Finance (No. 2) Act 2015

(2A) Subsection (2B) applies if— (a) by virtue of subsection (2), no valuation of the stock under this Chapter is required, and (b) the market value of the stock is greater than the Part 4 TIOPA amount. (2B) An amount equal to the market value of the stock less the Part 4 TIOPA amount is to be brought into account in calculating the profits of the trade (in addition to the Part 4 TIOPA amount). (2C) In subsections (2A) and (2B)— - “market value”, in relation to stock, is the value the stock would have been determined to have if it had been valued in accordance with sections 164 to 167, and - “Part 4 TIOPA amount” is the amount which, following the application of Part 4 of TIOPA 2010 in relation to the provision referred to in subsection (2), is brought into account in respect of that provision in calculating the profits of the trade.

• (2) In section 173 of ITTOIA 2005 (valuation of trading stock on cessation), after subsection (2) (transfer pricing rules to take precedence) insert—

(2A) Subsection (2B) applies if— (a) by virtue of subsection (2), no valuation of the stock under this Chapter is required, and (b) the market value of the stock is greater than the Part 4 TIOPA amount. (2B) An amount equal to the market value of the stock less the Part 4 TIOPA amount is to be brought into account in calculating the profits of the trade (in addition to the Part 4 TIOPA amount). (2C) In subsections (2A) and (2B)— - “market value”, in relation to stock, is the value the stock would have been determined to have if it had been valued in accordance with sections 175 to 178, and - “Part 4 TIOPA amount” is the amount which, following the application of Part 4 of TIOPA 2010 in relation to the provision referred to in subsection (2), is brought into account in respect of that provision in calculating the profits of the trade.

• (3) The amendments made by this section apply in relation to a cessation of trade on or after 8 July 2015.

Transfer of intangible assets not at arm’s length

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• (1) In section 846 of CTA 2009 (transfers of intangible assets not at arm's length), after subsection (1) insert—

(1A) Subsection (1B) applies in relation to the transfer of an intangible asset where— (a) by virtue of subsection (1), section 845 does not apply, and (b) the market value of the asset is greater than the Part 4 TIOPA amount. (1B) An amount equal to the market value of the asset less the Part 4 TIOPA amount is to be brought into account for the purposes of corporation tax in relation to the transfer (in addition to the Part 4 TIOPA amount). (1C) In subsections (1A) and (1B)— - “market value”, in relation to an asset, has the meaning given in section 845(5); - “Part 4 TIOPA amount” means the amount which, following the application of Part 4 of TIOPA 2010 in relation to the consideration for the transfer, is brought into account in respect of the consideration for the purposes of corporation tax.

• (2) The amendment made by this section applies in relation to a transfer which takes place on or after 8 July 2015, unless it takes place pursuant to an obligation, under a contract, that was unconditional before that date.

• (3) For the purposes of subsection (2), an obligation is “unconditional” if it may not be varied or extinguished by the exercise of a right (whether under the contract or otherwise).

Income tax and capital gains tax

Carried interest

43

• (1) In Part 3 of TCGA 1992 (individuals, partnerships, trusts and collective investment schemes etc), after section 103K insert—

