Legalize / United Kingdom / Public General Act

Finance Act 2013

Type Public General Act

Publication 2013-07-17

Last updated 2025-12-16

State In force

Department Statute Law Database

Source legislation.gov.uk

articles Not indexed

Reform history JSON API

(ii) any grant or other financial assistance under section 18 of the Housing Act 1996 (c. 52) (social housing grants);

(iii) any grant or other financial assistance under section 2 of the Housing (Scotland) Act 1988 (c. 43) (general functions of the Scottish Ministers);

(d) “qualifying housing provider” means—

(i) a relevant housing provider (within the meaning of section 71 of FA 2003),

(ii) a body registered as a social landlord in a register maintained under section 1(1) of the Housing Act 1996 (Welsh registered social landlords), or

(iii) a body registered under section 20(1) of the Housing (Scotland) Act 2010 (asp 17) (Scottish registered social landlords).

Exemptions

Charitable companies

151

(1) A charitable company that is entitled to a single-dwelling interest is regarded as not meeting the ownership condition with respect to the interest on any day on which the interest is held by the company for qualifying charitable purposes, other than an excluded day.

(2) The interest is “held for qualifying charitable purposes” if it is held—

(a) for use in furtherance of the charitable purposes of the charitable company or of another charity, or

(b) as an investment from which the profits are (or are to be) applied to the charitable purposes of the charitable company.

(3) A day is an “excluded day” if the following conditions are met—

(a) a person (“the donor”) has on or before that day made, or agreed to make, a gift to the charitable company or to a charity that is connected with it,

(b) there exist on that day arrangements under which or as a result of which a linked individual is permitted, or is to be or may in the future be permitted, to occupy the dwelling, and

(i) the likely effects of the gift and the arrangements, or

(ii) the circumstances in which the gift was made and the circumstances in which the arrangements were entered into,

that the gift would not have been made and the arrangements would not have been entered into independently of one another;

but see the exception in subsection (5).

(4) In subsection (3)(b) “linked individual” means an individual who—

(a) is the donor, or

(b) was, when the arrangements were entered into, an associate of the donor.

(5) A day is not an “excluded day” if the first, second or third condition is met on that day.

The first condition is that the activities undertaken for carrying out the primary purposes of the charitable company include, or normally include, opening the dwelling to the public.

The second condition is that the dwelling is being exploited through commercial activities that involve, or normally involve, opening the dwelling to the public.

The third condition is that steps are being taken—to secure that the first or second condition will be met without undue delay, orto secure that the single-dwelling interest will be sold without undue delay.

(6) In subsection (5)—

(a) “opening the dwelling to the public” means offering the public the opportunity to make use of, stay in or otherwise enjoy, on at least 28 days in any year, areas that constitute a significant part of the interior of the dwelling or of the dwelling's garden or grounds;

(b) “without undue delay” means without delay, except so far as delay is justified by commercial considerations or for the sake of a primary purpose of the charitable company.

(7) For the purposes of subsection (6)(a), the size (relative to the size of the whole dwelling or of the whole garden or grounds), nature, and function of the areas concerned are to be taken into account in determining whether they form a significant part of the interior of the dwelling or (as the case may be) of the garden or grounds.

(8) For the purposes of subsection (3)(a)—

(a) “connected” means connected in a matter relating to the structure, administration or control of the charitable company, and

(b) section 172 does not apply.

Section 151: supplementary

152

(1) In section 151 “associate”, in relation to the donor, means any of the following—

(a) an individual (“a connected person”) who is connected with the donor,

(b) an individual who is the settlor in relation to a settlement of which a trustee is (in the capacity of trustee) connected with the donor,

(d) 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,

(e) a relative of the spouse or civil partner of a connected person or of a relevant settlor, or

(f) the spouse or civil partner of a person falling within paragraph (e).

(2) In subsection (1)—

“relative” means brother, sister, ancestor or lineal descendant;

“settlement” and “settlor” have the same meaning as in Chapter 5 of Part 5 of ITTOIA 2005 (see section 620 of that Act).

(3) In subsection (1)(b) “trustee” is to be read in accordance with section 1123(3) of CTA 2010 (“connected persons”: supplementary).

(4) For the purposes of section 151 occupation of any part of a dwelling is regarded as occupation of the dwelling.

(5) For the purposes of section 151(3)—

(a) the making of a gift is disregarded if it is made before the day on which this Act is passed, and

(b) an agreement to make a gift is disregarded if the agreement is made before that day.

(6) Arrangements entered into before the day on which this Act is passed are disregarded for the purposes of section 151(3) unless a material alteration has been made to them on or after that date.

“Material alteration” means an alteration affecting anything in the arrangements that relates to the individual's having (at any time), or potentially having, permission to occupy the dwelling.

(7) References in section 151 and this section to a gift include the disposal of an asset for consideration of an amount or value which is less than the market value of the asset.

(8) In section 151 and this section “arrangements” includes any scheme, arrangement or understanding of any kind, whether or not legally enforceable, involving a single transaction or two or more transactions.

Public bodies

153

(1) A public body is not regarded as a company for the purposes of this Part.

(2) In this section—

(a) “public body” means any body corporate that is a public body for the purposes of section 66 of FA 2003, and

(b) references to a public body accordingly include a company such as is mentioned in subsection (5) of that section (companies wholly owned by the listed bodies).

(3) The power of the Treasury to prescribe persons by an order under section 66(4) of FA 2003 may be exercised so as to make different provision for purposes relating to annual tax on enveloped dwellings and stamp duty land tax.

(4) In paragraph (b) of subsection (2) “company” means a company as defined by section 1 of the Companies Act 2006 (and subsection (1) is to be ignored in interpreting that paragraph).

Bodies established for national purposes

154

(1) A body listed in subsection (2) is not regarded as a company for the purposes of this Part.

(2) The bodies are—

the Historic Buildings and Monuments Commission for England;

the Trustees of the British Museum;

the Trustees of the National Heritage Memorial Fund;

the Trustees of the Natural History Museum.

Dwelling conditionally exempt from inheritance tax

155

(1) Subsection (2) applies to a single-dwelling interest if—

(a) the whole or part of the dwelling has been designated under section 31 of IHTA 1984 (buildings of outstanding historic or architectural interest etc),

(b) an undertaking has been made with respect to the dwelling under section 30 of that Act (conditionally exempt transfers), and

(2) The taxable value of the single-dwelling interest on any day is taken to be zero if no chargeable event has occurred with respect to the dwelling in the time between the transfer of value and the beginning of that day.

(3) Subsection (4) applies to a single-dwelling interest if—

(a) the whole or part of the dwelling has been designated under section 31 of IHTA 1984,

(b) an undertaking has been made with respect to the dwelling under section 78 of that Act (settled property: conditionally exempt occasions), and

(c) a transfer of property or other event is a conditionally exempt occasion by virtue of that designation and that undertaking.

(4) The taxable value of the single-dwelling interest on any day is taken to be zero if no chargeable event has occurred with respect to the dwelling in the time between the conditionally exempt occasion and the beginning of that day.

