not matter— (a) if the quantity of the commodity is not the subject of an actual supply made to the operator of the station, or (b) if the commodity's availability for use in the station is subject to any condition. (7) In this paragraph “CHPQA site”, in relation to a fully exempt combined heat and power station or a partly exempt combined heat and power station, means the site of the scheme in relation to which the station's CHPQA certificate was issued. (24C) (1) This paragraph applies if— (a) a determination (“the initial determination”) is made under regulations falling within paragraph 24B(3) that— (i) none of a quantity of a carbon price support rate commodity is, or (ii) a proportion of such a quantity is not, referable to the production of electricity, (b) as a result of the initial determination, the quantity or proportion of a quantity is determined not to be the subject of a deemed supply under paragraph 24B, and (c) it is later determined that, contrary to the initial determination, the quantity or proportion of a quantity— (i) was referable to the production of electricity, and (ii) accordingly, should have been determined to be the subject of a deemed supply under paragraph 24B. (2) For the purposes of this Schedule— (a) the operator of the station in question is deemed to make a taxable supply to himself of the quantity or proportion of a quantity, and (b) the amount payable by way of levy on the deemed supply is the amount which would have been payable in relation to the quantity or proportion of a quantity had it been determined to be the subject of a deemed supply as mentioned in sub-paragraph (1)(c)(ii). (24D) (1) The Commissioners may by regulations make provision for giving effect to paragraphs 24A to 24C and 42A to 42D. (2) Regulations under sub-paragraph (1) may, in particular, include provision— (a) for determining whether a deemed supply under paragraph 24A or 24B is made; (b) for determining the quantity of any commodity which is the subject of such a deemed supply; (c) for determining whether paragraph 42C(2) applies in relation to a deemed supply under paragraph 24A or 24B and, if it does, the reduction in the relevant carbon price support rate. (3) Regulations under sub-paragraph (1) may include— (a) provision in respect of calculations, measurements, data and procedures to be made or used; (b) provision that, so far as framed by reference to any document, is framed by reference to that document as from time to time in force.

11

After paragraph 38 insert—

(38A) (1) A deemed supply under paragraph 24A or 24B is treated as taking place when the quantity of the commodity is brought onto, or arrives at, the site at which the station is situated or the CHPQA site of the station (as the case may be). (2) A deemed supply under paragraph 24C or 42D is treated as taking place upon the later determination.

12

• (1) Paragraph 39 (regulations as to time of supply) is amended as follows.

• (2) In sub-paragraph (1)(c) after “24” insert “ , 24A, 24B, 24C, 42D ”.

• (3) In sub-paragraph (3) after “supply)” insert “ and 38A ”.

13

In paragraph 42 (amount payable by way of levy) before sub-paragraph (2) insert—

(1B) Sub-paragraph (1) does not apply to a deemed supply under paragraph 24A or 24B.

14

After paragraph 42 insert—

(42A) (1) This paragraph applies to a deemed supply under paragraph 24A or 24B. (2) The amount payable by way of levy on the deemed supply is the amount ascertained by applying the relevant carbon price support rate; and the levy payable on a fraction of a kilowatt hour, kilogram or gigajoule is that fraction of the levy payable on a kilowatt hour, kilogram or gigajoule. (3) The carbon price support rates are as follows.

Carbon price support rate commodity	Carbon price support rate
Any gas in a gaseous state that is of a kind supplied by a gas utility	£0.00091 per kilowatt hour
Any petroleum gas, or other gaseous hydrocarbon, in a liquid state	£0.01460 per kilogram
Any commodity falling within paragraph 3(1)(d) to (f)	£0.44264 per gigajoule