(103KA) (1) This section applies where— (a) an individual (“A”) performs investment management services directly or indirectly in respect of an investment scheme under arrangements involving at least one partnership, and (b) carried interest arises to A under the arrangements. (2) If the carried interest arises to A in connection with the disposal of one or more assets of the partnership or partnerships— (a) a chargeable gain equal to the amount of the carried interest less any permitted deductions (and no other chargeable gain or loss) is to be treated as accruing to A on the disposal, and (b) the chargeable gain is to be treated as accruing to A at the time the carried interest arises. (3) If the carried interest arises to A in circumstances other than those specified in subsection (2), a chargeable gain of an amount equal to the amount of the carried interest less any permitted deductions is to be treated as accruing to A at the time the carried interest arises. (4) Subsections (2) and (3) do not apply in relation to carried interest to the extent that— (a) it is brought into account in calculating the profits of a trade of A for the purposes of income tax for any tax year, or (b) it constitutes a co-investment repayment or return. (5) For the purpose of subsections (2) and (3) “permitted deductions” in relation to A means such parts of the amounts specified in subsection (6) as is just and reasonable. (6) The amounts referred to in subsection (5) are— (a) the amount of any consideration in money given to the scheme by or on behalf of A wholly and exclusively for entering into the arrangements referred to in subsection (1)(a) (but not consideration in respect of co-investments), (b) any amount that constituted earnings of A under Chapter 1 of Part 3 of ITEPA 2003 (earnings) in respect of A's entering into those arrangements (but not any earnings in respect of co-investments or any amount of exempt income within the meaning of section 8 of that Act), and (c) any amount which, by reason of events occurring no later than the time the carried interest arises, counts as income of A under the enactments referred to in section 119A(3) in respect of A's participation in the arrangements referred to in subsection (1)(a) (but not an amount counting as income of A in respect of co-investments); and section 119A(5) applies for the purposes of this paragraph as it applies for the purposes of section 119A(4). For the purposes of this Act no other deduction may be made from the amount of the carried interest referred to in subsection (2) or (3). (7) Where the carried interest arises to A by virtue of his or her acquisition of a right to it from another person for consideration given in money by or on behalf of A, the amount of the chargeable gain accruing to A under subsection (2) or (3) is, on the making of a claim by A under this subsection, to be regarded as reduced by the amount of the consideration. (8) In this section— - “co-investment”, in relation to A, means an investment made directly or indirectly by A in the scheme, where there is no return on the investment which is not an arm's length return within the meaning of section 809EZB(2) of ITA 2007; - “co-investment repayment or return” means a repayment in whole or in part of, or a return on, a co-investment; - “trade” includes profession or vocation. (103KB) (1) For the purposes of section 103KA, consideration received or receivable by an individual for the disposal, variation, loss or cancellation of a right to carried interest is to be treated as carried interest arising to that individual at the time of the disposal, variation, loss or cancellation. (2) But subsection (1) does not apply if and to the extent that the consideration is a disguised fee arising to the individual for the purposes of section 809EZA of ITA 2007. (103KC) In a case where section 103KA applies, a chargeable gain accruing or treated as accruing to an individual in respect of carried interest is a foreign chargeable gain within the meaning of section 12 only to the extent that the individual performs the services referred to in section 103KA(1)(a) outside the United Kingdom. (103KD) In determining whether section 103KA applies in relation to an individual, no regard is to be had to any arrangements the main purpose, or one of the main purposes, of which is to secure that that section does not to any extent apply in relation to— (a) the individual, or (b) the individual and one or more other individuals. (103KE) (1) This section applies where— (a) capital gains tax is charged on an individual by virtue of section 103KA in respect of any carried interest, and (b) Condition A or Condition B is met. (2) Condition A is that— (a) at any time, tax (whether income tax or another tax) charged on the individual in relation to the carried interest has been paid by the individual (and has not been repaid), and (b) the amount on which tax is charged as specified in subsection (1)(a) is not a permissible deduction under section 103KA(6)(b) or (c). (3) Condition B is that at any time tax (whether income tax or another tax) charged on another person in relation to the carried interest has been paid by that other person (and has not been repaid). (4) In order to avoid a double charge to tax, the individual may make a claim for one or more consequential adjustments to be made in respect of the capital gains tax charged as mentioned in subsection (1)(a). (5) On a claim under this section an officer of Revenue and Customs must make such of the consequential adjustments claimed (if any) as are just and reasonable. (6) The value of any consequential adjustments made must not exceed the lesser of— (a) the capital gains tax charged as mentioned in subsection (1)(a), and (b) the tax charged as mentioned in subsection (2)(a) or (3). (7) Consequential adjustments may be made— (a) in respect of any period, (b) by way of an assessment, the modification of an assessment, the amendment of a claim, or otherwise, and (c) despite any time limit imposed by or under an enactment. (8) Where— (a) an individual makes a claim under this section in respect of a year of assessment, and (b) apart from this subsection, an amount falls to be deducted under section 2(2)(b) from the total amount of chargeable gains accruing to the individual in that year, the individual may elect that the amount to be so deducted be reduced by any amount not exceeding the amount on which tax is charged as specified in subsection (2)(a) or (3). (103KF) (1) If— (a) a chargeable gain accrues to an external investor in an investment scheme on the disposal of one or more partnership assets, and (b) the external investor makes a claim for relief under this section, then subsection (2) applies in relation to the disposal. (2) The amount of the chargeable gain is to be reduced by an amount equal to— $$I − C$where—I is an amount equal to such part of the sum invested in the fund by the external investor which on a just and reasonable basis is referable to the asset or assets disposed of, andC is the amount deducted under section 38(1)(a) in respect of consideration given wholly and exclusively for the acquisition of the asset or assets.