(5) In this section—

“chargeable event” means an event which is a chargeable event under section 32 of IHTA 1984;

“conditionally exempt occasion” is to be read in accordance with section 78(2) of that Act;

“transfer of value” has the same meaning as in that Act.

Power to modify reliefs

Modification of reliefs

156

(1) The Treasury may by regulations—

(a) amend this Part for the purpose of providing further relief, or further exemptions, from tax (whether by modifying an existing relief or exemption or otherwise);

(b) amend or repeal any of sections 132 to 155 for purposes not falling within paragraph (a);

(c) make any amendment of any other provision of this Part that may be necessary in consequence of provision under paragraph (b).

(2) In subsection (1)—

(a) the reference to providing further relief from tax includes the provision of relief for additional persons or categories of person or in additional cases or circumstances;

(b) the reference to providing further exemptions from tax includes the provision of exemptions for additional persons or categories of person or in additional cases or circumstances.

Alternative property finance

Land sold to financial institution and leased to person

157

(1) This section applies where—

(a) section 71A of FA 2003 (land sold to financial institution and leased to person) ... applies in relation to arrangements entered into between a financial institution and another person (“the lessee”), and

(b) the land in which the institution purchases a major interest under the first transaction is in England ... or Northern Ireland and consists of or includes one or more dwellings (or parts of a dwelling).

(2) This Part has effect in relation to times when the arrangements are in operation as if—

(a) the interest held by the financial institution as mentioned in subsection (3)(b) were held by the lessee (and not by the financial institution), and

(b) the lease or sub-lease granted under the second transaction had not been granted.

(3) The reference in subsection (2) to times when the arrangements are in operation is to times when—

(a) the lessee holds the leasehold interest granted to it under the second transaction, and

(b) the interest purchased under the first transaction (or that interest except so far as transferred by a further transaction) is held by a financial institution.

(4) A company or individual treated under subsection (2)(a) as holding an interest at a particular time is treated as holding it as a member of a partnership if at the time in question the company or individual holds the leasehold interest as a member of the partnership (and this Part has effect accordingly in relation to the other members of the partnership).

(5) In relation to times when the arrangements operate for the benefit of a collective investment scheme, this Part has effect as if—

(a) the interest held by the financial institution as mentioned in subsection (6)(b) were held by the lessee for the purposes of a collective investment scheme (and were not held by the financial institution), and

(b) the lease or sub-lease granted under the second transaction had not been granted.

(6) The reference in subsection (5) to times when the arrangements operate for the benefit of a collective investment scheme is to times when—

(a) the lessee holds the leasehold interest for the purposes of a collective investment scheme, and

(b) the interest purchased under the first transaction (or that interest except so far as transferred by a further transaction) is held by a financial institution.

(7) In this section—

“financial institution” has the meaning given by section 73BA of FA 2003;

“the first transaction” has the same meaning as in section 71A ... of FA 2003;

“further transaction” has the same meaning as in section 71A of FA 2003;

“the leasehold interest” means the interest granted to the lessee under the second transaction;

“the second transaction” has the same meaning as in section 71A ... of FA 2003.

(8) The reference in subsection (1) to a major interest in land is to be read in accordance with section 117 of FA 2003.

(9) Where the lessee is an individual, references in subsections (2), (3), (5) and (6) to the lessee are to be read, in relation to times after the death of the lessee, as references to the lessee's personal representatives.

(10) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Administration and payment of tax

Responsibility for collection and management

158

The Commissioners for Her Majesty's Revenue and Customs are responsible for the collection and management of annual tax on enveloped dwellings.

Annual tax on enveloped dwellings return

159

(1) Where tax is charged on a person for a chargeable period with respect to a single-dwelling interest the person must deliver a return for the period with respect to the interest.

(2) A return under subsection (1) must be delivered by the end of the period of 30 days beginning with first day in the period on which the person is within the charge with respect to the interest.

(3) If the first day in the chargeable period on which the person is within the charge with respect to the interest (“day 1”) is a valuation date only because of section 124 (new dwellings) or section 125 (dwellings produced from other dwellings)—

(a) subsection (2) does not apply, and

(b) the return must be delivered by the end of the period of 90 days beginning with day 1.

(3A) Where a person—

(a) would (apart from this subsection) be required in accordance with subsection (2) to deliver a return for a chargeable period (“the later period”) by 30 April in that period, and

(b) is also required in accordance with subsection (3) to deliver a return for the previous chargeable period by a date (“the later date”) which is later than 30 April in the later period,

subsection (2) has effect as if it required the return mentioned in paragraph (a) to be delivered by the later date.

(4) A return under this section must be delivered to an officer of Revenue and Customs, and is called an “annual tax on enveloped dwellings return”.

Return of adjusted chargeable amount

160

(1) A person on whom tax is charged for a chargeable period with respect to a single-dwelling interest must deliver a further return for the period with respect to the interest if the first or second condition is met.

(2) The return must be delivered by the end of the period of 30 days beginning with the first day of the period following the period for which the tax is charged (but see subsection (3)).

(3) If the return is required because the second condition is met and the adjusted chargeable amount is affected by an event that has occurred after the end of the chargeable period mentioned in subsection (1), the return must be delivered by the end of the period of 30 days beginning with the day on which that event occurred.

(4) The first condition is that—

(a) the person has not made a claim under section 100 (interim relief) with respect to the interest for the chargeable period, and

(b) the adjusted chargeable amount is greater than the amount charged under section 99 with respect to the single-dwelling interest for the period.

(5) The second condition is that—

(a) the person has made one or more claims under section 100 with respect to the interest for the chargeable period, and

(b) the sum of amounts A and B, as calculated under that section, in connection with the last of those claims is less than the adjusted chargeable amount.

(6) A return under this section must be delivered to an officer of Revenue and Customs, and is called a “return of the adjusted chargeable amount”.

Return to include self assessment

161

(1) A return must include a self assessment.

(2) In subsection (1) “return” means—

(a) an annual tax on enveloped dwellings return, or

(b) a return of the adjusted chargeable amount.

(2A) The reference in subsection (2)(a) to an annual tax on enveloped dwellings return does not include a relief declaration return.

(3) In the case of an annual tax on enveloped dwellings return, “self assessment” means an assessment of—

(a) the amount of tax to which the person is chargeable under section 99 for the period in respect of the interest, and

(b) if the return includes a claim under section 100 (interim relief), the tax payable after the relief.

(4) In the case of a return of the adjusted chargeable amount, “self assessment” means an assessment of—

(a) the adjusted chargeable amount, and

(b) the additional tax payable in accordance with section 163(2).

(5) A self assessment must include a statement of the amount taken to be the market value of the interest on each valuation date (earlier than the date on which the return is delivered) that is relevant for the purposes of the assessment.

Returns, enquiries, assessments and other administrative matters

162

(1) Schedule 33 contains provision about returns, enquiries and related matters.