(4) Sub-paragraph (2) needs to be read with paragraphs 42B and 42C. (42B) (1) This paragraph applies for the purposes of paragraph 42A(2) if the commodity deemed to be supplied is a quantity of a commodity falling within paragraph 3(1)(d) to (f). (2) The number of gigajoules in the quantity supplied is to be determined by reference to the total gross calorific value of that quantity. (3) Sub-paragraph (4) applies if there is included in that quantity any coal slurry taken from a slurry pit situated at the site of a coal mine (including a disused coal mine). (4) The gross calorific value of the coal slurry is to be left out of account in determining the total gross calorific value of that quantity. (42C) (1) Sub-paragraph (2) applies for the purposes of paragraph 42A(2) if, in the calendar year in which the deemed supply is treated as taking place, carbon capture and storage technology is operated in relation to carbon dioxide generated by the station in question in producing electricity. (2) In relation to the deemed supply, only C% of the relevant carbon price support rate is to be applied (instead of the full rate). (3) “C%” is 100% minus the station's carbon capture percentage for the calendar year. (4) The station's “carbon capture percentage” for the calendar year is the percentage of the station's generated carbon dioxide for that year which, through the operation of the carbon capture and storage technology, is— (a) captured, and (b) then disposed of by way of permanent storage. (5) The station's “generated carbon dioxide” for the calendar year is the amount of carbon dioxide generated in the year by the station from the use of carbon price support rate commodities in producing electricity. (6) In this paragraph “carbon capture and storage technology” and “carbon dioxide” have the meaning given by section 7(3) and (4) of the Energy Act 2010. (7) Sub-paragraph (8) applies for the purposes of sub-paragraph (4) in relation to any carbon dioxide if— (a) the carbon dioxide is captured but then leaks out and therefore is not disposed of by way of permanent storage, but (b) the leak does not occur— (i) on the land on which the station is situated, (ii) on any other land under the control of the station's owner or a person connected with the station's owner, or (iii) from any pipeline or other facility or installation which is operated by the station's owner or a person connected with the station's owner. Section 1122 of the Corporation Tax Act 2010 (“connected” persons) applies for the purposes of paragraph (b). (8) The carbon dioxide is to be treated as if it had been disposed of by way of permanent storage. (9) If the percentage mentioned in sub-paragraph (4) is not a whole number, it is to be rounded to the nearest whole number (taking 0.5% as nearest to the next whole number). (42D) (1) This paragraph applies if— (a) an amount is determined to be payable by way of levy on a deemed supply of a quantity of a commodity under paragraph 24A or 24B, but (b) it is later determined that that amount is too low. (2) For the purposes of this Schedule— (a) the person who made the deemed supply is deemed to make a further taxable supply to himself of the quantity of the commodity, and (b) the amount payable by way of levy on that further deemed supply is— (i) the total amount payable on the first deemed supply on the basis of the later determination mentioned in sub-paragraph (1)(b), less (ii) the amount previously determined to be payable on the first deemed supply.

15

In paragraph 55 (notification of registrability) in sub-paragraph (1) after paragraph (a) insert—

(aa) expects to be deemed to make a taxable supply to himself under paragraph 24A or 24B, or

.

16

In paragraph 62 (tax credits) in sub-paragraph (1) after paragraph (b) insert—

(ba) a quantity of a carbon price support rate commodity is the subject of a deemed supply under paragraph 24A or 24B but afterwards the quantity— (i) is not used as mentioned in paragraph 24A(1)(b) or 24B(1)(b) (as the case may be), and (ii) is removed from the site at which the station is situated or from the CHPQA site of the station (as the case may be); (bb) after— (i) a determination is made under regulations falling within paragraph 24B(3) that a quantity, or a proportion of a quantity, of a carbon price support rate commodity is referable to the production of electricity, and (ii) it is accordingly determined that the quantity or proportion of a quantity is the subject of a deemed supply under paragraph 24B, it is determined that the quantity or proportion of a quantity was not referable to the production of electricity; (bc) after an amount is determined to be payable by way of levy on a deemed supply under paragraph 24A or 24B, it is determined that that amount is too high;

.

17

In paragraph 146 (regulations) in sub-paragraph (3)—

• (a) for “14(3),” substitute “ 5(2A), 14(2), ”, and

• (b) after “16,” insert “ 17(1B), ”.