$ (103KG) (1) For the purposes of this Chapter, carried interest “arises” to an individual (“A”) if, and only if, it arises to him or her for the purposes of Chapter 5E of Part 13 of ITA 2007. (2) But section 809EZDB of ITA 2007 (sums arising to connected company or unconnected person) does not apply in relation to a sum of carried interest arising to— (a) a company connected with A, or (b) a person not connected with A, where the sum is deferred carried interest in relation to A. (3) In this section, “deferred carried interest”, in relation to A— (a) means a sum of carried interest where the provision of the sum to A or a person connected with A is deferred (whether pending the meeting of any conditions (including conditions which may never be met) or otherwise), and (b) includes A's share (as determined on a just and reasonable basis) of any carried interest the provision of which to A and one or more other persons, taken together, has been deferred (whether pending the meeting of any conditions (including conditions which may never be met) or otherwise). In this subsection, in a case where the sum referred to in subsection (2) arises to a company connected with A, the reference to a person connected with A does not include that company. (4) Where— (a) section 809EZDB of ITA 2007 has been disapplied in relation to a sum of deferred carried interest by virtue of subsection (2), (b) the sum ceases to be deferred carried interest in relation to A, and (c) the sum does not in any event arise to A apart from this subsection, the sum is to be regarded as arising to A at the time it ceases to be deferred carried interest. (5) But subsection (4) does not apply if— (a) none of the enjoyment conditions is met in relation to the sum when it ceases to be deferred carried interest, and (b) there is no reasonable likelihood that any of those conditions will ever be met in relation to the sum. (6) The enjoyment conditions are— (a) the sum, or part of the sum, is in fact so dealt with by any person as to be calculated at some time to enure for the benefit of A or a person connected with A; (b) the sum's ceasing to be deferred carried interest in relation to A operates to increase the value to A or a person connected with A of any assets which— (i) A or the connected person holds, or (ii) are held for the benefit of A or the connected person; (c) A or a person connected with A receives or is entitled to receive at any time any benefit provided or to be provided out of the sum or part of the sum; (d) A or a person connected with A may become entitled to the beneficial enjoyment of the sum or part of the sum if one or more powers are exercised or successively exercised (and for these purposes it does not matter who may exercise the powers or whether they are exercisable with or without the consent of another person); (e) A or a person connected with A is able in any manner to control directly or indirectly the application of the sum or part of the sum. In this subsection, in a case where the sum referred to in subsection (2) arises to a company connected with A, references to a person connected with A do not include that company. (7) In determining whether any of the enjoyment conditions is met in relation to a sum or part of a sum— (a) regard must be had to the substantial result and effect of all the relevant circumstances, and (b) all benefits which may at any time accrue to a person as a result of the sum ceasing to be deferred carried interest in relation to A must be taken into account, irrespective of— (i) the nature or form of the benefits, or (ii) whether the person has legal or equitable rights in respect of the benefits. (8) The enjoyment condition in subsection (6)(b), (c) or (d) is to be treated as not met if it would be met only by reason of A holding shares or an interest in shares in a company. (9) The enjoyment condition in subsection (6)(a) or (e) is to be treated as not met if the sum referred to in subsection (2) arises to a company connected with A and— (a) the company is liable to pay corporation tax in respect of its profits and the sum is included in the computation of those profits, or (b) paragraph (a) does not apply but— (i) the company is a CFC and the exemption in Chapter 14 of Part 9A of TIOPA 2010 applies for the accounting period in which the sum arises, or (ii) the company is not a CFC but, if it were, that exemption would apply for that period. In this subsection “CFC” has the same meaning as in Part 9A of TIOPA 2010. (10) But subsections (8) and (9) do not apply if the sum referred to in subsection (2) arises to the company referred to in subsection (2)(a) or the person referred to in subsection (2)(b) as part of arrangements where— (a) it is reasonable to assume that in the absence of the arrangements the sum or part of the sum would have arisen to A or an individual connected with A, and (b) it is reasonable to assume that the arrangements have as their main purpose, or one of their main purposes, the avoidance of a liability to pay income tax, capital gains tax, inheritance tax or corporation tax. (11) The condition in subsection (10)(b) is to be regarded as met in a case where the sum is applied directly or indirectly as an investment in a collective investment scheme. (12) Subsection (2) does not apply in relation to any sum in relation to which the condition in subsection (8)(b) of section 809EZDB is met by virtue of subsection (9) of that section. (13) Subsection (2) also does not apply if— (a) it is reasonable to assume that the deferral referred to in subsection (3)(a) or (b) is not the effect of genuine commercial arrangements, or (b) that deferral is the effect of such arrangements but it is reasonable to assume that the arrangements have as their main purpose, or one of their main purposes, the avoidance of a liability to pay income tax, capital gains tax, corporation tax or inheritance tax. (14) In subsection (13), “genuine commercial arrangements” means arrangements involving A (alone or jointly with others performing investment management services) and external investors in the investment scheme. (15) Section 993 of ITA 2007 (meaning of “connected”) applies for the purposes of this section but as if— (a) subsection (4) of that section were omitted, and (b) partners in a partnership in which A is also a partner were not “associates” of A for the purposes of sections 450 and 451 of CTA 2010 (“control”). (103KH) (1) In this Chapter— - “arrangements” has the same meaning as in Chapter 5E of Part 13 of ITA 2007 (see section 809EZE of that Act); - “carried interest”, in relation to arrangements referred to in section 103KA(1)(a), has the same meaning as in section 809EZB of ITA 2007 (see sections 809EZC and 809EZD of that Act); - “investment scheme”, “investment management services” and “external investor” have the same meanings as in Chapter 5E of Part 13 of ITA 2007 (see sections 809EZA(6) and 809EZE of that Act).