(2) The Treasury may by regulations—

(a) make any amendments of Schedule 33 that they may at any time think appropriate;

(b) make any amendment of any other provision of this Part that may be necessary in consequence of provision under paragraph (a).

Payment of tax

163

(1) Tax charged on a person under section 99 for a chargeable period with respect to a single-dwelling interest must be paid not later than the filing date for the annual tax on enveloped dwellings return required to be made for the period with respect to the interest.

(2) So far as a chargeable person's adjusted chargeable amount for a chargeable period with respect to a single-dwelling interest exceeds the amount payable under subsection (1) (as modified, where applicable, by section 100(3)), the amount of the difference must be paid not later than the filing date for the return of the adjusted chargeable amount under section 160.

(3) Tax payable as a result of the amendment of a return must be paid—

(a) immediately, or

(b) if the amendment is made on or before the filing date for the return, not later than that date.

(4) In subsection (3) “return” means—

(a) an annual tax on enveloped dwellings return, or

(b) a return of the adjusted chargeable amount.

(5) Tax payable in accordance with a determination or assessment by an officer of Revenue and Customs must be paid within the period of 30 days beginning with the day on which the determination or assessment is issued.

Information and enforcement

164

In Schedule 34—

(a) Part 1 contains provision about information and inspection powers, and

(b) Part 2 contains provision about penalties.

Collection and recovery of tax etc

165

(1) Schedule 12 to FA 2003 (stamp duty land tax: collection and recovery of tax) has effect in relation to the collection and recovery of tax under this Part as it has effect in relation to stamp duty land tax.

(2) The reference in subsection (1) to tax under this Part includes any unpaid penalty or interest under this Part.

Application of provisions

Companies

166

(1) In this Part “company” means a body corporate but does not include—

(a) a corporation sole, or

(b) any partnership (see section 167(1)).

(2) Everything to be done by a company under this Part must be done by the company acting through—

(a) the proper officer of the company, or

(b) another person who has the express, implied or apparent authority of the company to act on its behalf for the purpose.

(3) Service of a document on a company under this Part may be effected by serving the document on the proper officer.

(4) Tax due from any company that is incorporated under the law of a country or territory outside the United Kingdom may be recovered from the proper officer of the company (as well as by any means available in the absence of this subsection).

(5) The proper officer—

(a) may retain, out of any money that may come into the officer's hands on the company's behalf, enough money to pay that tax, and

(b) is entitled to be fully reimbursed by the company (whether by that method or another) for amounts recovered from the officer under subsection (4).

(6) For the purposes of this section the proper officer of a company is—

(a) the secretary, or a person acting as secretary, of the company, or

(b) if the company does not have a proper officer within paragraph (a), the treasurer, or a person acting as treasurer, of the company.

(7) If a liquidator has been appointed for the company—

(a) subsections (2)(b) and (6) do not apply, and

(b) the liquidator is the proper officer of the company.

(8) If an administrator has been appointed for the company—

(a) subsection (6) does not apply, and

(b) the administrator is the proper officer of the company.

(9) If two or more persons are appointed to act jointly or concurrently as the administrator of the company, the proper officer of the company is—

(a) whichever of those persons is specified in a notice given by the administrators to an officer of Revenue and Customs for the purposes of this section, or

(b) if no notice is given under paragraph (a), whichever of those persons is designated by an officer of Revenue and Customs as the proper officer for those purposes.

(10) See also section 153 (public bodies) and section 154 (bodies established for national purposes).

Partnerships

167

(1) In this Part “partnership” means—

(a) a partnership within the Partnerships Act 1890,

(b) a limited partnership registered under the Limited Partnerships Act 1907,

(c) a limited liability partnership formed under the Limited Liability Partnerships Act 2000 or the Limited Liability Partnerships Act (Northern Ireland) 2002, or

(d) a firm or entity of a similar character to any of those mentioned in paragraphs (a) to (c) formed under the law of a country or territory outside the United Kingdom.

(2) This Part has effect as follows in relation to a partnership (for instance, a limited liability partnership formed as mentioned in subsection (1)(c)) that is itself capable of being entitled to, or of acquiring or disposing of, a chargeable interest—

(a) transactions entered into on behalf of the partnership are treated as entered into by or on behalf of the partners;

(b) where the partnership is entitled to a single-dwelling interest, this Part has effect as if the partners were jointly entitled to the interest (and the partnership had no entitlement to it).

(3) For the purposes of this Part a partnership is treated as the same partnership despite a change in membership if any person who was a member before the change remains a member after the change.

(4) For the purposes of this Part—

(a) a collective investment scheme is not regarded as a partnership, and

(b) accordingly, a member of a partnership by or on whose behalf a single-dwelling interest is held for the purposes of a collective investment scheme is not regarded as entitled to the interest as a member of the partnership.

(5) Anything required or authorised by this Part to be done by or in relation to the responsible partners for a partnership may instead be done by or in relation to any representative partner or partners.

(6) A representative partner means a partner nominated by a majority of the partners to act as the representative of the partnership for the purposes of this Part of this Act.

(7) Any such nomination, or the revocation of such a nomination, has effect only after notice of the nomination, or revocation, has been given to an officer of Revenue and Customs.

Supplementary provisions

Miscellaneous amendments and transitory provision

168

Schedule 35 contains—

(a) miscellaneous amendments, and

(b) provision about the chargeable period beginning on 1 April 2013.

Orders and regulations

169

(1) Orders and regulations under this Part are to be made by statutory instrument.

(2) A statutory instrument containing an order or regulations made under this Part is subject to annulment in pursuance of a resolution of the House of Commons.

(3) Subsection (2) does not apply to—

(a) an instrument containing only an order under section 101(5), or

(b) an instrument to which subsection (4) applies.

(4) A statutory instrument containing (whether alone or with other provision) provision made under section 156(1) or 162(2) 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) An order or regulations under this Part—

(a) may make different provision for different purposes,

(b) may include consequential or transitional provisions or savings.

Interpretation

Meaning of “chargeable day” and “within the charge”

170

(1) Any day on which the conditions in section 94(2) are met with respect to a single-dwelling interest is a “chargeable day” for that interest.

(2) Where a day is a chargeable day as a result of subsection (1), the chargeable person is “within the charge” with respect to a single-dwelling interest on that day.

References to the state of affairs “on” a day

171

In determining for the purposes of any provision of this Part whether or not a state of affairs obtains on a particular day, it is to be assumed that the state of affairs obtaining at the end of the day persisted throughout the day.

Connected persons

172

(1) Section 1122 of the Corporation Tax Act 2010 (connected persons) has effect for the purposes of this Part (except where otherwise stated).

(2) For the purposes of this Part a person is taken to be connected with a collective investment scheme if the person is a participant in the scheme who—

(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.

(3) The reference in subsection (2) to a collective investment scheme does not include a unit trust scheme; but see section 1123(2) of CTA 2010 (provision about the application of rules about connected persons to unit trust schemes).

(4) The reference in subsection (2)(a) to profits or income arising from the scheme is to profits or income arising from the acquisition, holding, management or disposal of the property subject to the scheme.