18

In paragraph 147 (definitions)—

• (a) at the appropriate places, insert—

“carbon price support rate commodity” means any taxable commodity other than electricity;

,

“CHPQA certificate” has the same meaning as in the Climate Change Levy (Combined Heat and Power Stations) Exemption Certificate Regulations 2001 (S.I. 2001/486);

,

“exempt unlicensed electricity supplier” has the meaning given by paragraph 152A;

,

“Great Britain” includes the territorial waters of the United Kingdom so far as adjacent to Great Britain;

,

“small generating station” has the meaning given by paragraph 152B;

, and

“stand-by generator” means a generating station which— (a) is used to provide an emergency electricity supply to a building in the event of a failure of the building's usual electricity supply, and (b) is not used for any other purpose;

, and

• (b) in the definition of “prescribed”—

• (i) for “14(3),” substitute “ 5(2A), 14(2), ”, and

• (ii) after “16(3)” insert “ , 17(1B) ”.

19

After paragraph 152 insert—

(152A) (1) In this Schedule “exempt unlicensed electricity supplier” means a person— (a) to whom an exemption from section 4(1)(c) of the Electricity Act 1989 (persons supplying electricity to premises) has been granted by an order under section 5 of that Act, or (b) to whom an exemption from Article 8(1)(c) of the Electricity Supply (Northern Ireland) Order 1992 has been granted by an order under Article 9 of that Order, except where the person is acting otherwise than for purposes connected with the carrying on of activities authorised by the exemption. (2) Sub-paragraph (1) applies subject to— (a) any direction under paragraph 151(1), and (b) any regulations under paragraph 151(2). (152B) (1) In this Schedule “small generating station” means a generating station the capacity of which for producing electricity is no more than 2 megawatts. (2) Sub-paragraph (3) applies if a relevant station (“station X”) is one of a number of relevant stations which— (a) are situated in the United Kingdom, and (b) are owned by P or persons connected with P. (3) In applying sub-paragraph (1) in relation to station X, the reference to the capacity of a generating station is to be read as a reference to the capacity of station X and all the other relevant stations mentioned in sub-paragraph (2) taken together. (4) In sub-paragraphs (2) and (3) “relevant station” means a generating station which is neither an exempt CHP station nor a stand-by generator. (5) For the purposes of sub-paragraph (2)(b)— (a) “P” is the person who owns station X, and (b) section 1122 of the Corporation Tax Act 2010 (“connected” persons) applies. (6) Sub-paragraph (7) applies if the scheme in relation to which the CHPQA certificate of an exempt CHP station (“station Y”) is issued covers other exempt CHP stations as well. (7) In applying sub-paragraph (1) in relation to station Y, the reference to the capacity of a generating station is to be read as a reference to the capacity of station Y and all the other exempt CHP stations mentioned in sub-paragraph (6) taken together. (8) In this paragraph “exempt CHP station” means a fully exempt combined heat and power station or a partly exempt combined heat and power station.

20

• (1) Regulation 5 of the Climate Change Levy (Electricity and Gas) Regulations 2001 (S.I. 2001/1136) is amended as follows.

• (2) In paragraph (1) for “paragraph 14(2) of the Act (exemption: certain supplies to electricity producers)” substitute “ paragraphs 5(2A), 14(2) and 17(1B) of the Act (which contain references to exempt unlicensed electricity suppliers) ”.

• (3) In paragraph (2)(a) for “14(4)” substitute “ 152A(1) ”.

• (4) The amendments made by this paragraph are to be treated as having been made by the Treasury under the powers to make regulations conferred by paragraphs 5(2A), 14(2) and 17(1B) of Schedule 6 to FA 2000.

Commencement

21

The amendments made by this Part of this Schedule are treated as having come into force on 26 March 2013.

22

• (1) The amendments made by paragraph 6(2) and (3) above have effect for the purpose of determining if a supply of gas or electricity is exempt from levy where the gas or electricity is actually supplied on or after 1 April 2013.“Gas” means gas in a gaseous state that is of a kind supplied by a gas utility.

• (2) Those amendments are to have effect for the purpose of determining if any other supply is exempt from levy where the supply is treated as taking place on or after 1 April 2013.