• (2) The amendment made by subsection (1) has effect in relation to carried interest arising on or after 8 July 2015 under any arrangements, ....

• (3) But section 103KB(1) of TCGA 1992 (as inserted by subsection (1)) does not have effect in relation to a variation of a right to carried interest occurring on or after 8 July 2015 and before 22 October 2015.

• (4) And section 103KG(2) to (15) of TCGA 1992 (as inserted by subsection (1)) has effect in relation to carried interest arising on or after 22 October 2015 under any arrangements, ....

• (5) In subsections (2) to (4), “arise”, “arrangements” and “carried interest” have the same meanings as in Chapter 5 of Part 3 of TCGA 1992 (as inserted by subsection (1) of this section).

Disguised investment management fees

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• (1) In section 809EZB of ITA 2007 (disguised investment management fees: meaning of “management fee”), after subsection (2) insert—

(2A) For the purposes of subsection (2)(b), the return on the investment is reasonably comparable to the return to external investors on the investments referred to in subsection (2)(a) if (and only if)— (a) the rate of return on the investment is reasonably comparable to the rate of return to external investors on those investments, and (b) any other factors relevant to determining the size of the return on the investment are reasonably comparable to the factors determining the size of the return to external investors on those investments.

• (2) In section 809EZG of ITA 2007 (avoidance of double taxation), in subsection (1)(b), after “the individual” insert “ or another person ”.

• (3) The amendments made by this section have effect in relation to sums arising on or after 8 July 2015 (whenever the arrangements under which the sums arise were made).

• (4) In subsection (3), “arise” has the same meaning as it has for the purposes of Chapter 5E of Part 13 of ITA 2007.

Carried interest and disguised investment management fees: “arise”

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• (1) In ITA 2007, after section 809EZD insert—