(5) For the purposes of subsection (2) a person is taken to have any rights and powers that the person—

(a) is entitled to acquire at a future date, or

(b) will at a future date be entitled to acquire.

(6) For the purposes of subsection (2) the rights and powers of any associate of a person (or of any two or more associates of a person) are to be attributed to the person.

(7) In this section “associate” has the same meaning as in Part 10 of CTA 2010 (see section 448 of that Act); but for this purpose section 448 is to be read as if the words “or partner” were omitted in subsection (1)(a).

Connected persons: cell companies

173

(1) For the purposes of this Part a person is to be treated as connected to a cell company where, if any cell of the company were a separate company, the person would be connected to that separate company.

(2) For the purposes of this section a company is a “cell company” if it meets the first or second condition.

(3) The first condition is that under the law under which the company is incorporated or formed, under the company's articles of association or other document regulating the company or under arrangements entered into by or in relation to the company—

(a) some or all of the assets of the company are available primarily, or only, to meet particular liabilities of the company, and

(b) some or all of the members of the company, and some or all of its creditors, have rights primarily, or only, in relation to particular assets of the company.

(4) The second condition is that the company's articles of association, or other document regulating it, establish an entity (by whatever name known) which—

(a) under the law under which the company is incorporated or formed, has legal personality distinct from that of the company, and

(b) which is not itself a company.

(5) For the purposes of this section a “cell”, in relation to a cell company, is—

(a) an identifiable part of the company (by whatever name known) that carries on distinct business activities and to which particular assets and liabilities of the company are primarily or wholly attributable, or

(b) an entity of the kind specified in subsection (4).

General interpretation of Part 3

174

(1) In this Part—

“chargeable day” (in relation to a single-dwelling interest) is to be read in accordance with section 170;

“chargeable interest” has the meaning given by section 107;

“the chargeable person” has the meaning given by section 96(2) or (3);

“closure notice” has the meaning given by paragraph 16 of Schedule 33;

“collective investment scheme” has the same meaning as in Part 17 of the Financial Services and Markets Act 2000 (see section 235 of that Act);

“company” has the meaning given by section 166(1);

“completion”, in Scotland, means—in relation to a lease, when it is executed by the parties (that is to say, by signing) or constituted by any means,in relation to any other transaction, the settlement of the transaction;

“discovery assessment” has the meaning given by paragraph 21 of Schedule 33;

“EEAUCITS” has the same meaning as in Part 17 of the Financial Services and Markets Act 2000 (see section 237 of that Act);

“excluded rents” has the meaning given by section 133(6);

“farming” has the meaning given by section 148(4);

“filing date”, in relation to an annual tax on enveloped dwellings return or a return of the adjusted chargeable amount, has the meaning given by paragraph 58 of Schedule 33;

“financial institution” has the meaning given by section 143 (except where otherwise stated);

“HMRC” means Her Majesty's Revenue and Customs;

“HMRC determination” has the meaning given by paragraph 18 of Schedule 33;

“jointly entitled” means—in England and Wales, beneficially entitled as joint tenants or tenants in common,in Scotland, entitled as joint owners or owners in common,in Northern Ireland, beneficially entitled as joint tenants, tenants in common or coparceners;

“land” includes—buildings and structures, andland covered by water;

“market value” has the meaning given by section 98(8);

“notice of enquiry” has the meaning given by paragraph 8 of Schedule 33;

“open-ended investment company” has the same meaning as in Part 17 of the Financial Services and Markets Act 2000 (see section 236(1) of that Act);

“participant”, in relation to a collective investment scheme, has the meaning given by section 98(7);

“partnership” has the meaning given by section 167;

“property development trade” has the meaning given by section 138(4);

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

“property trading business” has the meaning given by section 141(3);

“qualifying property rental business” has the meaning given by section 133(3);

“self assessment” has the meaning given by section 161(3);

“tax” means tax under this Part;

“trade” has the same meaning as in section 35 of CTA 2009 (and cognate expressions are to be read accordingly);

“unit trust scheme” has the same meaning as in Part 17 of the Financial Services and Markets Act 2000 (see section 237(1) of that Act).

(2) In this Part—

references to the “adjusted chargeable amount”, in relation to a person on whom tax is charged for a chargeable period with respect to a single-dwelling interest, are to be read in accordance with section 105;

references to an “annual tax on enveloped dwellings return” are to be read in accordance with section 159(4);

references to the “daily amount” for a day are to be read in accordance with section 105(2);

references to “delivery”, in relation to an annual tax on enveloped dwellings return, are to be read in accordance with paragraph 2 of Schedule 33;

references to the “effective date” of an acquisition are to be read in accordance with section 121(4);

references to the “effective date” of a disposal are to be read in accordance with section 121(5);

references to a “major interest” in land are to be read in accordance with section 117 of FA 2003;

references to the “management company”, in relation to an EEA UCITS, are to be read in accordance with Article 2.1(b) of the Directive 2009/65/EC of the European Parliament and of the Council of 13 July 2009 on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities;

references to a “return of the adjusted chargeable amount” are to be read in accordance with section 160(6);

references to meeting the “ownership condition” are to be read in accordance with section 94(4) to (6);

references to being “within the charge” with respect to a single-dwelling interest are to be read in accordance with section 170.

PART 4 — Excise duties and other taxes

Inheritance tax

Open- ended investment companies and authorised unit trusts

175

(1) In section 65 of IHTA 1984 (settlements without interests in possession etc: charge when property ceases to be relevant property etc), after subsection (7) insert—

(7A) Tax shall not be charged under this section by reason only that property comprised in a settlement becomes excluded property by virtue of section 48(3A)(a) (holding in an authorised unit trust or a share in an open-ended investment company is excluded property unless settlor domiciled in UK when settlement made).

(2) The amendment made by this section is treated as having come into force on 16 October 2002.

Treatment of liabilities for inheritance tax purposes

176

Schedule 36 makes provision in relation to the treatment of liabilities for the purposes of inheritance tax.

Election to be treated as domiciled in United Kingdom

177

(1) IHTA 1984 is amended as follows.

(2) In section 267 (persons treated as domiciled in United Kingdom), at the end insert—

(5) In determining for the purposes of this section whether a person is, or at any time was, domiciled in the United Kingdom, sections 267ZA and 267ZB are to be ignored.