• (3) The amendments made by paragraph 8 above have effect for the purpose of determining if a supply of electricity is exempt from levy where the electricity is caused to be consumed on or after 1 April 2013.

• (4) The amendment made by paragraph 10 above has effect in relation to carbon price support rate commodities which are brought onto, or arrive at, sites on or after 1 April 2013.

PART 3 — Carbon price support rates from 1 April 2014

23

• (1) In paragraph 42A of Schedule 6 to FA 2000 (as inserted by paragraph 14 above) for sub-paragraph (3) substitute—

(3) The carbon price support rates are as follows.

Carbon price support rate commodity	Carbon price support rate
Any gas in a gaseous state that is of a kind supplied by a gas utility	£0.00175 per kilowatt hour
Any petroleum gas, or other gaseous hydrocarbon, in a liquid state	£0.02822 per kilogram
Any commodity falling within paragraph 3(1)(d) to (f)	£0.85489 per gigajoule

• (2) The amendment made by this paragraph has effect in relation to supplies treated as taking place on or after 1 April 2014 but before 1 April 2015.

PART 4 — Carbon price support rates from 1 April 2015

24

• (1) In paragraph 42A of Schedule 6 to FA 2000 (as inserted by paragraph 14 above) for sub-paragraph (3) substitute—

(3) The carbon price support rates are as follows.

Carbon price support rate commodity	Carbon price support rate
Any gas in a gaseous state that is of a kind supplied by a gas utility	£0.00334 per kilowatt hour
Any petroleum gas, or other gaseous hydrocarbon, in a liquid state	£0.05307 per kilogram
Any commodity falling within paragraph 3(1)(d) to (f)	£1.62534 per gigajoule

• (2) The amendment made by this paragraph has effect in relation to supplies treated as taking place on or after 1 April 2015.

SCHEDULE 43

The GAAR Advisory Panel

1

• (1) In this Part “the GAAR Advisory Panel” means the panel of persons established by the Commissioners for the purposes of the general anti-abuse rule.

• (2) In this Schedule “the Chair” means any member of the GAAR Advisory Panel appointed by the Commissioners to chair it.

Meaning of “designated HMRC officer”

2

In this Schedule a “designated HMRC officer” means an officer of Revenue and Customs who has been designated by the Commissioners for the purposes of the general anti-abuse rule.

Notice to taxpayer of proposed counteraction of tax advantage

3

• (1) If a designated HMRC officer considers—

• (a) that a tax advantage has arisen to a person (“the taxpayer”) from tax arrangements that are abusive, and

• (b) that the advantage ought to be counteracted under section 209,

the officer must give the taxpayer a written notice to that effect.

• (2) The notice must—

• (a) specify the arrangements and the tax advantage,

• (b) explain why the officer considers that a tax advantage has arisen to the taxpayer from tax arrangements that are abusive,

• (c) set out the counteraction that the officer considers ought to be taken,

• (d) inform the taxpayer of the period under paragraph 4 for making representations, and

• (e) explain the effect of—

• (i) paragraphs 5 and 6, and

• (ii) sections 209(8) and (9) and 212A.

• (3) The notice may set out steps that the taxpayer may take to avoid the proposed counteraction.

4

• (1) If a notice is given to the taxpayer under paragraph 3, the taxpayer has 45 days beginning with the day on which the notice is given to send written representations in response to the notice to the designated HMRC officer.

• (2) The designated officer may, on a written request made by the taxpayer, extend the period during which representations may be made.

Referral to GAAR Advisory Panel

5

If no representations are made in accordance with paragraph 4, a designated HMRC officer must refer the matter to the GAAR Advisory Panel.

6

• (1) If representations are made in accordance with paragraph 4, a designated HMRC officer must consider them.

• (2) If, after considering them, the designated HMRC officer considers that the tax advantage ought to be counteracted under section 209, the officer must refer the matter to the GAAR Advisory Panel.

• (3) The officer must, as soon as reasonably practicable after deciding whether or not the matter is to be referred to the GAAR Advisory Panel, give the taxpayer written notice of the decision.