(809EZDA) (1) This section applies in relation to an individual (“A”) if— (a) a sum arises to a person (“B”) who is connected with A, (b) B is not a company, (c) income tax is not charged on B in respect of the sum by virtue of this Chapter, (d) capital gains tax is not charged on B in respect of the sum by virtue of Chapter 5 of Part 3 of TCGA 1992, and (e) the sum does not arise to A apart from this section. (2) The sum referred to in subsection (1)(a) arises to A for the purposes of this Chapter. (3) Where a sum arises to A by virtue of this section, it arises to A at the time the sum referred to in subsection (1)(a) arises to B. (4) Section 993 (meaning of “connected”) applies for the purposes of this section, but as if— (a) subsection (4) of that section were omitted, and (b) partners in a partnership in which A is also a partner were not “associates” of A for the purposes of sections 450 and 451 of CTA 2010 (“control”). (809EZDB) (1) This section applies in relation to an individual (“A”) if— (a) a sum arises to— (i) a company connected with A, or (ii) a person not connected with A, (b) any of the enjoyment conditions is met, and (c) the sum does not arise to A apart from this section. (2) The enjoyment conditions are— (a) the sum, or part of the sum, is in fact so dealt with by any person as to be calculated at some time to enure for the benefit of A or a person connected with A; (b) the arising of the sum operates to increase the value to A or a person connected with A of any assets which— (i) A or the connected person holds, or (ii) are held for the benefit of A or the connected person; (c) A or a person connected with A receives or is entitled to receive at any time any benefit provided or to be provided out of the sum or part of the sum; (d) A or a person connected with A may become entitled to the beneficial enjoyment of the sum or part of the sum if one or more powers are exercised or successively exercised (and for these purposes it does not matter who may exercise the powers or whether they are exercisable with or without the consent of another person); (e) A or a person connected with A is able in any manner to control directly or indirectly the application of the sum or part of the sum. In this subsection, in a case where the sum referred to in subsection (1)(a) arises to a company connected with A, references to a person connected with A do not include that company. (3) There arises to A for the purposes of this Chapter— (a) the sum referred to in subsection (1)(a), or (b) if the enjoyment condition in subsection (2)(a), (c), (d) or (e) is met in relation to part of the sum, that part of that sum, or (c) if the enjoyment condition in subsection (2)(b) is met, such part of that sum as is equal to the amount by which the value of the assets referred to in that condition is increased. (4) Where a sum (or part of a sum) arises to A by virtue of this section, it arises to A at the time it arises to the person referred to in subsection (1)(a)(i) or (ii) (whether the enjoyment condition was met at that time or at a later date). (5) In determining whether any of the enjoyment conditions is met in relation to a sum or part of a sum— (a) regard must be had to the substantial result and effect of all the relevant circumstances, and (b) all benefits which may at any time accrue to a person as a result of the sum arising as specified in subsection (1)(a) must be taken into account, irrespective of— (i) the nature or form of the benefits, or (ii) whether the person has legal or equitable rights in respect of the benefits. (6) The enjoyment condition in subsection (2)(b), (c) or (d) is to be treated as not met if it would be met only by reason of A holding shares or an interest in shares in a company. (7) The enjoyment condition in subsection (2)(a) or (e) is to be treated as not met if the sum referred to in subsection (1)(a) arises to a company connected with A and— (a) the company is liable to pay corporation tax in respect of its profits and the sum is included in the computation of those profits, or (b) paragraph (a) does not apply but— (i) the company is a CFC and the exemption in Chapter 14 of Part 9A of TIOPA 2010 applies for the accounting period in which the sum arises, or (ii) the company is not a CFC but, if it were, that exemption would apply for that period. In this subsection “CFC” has the same meaning as in Part 9A of TIOPA 2010. (8) But subsections (6) and (7) do not apply if the sum referred to in subsection (1)(a) arises to the company referred to in subsection (1)(a)(i) or the person referred to in subsection (1)(a)(ii) as part of arrangements where— (a) it is reasonable to assume that in the absence of the arrangements the sum or part of the sum would have arisen to A or an individual connected with A, and (b) it is reasonable to assume that the arrangements have as their main purpose, or one of their main purposes, the avoidance of a liability to pay income tax, capital gains tax, inheritance tax or corporation tax. (9) The condition in subsection (8)(b) is to be regarded as met in a case where the sum is applied directly or indirectly as an investment in a collective investment scheme. (10) Section 993 (meaning of “connected”) applies for the purposes of this section, but as if— (a) subsection (4) of that section were omitted, and (b) partners in a partnership in which A is also a partner were not “associates” of A for the purposes of sections 450 and 451 of CTA 2010 (“control”).

• (2) In ITA 2007, in section 809EZA(3)(c), omit “directly or indirectly”.

• (3) The amendments made by this section have effect in relation to—

• (a) sums other than carried interest arising on or after 22 October 2015, (whenever the arrangements under which the sums arise were made), and

• (b) carried interest arising on or after 22 October 2015 under any arrangements, ....

• (4) In subsection (3), “arise”, “arrangements” and “carried interest” have the same meanings as in Chapter 5E of Part 13 of ITA 2007.

PART 5 — Excise duties and other taxes

Vehicle excise duty

Vehicle excise duty

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• (1) VERA 1994 is amended as follows.