(3) After that section insert—

(267ZA) (1) A person may, if condition A or B is met, elect to be treated for the purposes of this Act as domiciled in the United Kingdom (and not elsewhere). (2) A person's personal representatives may, if condition B is met, elect for the person to be treated for the purposes of this Act as domiciled in the United Kingdom (and not elsewhere). (3) Condition A is that, at any time on or after 6 April 2013 and during the period of 7 years ending with the date on which the election is made, the person had a spouse or civil partner who was domiciled in the United Kingdom. (4) Condition B is that a person (“the deceased”) dies and, at any time on or after 6 April 2013 and within the period of 7 years ending with the date of death, the deceased was— (a) domiciled in the United Kingdom, and (b) the spouse or civil partner of the person who would, by virtue of the election, be treated as domiciled in the United Kingdom. (5) An election under this section does not affect a person's domicile for the purposes of section 6(2) or (3) or 48(4). (6) An election under this section is to be ignored— (a) in interpreting any such provision as is mentioned in section 158(6), and (b) in determining the effect of any qualifying double taxation relief arrangements in relation to a transfer of value by the person making the election. (7) For the purposes of subsection (6)(b) a qualifying double taxation relief arrangement is an arrangement which is specified in an Order in Council made under section 158 before the coming into force of this section (other than by way of amendment by an Order made on or after the coming into force of this section). (8) In determining for the purposes of this section whether a person making an election under this section is or was domiciled in the United Kingdom, section 267 is to be ignored. (267ZB) (1) For the purposes of this section— (a) references to a lifetime election are to an election made by virtue of section 267ZA(3), and (b) references to a death election are to an election made by virtue of section 267ZA(4). (2) A lifetime or death election is to be made by notice in writing to HMRC. (3) A lifetime or death election is treated as having taken effect on a date specified, in accordance with subsection (4), in the notice. (4) The date specified in a notice under subsection (3) must— (a) be 6 April 2013 or a later date, (b) be within the period of 7 years ending with— (i) in the case of a lifetime election, the date on which the election is made, or (ii) in the case of a death election, the date of the deceased's death, and (c) meet the condition in subsection (5). (5) The condition in this subsection is met by a date if, on the date— (a) in the case of a lifetime election— (i) the person making the election was married to, or in a civil partnership with, the spouse or civil partner, and (ii) the spouse or civil partner was domiciled in the United Kingdom, or (b) in the case of a death election— (i) the person who is, by virtue of the election, to be treated as domiciled in the United Kingdom was married to, or in a civil partnership with, the deceased, and (ii) the deceased was domiciled in the United Kingdom. (6) A death election may only be made within 2 years of the death of the deceased or such longer period as an officer of Revenue and Customs may in the particular case allow. (7) Subsection (8) applies if— (a) a lifetime or death election is made, (b) a disposition is made, or another event occurs, during the period beginning with the time when the election is treated by virtue of subsection (3) as having taken effect and ending at the time when the election is made, and (c) the effect of the election being treated as having taken effect at that time is that the disposition or event gives rise to a transfer of value. (8) This Act applies with the following modifications in relation to the transfer of value— (a) subsections (1) and (6)(c) of section 216 have effect as if the period specified in subsection (6)(c) of that section were the period of 12 months from the end of the month in which the election is made, and (b) sections 226 and 233 have effect as if the transfer were made at the time when the election is made. (9) A lifetime or death election cannot be revoked. (10) If a person who made an election under section 267ZA(1) is not resident in the United Kingdom for the purposes of income tax for a period of four successive tax years beginning at any time after the election is made, the election ceases to have effect at the end of that period.

Transfer to spouse or civil partner not domiciled in United Kingdom

178

(1) Section 18 of IHTA 1984 (transfers between spouses or civil partners) is amended as follows.

(2) In subsection (2) (transfer to spouse or civil partner not domiciled in United Kingdom), for “£55,000” substitute “ the exemption limit at the time of the transfer, ”.

(3) After subsection (2) insert—

(2A) For the purposes of subsection (2), the exemption limit is the amount shown in the second column of the first row of the Table in Schedule 1 (upper limit of portion of value charged at rate of nil per cent).

(4) The amendments made by this section have effect in relation to transfers of value made on or after 6 April 2013.

Fuel

Fuel duties: rates of duty and rebates from 1 April 2013

179

(1) HODA 1979 is amended as follows.

(2) In section 6(1A) (main rates)—

(a) in paragraph (a) (unleaded petrol), for “£0.6097” substitute “ £0.5795 ”,

(b) in paragraph (aa) (aviation gasoline), for “£0.3966” substitute “ £0.3770 ”,

(c) in paragraph (b) (light oil other than unleaded petrol or aviation gasoline), for “£0.7069” substitute “ £0.6767 ”, and

(d) in paragraph (c) (heavy oil), for “£0.6097” substitute “ £0.5795 ”.

(3) In section 8(3) (road fuel gas)—

(a) in paragraph (a) (natural road fuel gas), for “£0.2907” substitute “ £0.2470 ”, and

(b) in paragraph (b) (other road fuel gas), for “£0.3734” substitute “ £0.3161 ”.

(4) In section 11(1) (rebate on heavy oil)—

(a) in paragraph (a) (fuel oil), for “£0.1126” substitute “ £0.1070 ”, and

(b) in paragraph (b) (gas oil), for “£0.1172” substitute “ £0.1114 ”.

(5) In section 14(1) (rebate on light oil for use as furnace fuel), for “£0.1126” substitute “ £0.1070 ”.

(6) In section 14A(2) (rebate on certain biodiesel), for “£0.1172” substitute “ £0.1114 ”.

(7) The following instruments are revoked—

(a) Excise Duties (Surcharges or Rebates) (Hydrocarbon Oils etc) Order 2012 (S.I. 2012/3055), and

(b) Excise Duties (Road Fuel Gas) (Reliefs) Regulations 2012 (S.I. 2012/3056).

(8) The amendments and revocations made by this section are treated as having come into force on 1 April 2013.

Alcohol

Rates of alcoholic liquor duties

180

(1) ALDA 1979 is amended as follows.

(2) In section 5 (rate of duty on spirits), for “£26.81” substitute “ £28.22 ”.

(3) In section 36(1AA) (rates of general beer duty)—

(a) in paragraph (za) (rate of duty on lower strength beer), for “£9.76” substitute “ £9.17 ”, and

(b) in paragraph (a) (standard rate of duty on beer), for “£19.51” substitute “ £19.12 ”.

(4) In section 37(4) (rate of high strength beer duty), for “£4.88” substitute “ £5.09 ”.

(5) In section 62(1A) (rates of duty on cider)—

(a) in paragraph (a) (rate of duty per hectolitre on sparkling cider of a strength exceeding 5.5 per cent), for “£245.32” substitute “ £258.23 ”,

(b) in paragraph (b) (rate of duty per hectolitre on cider of a strength exceeding 7.5 per cent which is not sparkling cider), for “£56.55” substitute “ £59.52 ”, and

(6) For the table in Schedule 1 substitute—

Table of rates of duty on wine and made-wine

Description of wine or made-wine	Rates of duty per hectolitre £
Wine or made-wine of a strength not exceeding 4 per cent	82.18
Wine or made-wine of a strength exceeding 4 per cent but not exceeding 5.5 per cent	113.01
Wine or made-wine of a strength exceeding 5.5 per cent but not exceeding 15 per cent and not being sparkling	266.72
Sparkling wine or sparkling made-wine of a strength exceeding 5.5 per cent but less than 8.5 per cent	258.23
Sparkling wine or sparkling made-wine of a strength of 8.5 per cent or of a strength exceeding 8.5 per cent but not exceeding 15 per cent	341.63
Wine or made-wine of a strength exceeding 15 per cent but not exceeding 22 per cent	355.59
Description of wine or made-wine	Rates of duty per litre of alcohol in wine or made-wine £
---	---
Wine or made-wine of a strength exceeding 22 per cent	28.22

(7) The amendments made by this section are treated as having come into force on 25 March 2013.