7

If the matter is referred to the GAAR Advisory Panel, the designated HMRC officer must at the same time provide it with—

• (a) a copy of the notice given to the taxpayer under paragraph 3,

• (b) a copy of any representations made in accordance with paragraph 4 and any comments that the officer has on those representations, and

• (c) a copy of the notice given to the taxpayer under paragraph 8.

8

If the matter is referred to the GAAR Advisory Panel, the designated HMRC officer must at the same time give the taxpayer a notice which—

• (a) specifies that the matter is being referred,

• (b) is accompanied by a copy of any comments provided to the GAAR Advisory Panel under paragraph 7(b), and

• (c) informs the taxpayer of the period under paragraph 9 for making representations, and of the requirement under that paragraph to send any representations to the officer.

9

• (1) The taxpayer has 21 days beginning with the day on which a notice is given under paragraph 8 to send the GAAR Advisory Panel written representations about—

• (a) the notice given to the taxpayer under paragraph 3, or

• (b) any comments provided under paragraph 7(b).

• (2) The GAAR Advisory Panel may, on a written request made by the taxpayer, extend the period during which representations may be made.

• (3) The taxpayer must send a copy of any representations to the designated HMRC officer at the same time as the representations are sent to the GAAR Advisory Panel.

• (4) If no representations were made in accordance with paragraph 4, the designated HMRC officer—

• (a) may provide the GAAR Advisory Panel with comments on any representations made under this paragraph, and

• (b) if comments are provided, must at the same time send a copy of them to the taxpayer.

Decision of GAAR Advisory Panel and opinion notices

10

• (1) If the matter is referred to the GAAR Advisory Panel, the Chair must arrange for a sub-panel consisting of 3 members of the GAAR Advisory Panel (one of whom may be the Chair) to consider it.

• (2) The sub-panel may invite the taxpayer or the designated HMRC officer (or both) to supply the sub-panel with further information within a period specified in the invitation.

• (3) Invitations must explain the effect of sub-paragraph (4) or (5) (as appropriate).

• (4) If the taxpayer supplies information to the sub-panel under this paragraph, the taxpayer must at the same time send a copy of the information to the designated HMRC officer.

• (5) If the designated HMRC officer supplies information to the sub-panel under this paragraph, the officer must at the same time send a copy of the information to the taxpayer.

11

• (1) Where the matter is referred to the GAAR Advisory Panel, the sub-panel must produce—

• (a) one opinion notice stating the joint opinion of all the members of the sub-panel, or

• (b) two or three opinion notices which taken together state the opinions of all the members.

• (2) The sub-panel must give a copy of the opinion notice or notices to—

• (a) the designated HMRC officer, and

• (b) the taxpayer.

• (3) An opinion notice is a notice which states that in the opinion of the members of the sub-panel, or one or more of those members—

• (a) the entering into and carrying out of the tax arrangements is a reasonable course of action in relation to the relevant tax provisions—

• (i) having regard to all the circumstances (including the matters mentioned in subsections (2)(a) to (c) and (3) of section 207), and

• (ii) taking account of subsections (4) to (6) of that section, or

• (b) the entering into or carrying out of the tax arrangements is not a reasonable course of action in relation to the relevant tax provisions having regard to those circumstances and taking account of those subsections, or

• (c) it is not possible, on the information available, to reach a view on that matter,

and the reasons for that opinion.

• (4) For the purposes of the giving of an opinion under this paragraph, the arrangements are to be assumed to be tax arrangements.

• (5) In this Part, a reference to any opinion of the GAAR Advisory Panel about any tax arrangements is a reference to the contents of any opinion notice about the arrangements.

Notice of final decision after considering opinion of GAAR Advisory Panel

12

• (1) A designated HMRC officer who has received a notice or notices under paragraph 11 must, having considered any opinion of the GAAR Advisory Panel about the tax arrangements, give the taxpayer a written notice setting out whether the tax advantage arising from the arrangements is to be counteracted under the general anti-abuse rule.

• (2) If the notice states that a tax advantage is to be counteracted, it must also set out—

• (a) the adjustments required to give effect to the counteraction, and

• (b) if relevant, any steps that the taxpayer is required to take to give effect to it.

Notices may be given on assumption that tax advantage does arise

13

• (1) A designated HMRC officer may give a notice, or do anything else, under this Schedule where the officer considers that a tax advantage might have arisen ....

• (2) Accordingly, any notice given by a designated HMRC officer under this Schedule may be expressed to be given on the assumption that the tax advantage does arise (without agreeing that it does).

SCHEDULE 44

Inheritance Tax Act 1984

1

IHTA 1984 is amended as follows.

2

• (1) Section 71A (trusts for bereaved minors) is amended as follows.

• (2) For subsection (3)(c)(ii) substitute—

(ii) if any of the income arising from any of the settled property is applied for the benefit of a beneficiary, it is applied for the benefit of the bereaved minor.

• (3) In subsection (4), before paragraph (a) insert—

(za) the trustees' having powers that enable them to apply otherwise than for the benefit of the bereaved minor amounts (whether consisting of income or capital, or both) not exceeding the annual limit,

.

• (4) After subsection (4) insert—

(4A) For the purposes of this section and section 71B, the “annual limit” is whichever is the lower of the following amounts— (a) £3,000, and (b) 3% of the amount that is the maximum value of the settled property during the period in question. (4B) For those purposes the annual limit applies in relation to each period of 12 months that begins on 6 April. (4C) The Treasury may by order made by statutory instrument— (a) specify circumstances in which subsection (4)(za) is, or is not, to apply in relation to a trust, and (b) amend the definition of “the annual limit” in subsection (4A). (4D) An order under subsection (4C) may— (a) make different provision for different cases, and (b) contain transitional and saving provision. (4E) A statutory instrument containing an order under subsection (4C) may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, the House of Commons.

3

• (1) Section 71B (charge to tax on property to which section 71A applies) is amended as follows.

• (2) In subsection (1), after “(2)” insert “ , (2B) ”.

• (3) After subsection (2) insert—

(2A) Subsection (2B) applies in a case in which— (a) an amount is paid or applied otherwise than for the benefit of the bereaved minor, and (b) the exemptions provided by subsection (2) of this section and subsections (3) and (4) of section 70 do not apply. (2B) In such a case, tax is not charged under this section in respect of whichever is the lower of the following amounts— (a) the amount paid or applied, and (b) the annual limit.

4

• (1) Section 71D (age 18-to-25 trusts) is amended as follows.

• (2) For subsection (6)(c)(ii) substitute—

(ii) if any of the income arising from any of the settled property is applied for the benefit of a beneficiary, it is applied for the benefit of B.

• (3) After that subsection insert—

(6A) Where the income arising from the settled property is held on trusts of the kind described in section 33 of the Trustee Act 1925 (protective trusts), paragraphs (b) and (c) of subsection (6) have effect as if for “living and under the age of 25,” there were substituted “under the age of 25 and the income arising from the settled property is held on trust for B,

.

• (4) In subsection (7), before paragraph (a) insert—

(za) the trustees' having powers that enable them to apply otherwise than for the benefit of B amounts (whether consisting of income or capital, or both) not exceeding the annual limit,

.

• (5) After that subsection insert—

(7A) For the purposes of this section and section 71E, the “annual limit” is whichever is the lower of the following amounts— (a) £3,000, and (b) 3% of the amount that is the maximum value of the settled property during the period in question. (7B) For those purposes the annual limit applies in relation to each period of 12 months that begins on 6 April. (7C) The Treasury may by order made by statutory instrument— (a) specify circumstances in which subsection (7)(za) is, or is not, to apply in relation to a trust, and (b) amend the definition of “the annual limit” in subsection (7A). (7D) An order under subsection (7C) may— (a) make different provision for different cases, and (b) contain transitional and saving provision. (7E) A statutory instrument containing an order under subsection (7C) may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, the House of Commons.

5

• (1) Section 71E (charge to tax on property to which section 71D applies) is amended as follows.

• (2) In subsection (1), for “(4)” substitute “ (4A) ”.