Tobacco

Rates of tobacco products duty

181

(1) For the table in Schedule 1 to TPDA 1979 substitute—

1. Cigarettes	An amount equal to 16.5 per cent of the retail price plus £176.22 per thousand cigarettes
2. Cigars	£219.82 per kilogram
3. Hand-rolling tobacco	£172.74 per kilogram
4. Other smoking tobacco and chewing tobacco	£96.64 per kilogram

(2) The amendment made by this section is treated as having come into force at 6 pm on 20 March 2013.

Meaning of “tobacco products”

182

(1) Section 1 of TPDA 1979 (tobacco products) is amended as follows.

(2) In subsection (1), omit “, but does not include herbal smoking products”.

(3) After that subsection insert—

(1A) But a product is not a tobacco product for the purposes of this Act if— (a) the product does not contain any tobacco, and (b) the Commissioners are satisfied that— (i) the product is of a description that is used for medical purposes, and (ii) the product is intended to be used exclusively for such purposes.

(4) In subsection (3), omit “but not including herbal smoking products”.

(5) Omit subsection (6).

(6) The amendments made by this section come into force on 1 January 2014.

Gambling

Rates of gaming duty

183

(1) In section 11(2) of FA 1997 (rates of gaming duty), for the table substitute—

Part of gross gaming yield	Rate
The first £2,242,500	15 per cent
The next £1,546,000	20 per cent
The next £2,707,500	30 per cent
The next £5,714,500	40 per cent
The remainder	50 per cent

(2) The amendment made by this section has effect in relation to accounting periods beginning on or after 1 April 2013.

Combined bingo

184

(1) Section 20A of BGDA 1981 (combined bingo) is amended as follows.

(2) In subsection (3) for the words from the beginning to “second promoter”)—” substitute “Where money representing such payments (so far as they constituted stakes hazarded in the combined bingo) is paid in an accounting period by one promoter of the bingo (“the first promoter”) to another (“the second promoter”), to the extent that the money is used (directly or indirectly) to provide bingo winnings for combined bingo promoted by the second promoter—”.

(3) Omit subsection (4).

(4) The amendments made by this section have effect in relation to accounting periods beginning on or after the day on which this Act is passed.

Air passenger duty

Air passenger duty: rates of duty from 1 April 2013

185

(1) Section 30 of FA 1994 (air passenger duty: rates of duty) is amended as follows.

(2) In subsection (3)—

(a) in paragraph (a) for “£65” substitute “ £67 ”, and

(b) in paragraph (b) for “£130” substitute “ £134 ”.

(3) In subsection (4)—

(a) in paragraph (a) for “£81” substitute “ £83 ”, and

(b) in paragraph (b) for “£162” substitute “ £166 ”.

(4) In subsection (4A)—

(a) in paragraph (a) for “£92” substitute “ £94 ”, and

(b) in paragraph (b) for “£184” substitute “ £188 ”.

(5) The amendments made by this section have effect in relation to the carriage of passengers beginning on or after 1 April 2013.

Air passenger duty: miscellaneous provision

186

(1) In section 38 of FA 1994 (accounting for and payment of duty) after subsection (2) insert—

(2A) Regulations may require a prescribed person to make, at prescribed times during a prescribed period, payments based on an estimate of what the person's liability will be for duty charged in the period. (2B) The estimate and the amounts of the payments are to be determined in accordance with provision made by the regulations. (2C) The payments are to be treated as being payments on account of the person's liability for duty charged in the period. (2D) The regulations must make provision for dealing with cases where this results in an overpayment of duty by providing for amounts— (a) to be repaid by the Commissioners, or (b) to be treated as having been paid on account of the person's liability for duty charged in other periods, or both.

(2) In Part 2 of Schedule 5A to FA 1994 (territories etc) at the appropriate place insert “ South Sudan ”.

(3) The amendment made by subsection (2) has effect in relation to the carriage of passengers beginning on or after 9 July 2011.

Vehicle excise duty

VED rates for light passenger vehicles, light goods vehicles, motorcycles etc

187

(1) Schedule 1 to VERA 1994 (annual rates of duty) is amended as follows.

(2) In paragraph 1 (general)—

(a) in sub-paragraph (2) (vehicle not covered elsewhere in Schedule otherwise than with engine cylinder capacity not exceeding 1,549cc), for “£220” substitute “ £225 ”, and

(b) in sub-paragraph (2A) (vehicle not covered elsewhere in Schedule with engine cylinder capacity not exceeding 1,549cc), for “£135” substitute “ £140 ”.

(3) In paragraph 1B (graduated rates of duty for light passenger vehicles)—

(a) for the tables substitute—

CO₂ emissions figure	CO₂ emissions figure	Rate	Rate
(1)	(2)	(3)	(4)
Exceeding	Not exceeding	Reduced rate	Standard rate
g/km	g/km	£	£
130	140	115	125
140	150	130	140
150	165	165	175
165	175	275	285
175	185	325	335
185	200	465	475
200	225	610	620
225	255	830	840
255		1055	1065
CO₂ emissions figure	CO₂ emissions figure	Rate	Rate
---	---	---	---
(1)	(2)	(3)	(4)
Exceeding	Not exceeding	Reduced rate	Standard rate
g/km	g/km	£	£
100	110	10	20
110	120	20	30
120	130	95	105
130	140	115	125
140	150	130	140
150	165	165	175
165	175	190	200
175	185	210	220
185	200	250	260
200	225	270	280
225	255	465	475
255		480	490

;

(b) in the sentence immediately following the tables, for paragraphs (a) and (b) substitute—

(a) in column (3), in the last two rows, “270” were substituted for “465” and “ 480 ”, and (b) in column (4), in the last two rows, “280” were substituted for “475” and “ 490 ”.

(4) In paragraph 1J (VED rates for light goods vehicles)—

(a) in paragraph (a), for “£215” substitute “ £220 ”, and

(b) in paragraph (b), for “£135” substitute “ £140 ”.

(5) In paragraph 2(1) (VED rates for motorcycles)—

(a) in paragraph (a), for “£16” substitute “ £17 ”,

(b) in paragraph (b), for “£36” substitute “ £37 ”,

(d) in paragraph (d), for “£76” substitute “ £78 ”.

(6) The amendments made by this section have effect in relation to licences taken out on or after 1 April 2013.

Not exhibiting licence: period of grace

188

(1) In section 33 of VERA 1994 (not exhibiting licence), omit subsections (1B) to (1D).