• (3) After subsection (4) insert—

(4A) If an amount is paid or applied otherwise than for the benefit of B and the exemptions provided by subsections (2) to (4) do not apply, tax is not charged under this section in respect of whichever is the lower of the following amounts— (a) the amount paid or applied, and (b) the annual limit.

6

• (1) Section 89 (trusts for disabled persons) is amended as follows.

• (2) For subsection (1)(b) substitute—

(b) which secure that, if any of the settled property or income arising from it is applied during the disabled person's life for the benefit of a beneficiary, it is applied for the benefit of the disabled person.

• (3) For subsection (3) substitute—

(3) The trusts on which the settled property is held are not to be treated as falling outside subsection (1) by reason only of— (a) the trustees' having powers that enable them to apply otherwise than for the benefit of the disabled person amounts (whether consisting of income or capital, or both) not exceeding the annual limit, (b) the trustees' having the powers conferred by section 32 of the Trustee Act 1925 (powers of advancement), (c) the trustees' having those powers but free from, or subject to a less restrictive limitation than, the limitation imposed by proviso (a) of subsection (1) of that section, (d) the trustees' having the powers conferred by section 33 of the Trustee Act (Northern Ireland) 1958 (corresponding provision for Northern Ireland), (e) the trustees' having those powers but free from, or subject to a less restrictive limitation than, the limitation imposed by subsection (1)(a) of that section, or (f) the trustees' having powers to the like effect as the powers mentioned in any of paragraphs (b) to (e). (3A) For the purposes of this section, the “annual limit” is whichever is the lower of the following amounts— (a) £3,000, and (b) 3% of the amount that is the maximum value of the settled property during the period in question. (3B) For those purposes the annual limit applies in relation to each period of 12 months that begins on 6 April. (3C) The Treasury may by order made by statutory instrument— (a) specify circumstances in which subsection (3)(a) is, or is not, to apply in relation to a trust, and (b) amend the definition of “the annual limit” in subsection (3A). (3D) An order under subsection (3C) may— (a) make different provision for different cases, and (b) contain transitional and saving provision. (3E) A statutory instrument containing an order under subsection (3C) may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, the House of Commons.

• (4) In subsection (4), for the words following “into settlement,” substitute “ was a disabled person ”.

• (5) For subsections (5) and (6) substitute—

(4A) In this section “disabled person” has the meaning given by Schedule 1A to the Finance Act 2005.

7

• (1) Section 89A (self-settlement by person with condition expected to lead to disability) is amended as follows.

• (2) In subsection (1)(b), for the words following “A becoming” substitute “ a person falling within any paragraph of the definition of “disabled person” in paragraph 1 of Schedule 1A to the Finance Act 2005 ”.

• (3) In subsection (2), after “settled property” insert “ or income arising from it ”.

• (4) For subsections (5) and (6) substitute—

(5) For the purposes of subsection (1)(b), assume— (a) that A will meet any conditions as to residence or presence that are required to establish entitlement to the allowance, payment or increased pension in question, (b) that there will be no provision made by regulations under any of the following— (i) sections 67(1) and (2), 72(8), 104(3) and 113(2) of SSCBA 1992, (ii) sections 67(1) and (2), 72(8), 104(3) and 113(2) of SSCB(NI)A 1992, and (iii) sections 85 and 86 of WRA 2012 and the corresponding provision having effect in Northern Ireland, and (c) that A will not be prevented from receiving the allowance, payment or increased pension in question by any of the following— (i) section 113(1) of SSCBA 1992, (ii) section 113(1) of SSCB(NI)A 1992, (iii) section 87 of WRA 2012 and the corresponding provision having effect in Northern Ireland, (iv) articles 61 and 64 of the Personal Injuries (Civilians) Scheme 1983 (S.I. 1983/686), (v) article 53 of the Naval, Military and Air Forces etc. (Disablement and Death) Service Pensions Order 2006 (S.I. 2006/606), and (vi) article 42 of the Armed Forces and Reserve Forces (Compensation Scheme) Order 2011 (S.I. 2011/517).

• (5) Before subsection (7) insert—