(2) After that section insert—

(33A) (1) A person is not guilty of an offence under subsection (1) or (1A) of section 33 by using or keeping a vehicle on a public road during any of the following periods. - First registration The period of 14 days beginning with the day on which the vehicle is first registered under this Act. - Change of keeper The period of 14 days beginning with the day on which a new licence or nil licence is issued for the vehicle because of a change in the person by whom the vehicle is being kept. - Renewal etc. The period of 14 days following the time when a licence or nil licence for or in respect of the vehicle, or a relevant declaration applying to the vehicle, ceases to be in force, but only if an application for a licence or nil licence for or in respect of the vehicle to run from that time has been received before that time. - Replacement The period beginning with the time when a licence or nil licence that is in force for or in respect of the vehicle is delivered to the Secretary of State with an application for a replacement licence, and ending with the time when the replacement licence is obtained. (2) For the purposes of this section— (a) there is a relevant declaration applying to a vehicle if the particulars and declaration required to be furnished and made by regulations under section 22(1D) have been furnished and made in relation to the vehicle in accordance with the regulations, and (b) the relevant declaration ceases to be in force if, after the particulars and declaration have been furnished and made the vehicle is used or kept on a public road (otherwise than under a trade licence).

(3) In consequence of the provision made by subsections (1) and (2) omit—

(a) section 147 of FA 2008, and

(b) in regulation 6 of the Road Vehicles (Registration and Licensing) Regulations 2002 (S.I. 2002/2742), paragraph (1) and, in paragraph (2), the words “Except where paragraph (1) applies,”.

Vehicles not kept or used on public road

189

(1) VERA 1994 is amended as follows.

(2) In section 7A (supplement payable on vehicle ceasing to be appropriately covered), in subsection (1A)(d) omit “within the immediately preceding period of 12 months”.

(3) In Schedule 2A (immobilisation, removal and disposal of vehicles), in paragraph 1(10)(b) omit “within the immediately preceding period of 12 months”.

Vehicle licences for disabled people

190

Schedule 37 makes provision about vehicle licences for disabled people.

Value added tax

Repayments of value added tax to health service bodies

191

(1) In section 41 of VATA 1994 (application to the Crown), in subsection (7), after “Board” insert “ and a clinical commissioning group, the Health and Social Care Information Centre, the National Health Service Commissioning Board and the National Institute for Health and Care Excellence ”.

(2) The amendment made by this section is treated as having come into force on 1 April 2013.

Valuation of certain supplies of fuel

192

Schedule 38 contains provision about the valuation of certain supplies of fuel for the purposes of value added tax.

Reduced rate for energy-saving materials

193

(1) Group 2 (installation of energy-saving materials) of Part 2 of Schedule 7A to VATA 1994 (reduced rate supplies of goods and services) is amended as follows.

(2) For items 1 and 2 substitute—

(1) Supplies of services of installing energy-saving materials in residential accommodation. (2) Supplies of energy-saving materials by a person who installs those materials in residential accommodation.

(3) Omit Note 3 (meaning of “use for a relevant charitable purpose”).

(4) The amendments made by this section have effect in relation to supplies made on or after 1 August 2013.

Stamp duty land tax

Pre-completion transactions: existing cases

194

(1) Section 45 of FA 2003 (contract and conveyance: effect of transfer of rights)—

(a) has effect subject to the amendment in subsection (2) below in relation to agreements for the grant or assignment of an option that are entered into during the period beginning with 21 March 2012 and ending immediately before the day on which this Act is passed, and

(b) has effect subject to the amendments in subsections (3) to (7) below in relation to transfers of rights (see subsection (1) of that section) entered into during that period.

(2) At the end of subsection (1A) insert “ or an agreement for the future grant or assignment of an option ”.

(3) In subsection (3), in the second sentence, after “except” insert “ in a case excluded by subsection (3A) or ”.

(4) After subsection (3) insert—

(3A) A case is excluded by this subsection from the second sentence of subsection (3) if— (a) the secondary contract is substantially performed at the same time as, and in connection with, the substantial performance or completion of the original contract but is not completed at that time (“the relevant time”), (b) the original purchaser or a person connected with the original purchaser is in possession of the whole, or substantially the whole, of the subject-matter of the transfer of rights at any time after the relevant time, and (c) having regard to all the circumstances, it would be reasonable to conclude that the obtaining of a tax advantage for the original purchaser was the main purpose, or one of the main purposes, of the original purchaser in entering into the transfer of rights. (3B) In subsection (3A)— - “possession” has the same meaning as in section 44(5)(a); - “tax advantage” means— 1. a relief from tax or increased relief from tax, 2. a repayment of tax or increased repayment of tax, or 3. the avoidance or reduction of a charge to tax. (3C) Nothing in subsection (3A) or (3B) affects the breadth of the application of sections 75A to 75C.

(5) In subsection (4), at the end insert “ except in a case excluded by subsection (4A) ”.

(6) After subsection (4) insert—

(4A) Subsection (3A) applies for the purposes of subsection (4) as if— (a) the reference to subsection (3) were a reference to subsection (4), (b) a reference to the original contract were a reference to the secondary contract arising from the earlier transfer of rights, (c) a reference to the original purchaser were a reference to the transferee under the earlier transfer of rights, and (d) a reference to the transfer of rights were a reference to the subsequent transfer of rights.

(7) In subsection (5)(b)—

(a) after “subsection (3) above” insert “ or in subsection (3A) above ”, and

(b) after “subsection (4)” insert “ or (4A) ”.

(8) Subsections (10) to (12) apply where—

(a) as a result of subsection (2) of this section, section 45 of FA 2003 does not apply in relation to a contract of the kind mentioned in subsection (1)(a) of that section (“the original contract”),

(b) the original contract was substantially performed or completed (or, in a case that would have fallen within subsection (5) of that section, substantially performed or completed so far as relating to the relevant part of the subject-matter of the original contract) at the same time as, and in connection with, the substantial performance or completion of an agreement for the grant or assignment of an option, and

(9) Subsections (10) to (12) also apply where—

(a) section 45 of FA 2003 applies in relation to the contract for a land transaction (“the original contract”),

(b) as a result of subsections (1) to (7) above, the substantial performance or completion of the original contract (or, in a case within subsection (5) of that section, its substantial performance or completion so far as relating to part of the subject-matter of the original contract) is not disregarded, and

(10) Section 76 of FA 2003 (duty to deliver land transaction return) is to be regarded as requiring the purchaser under the original contract to deliver a land transaction return relating to the land transaction not later than 30 September 2013.

(11) Accordingly, 30 September 2013 is for the purposes of Part 4 of FA 2003 the filing date for the land transaction return relating to the transaction.

(12) If the purchaser under the original contract (“P”) has delivered a land transaction return relating to the land transaction before the day on which this Act is passed, P must not later than 30 September 2013 give notice under paragraph 6 of Schedule 10 to FA 2003 amending the return, but this does not prevent P from making subsequent amendments within the time allowed by sub-paragraph (3) of that paragraph.

Pre-completion transactions

195

Schedule 39 contains provisions about certain transactions relating to a contract that is to be completed by a conveyance.

Relief from higher rate

196

Schedule 40 contains provisions about relief from the higher rate of stamp duty land tax.

Leases

197

Schedule 41 contains provision about stamp duty land tax in relation to leases.

Landfill tax

Standard rate of landfill tax

198

(1) Section 42 of FA 1996 (amount of landfill tax) is amended as follows.

(2) In subsection (1)(a) (standard rate), for “£72” substitute “ £80 ”.

(3) In subsection (2) (reduced rate) for “£72” substitute “ £80 ”.

(4) The amendments made by this section have effect in relation to disposals made (or treated as made) on or after 1 April 2014.

Climate change levy

Climate change levy: main rates

199

(1) In paragraph 42(1) of Schedule 6 to FA 2000 (climate change levy: amount payable by way of levy) for the table substitute—

Taxable commodity supplied	Rate at which levy payable if supply is not a reduced-rate supply or a supply for use in scrap metal recycling
Electricity	£0.00541 per kilowatt hour
Gas supplied by a gas utility or any gas supplied in a gaseous state that is of a kind supplied by a gas utility	£0.00188 per kilowatt hour
Any petroleum gas, or other gaseous hydrocarbon, supplied in a liquid state	£0.01210 per kilogram
Any other taxable commodity	£0.01476 per kilogram

(2) The amendment made by subsection (1) has effect in relation to supplies treated as taking place on or after 1 April 2014.

Climate change levy: supplies subject to carbon price support rates etc

200

Schedule 42 amends Schedule 6 to FA 2000 (climate change levy).

Insurance premium tax

Contracts that are not taxable

201

(1) In Schedule 7A to FA 1994 (IPT: contracts that are not taxable), paragraph 3 (contracts relating to motor vehicles for use by handicapped persons) is amended as follows.

(2) In sub-paragraph (2)(a)—

(a) after “disability living allowance” insert “ , or personal independence payment, ” and

(b) after “component” insert “ , or of an armed forces independence payment ”.

(3) In sub-paragraph (3), after “disability living allowance” insert “ , personal independence payment, armed forces independence payment ”.

(4) After sub-paragraph (4)(b) insert—

(ba) personal independence payment” means a personal independence payment under Part 4 of the Welfare Reform Act 2012 or the corresponding provision having effect in Northern Ireland; (bb) “armed forces independence payment” means an armed forces independence payment under a scheme established under section 1 of the Armed Forces (Pensions and Contributions) Act 2004;

(5) The amendments made by this section are treated as having come into force on 8 April 2013.

Bank levy

Bank levy: rates from 1 January 2013

202

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

(2) In paragraph 6 (steps for determining the amount of the bank levy), in sub-paragraph (2)—

(a) for “0.044%” substitute “ 0.065% ”, and

(b) for “0.088%” substitute “ 0.130% ”.

(3) In paragraph 7 (special provision for chargeable periods falling wholly or partly before 1 January 2013), in sub-paragraph (2) (as substituted by paragraph 6 of Schedule 34 to FA 2012), in the table in the substituted Step 7—

(a) in the second column for “0.0525%” substitute “ 0.065% ”, and

(b) in the third column for “0.105%” substitute “ 0.130% ”.

(4) In Schedule 34 to FA 2012 (bank levy)—

(a) omit paragraph 5 (which substituted new rates from 1 January 2013), and

(b) in paragraph 7 for “paragraphs 5 and” substitute “ paragraph ”.

(5) The amendments made by subsections (2) to (4) are treated as having come into force on 1 January 2013 (and accordingly the paragraph repealed by subsection (4) is treated as never having come into force).

(6) Subsections (7) to (13) apply where—

(a) an amount of the bank levy is treated as if it were an amount of corporation tax chargeable on an entity (“E”) for an accounting period of E,

(b) the chargeable period in respect of which the amount of the bank levy is charged falls (or partly falls) on or after 1 January 2013, and

(c) under the Instalment Payment Regulations, one or more instalment payments, in respect of the total liability of E for the accounting period, were treated as becoming due and payable before the commencement date (“pre-commencement instalment payments”).

(7) Subsections (1) to (5) are to be ignored for the purpose of determining the amount of any pre-commencement instalment payment.

(8) If there is at least one instalment payment, in respect of the total liability of E for the accounting period, which under the Instalment Payment Regulations is treated as becoming due and payable on or after the commencement date (“post-commencement instalment payments”), the amount of that instalment payment, or the first of them, is to be increased by the adjustment amount.

(9) If there are no post-commencement instalment payments, a further instalment payment, in respect of the total liability of E for the accounting period, of an amount equal to the adjustment amount is to be treated as becoming due and payable at the end of the period of 30 days beginning with the commencement date.

(10) “The adjustment amount” is the difference between—

(a) the aggregate amount of the pre-commencement instalments determined in accordance with subsection (7), and

(b) the aggregate amount of those instalment payments determined ignoring subsection (7) (and so taking account of subsections (1) to (5)).

(11) In the Instalment Payment Regulations—

(a) in regulations 6(1)(a), 7(2), 8(1)(a) and (2)(a), 9(5), 10(1), 11(1) and 13, references to regulation 4A, 4B, 4C, 4D, 5, 5A or 5B of those Regulations are to be read as including a reference to subsections (6) to (10) (and in regulation 7(2) “the regulation in question”, and in regulation 8(2) “that regulation”, are to be read accordingly), and

(b) in regulation 9(3), the reference to those Regulations is to be read as including a reference to subsections (6) to (10).

(12) In section 59D of TMA 1970 (general rule as to when corporation tax is due and payable), in subsection (5), the reference to section 59E is to be read as including a reference to subsections (6) to (11).

(13) In this section—

“the chargeable period” is to be construed in accordance with paragraph 4 or (as the case may be) 5 of Schedule 19 to FA 2011;

“the commencement date” means the day on which this Act is passed;

“the Instalment Payment Regulations” means the Corporation Tax (Instalment Payments) Regulations 1998 (S.I. 1998/3175);

and references to the total liability of E for an accounting period are to be construed in accordance with regulation 2(3) of the Instalment Payment Regulations.

Bank levy: rates from 1 January 2014

203

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

No deductions for UK or foreign bank levies

204

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

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

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

(69A) (1) In calculating profits or losses for the purposes of income tax or corporation tax— (a) no deduction is allowed in respect of any tax which is imposed by the law of a territory outside the United Kingdom and corresponds to the bank levy, and (b) no account is to be taken of any amount which is paid (directly or indirectly) by a member of a group to another member for the purposes of meeting or reimbursing the cost of such a tax charged in relation to the group. (2) Paragraph 66(3) applies for the purposes of sub-paragraph (1) as it applies for the purposes of paragraph 66(2).

(4) Accordingly—

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

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

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

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

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

High quality liquid assets

205

(1) In paragraph 70 of Schedule 19 to FA 2011 (bank levy: definitions), in sub-paragraph (1), in the definition of “high quality liquid asset” for “section 12.7.2(1) to (4)” substitute “section 12.7 (assets that are eligible for inclusion in a firm's regulatory liquid assets buffer)'.

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