• (2) In Schedule 1 (annual rates of duty)—

• (a) in the heading to Part 1A (light passenger vehicles: graduated rates of duty) after “VEHICLES” insert “ REGISTERED BEFORE 1 APRIL 2017 ”;

• (b) in paragraph 1A (vehicles to which Part 1A applies) in sub-paragraph (1)(a) for “on or after 1 March 2001” substitute “ , after 28 February 2001 but before 1 April 2017 ”;

• (c) after Part 1A insert—

(1GA) (1) This Part of this Schedule applies to a vehicle which— (a) is first registered, under this Act or under the law of a country or territory outside the United Kingdom, on or after 1 April 2017, and (b) is so registered on the basis of an EU certificate of conformity or UK approval certificate that— (i) identifies the vehicle as having been approved as a light passenger vehicle, and (ii) specifies a CO₂ emissions figure in terms of grams per kilometre driven. (2) In sub-paragraph (1)(b)(i) a “light passenger vehicle” has the meaning given by paragraph 1A(2). (3) The following provisions of Part 1A of this Schedule apply for the purposes of this Part of this Schedule as they apply for the purposes of that Part— (a) paragraph 1A(3) and (4) (meaning of “the applicable CO₂ emissions figure”); (b) paragraph 1A(5) (effect of subsequent modifications); (c) paragraphs 1C and 1D (the reduced rate and the standard rate); (d) paragraph 1G (meaning of “EU certificate of conformity” and “UK approval certificate”). (1GB) (1) No vehicle excise duty shall be paid on the first vehicle licence for a vehicle to which this Part of this Schedule applies if the vehicle is within sub-paragraph (2) or (3). (2) A vehicle is within this sub-paragraph if— (a) its applicable CO₂ emissions figure is 0 g/km, and (b) it is not an exempt vehicle by reason of paragraph 25(4) of Schedule 2 (because of sub-paragraph (5) of that paragraph). (3) A vehicle is within this sub-paragraph if— (a) its applicable CO₂ emissions figure exceeds 0 g/km but does not exceed 50 g/km, and (b) condition A, B or C in paragraph 1C is met. (1GC) For the purpose of determining the rate at which vehicle excise duty is to be paid on the first vehicle licence for a vehicle to which this Part of this Schedule applies, the annual rate of duty applicable to the vehicle shall be determined in accordance with the following table by reference to— (a) the applicable CO₂ emissions figure, and (b) whether the vehicle qualifies for the reduced rate of duty or is liable to the standard rate of duty.

CO₂ emissions figure	CO₂ emissions figure	Rate	Rate
(1)	(2)	(3)	(4)
Exceeding g/km	Not exceeding g/km	Reduced rate	Standard rate
0	50		10
50	75	15	25
75	90	90	100
90	100	110	120
100	110	130	140
110	130	150	160
130	150	190	200
150	170	490	500
170	190	790	800
190	225	1190	1200
225	255	1690	1700
255		1990	2000

(1GD) (1) For the purpose of determining the rate at which vehicle excise duty is to be paid on any other vehicle licence for a vehicle to which this Part of this Schedule applies, the annual rate of vehicle excise applicable to the vehicle is— (a) the reduced rate of £130, if the vehicle qualifies for the reduced rate, or (b) the standard rate of £140, if the vehicle is liable to the standard rate. (2) But sub-paragraph (1) does not apply where paragraph 1GE(2) or (4) applies. (1GE) (1) Sub-paragraph (2) applies for the purpose of determining the rate at which vehicle excise duty is to be paid on any other vehicle licence for a vehicle to which this Part applies if— (a) the price of the vehicle exceeds £40,000, (b) the vehicle was first registered, under this Act or under the law of a country or territory outside the United Kingdom, less than six years before the date on which the licence has effect, and (c) the vehicle's applicable CO₂ emissions figure exceeds 0 g/km. (2) The annual rate of vehicle excise duty applicable to the vehicle is— (a) £440, if the vehicle qualifies for the reduced rate, or (b) £450, if the vehicle is liable to the standard rate. (3) Sub-paragraph (4) applies for the purpose of determining the rate at which vehicle excise duty is to be paid on any other vehicle licence for a vehicle to which this Part applies if— (a) the price of the vehicle exceeds £40,000; (b) the vehicle was first registered, under this Act or under the law of a country or territory outside the United Kingdom, less than six years before the date on which the licence has effect, and (c) the vehicle's applicable CO₂ emissions figure is 0 g/km. (4) The annual rate of vehicle excise duty applicable to the vehicle is £310. (1GF) (1) For the purposes of paragraph 1GE(1)(a) and (3)(a) the price of a vehicle is— (a) in a case where the vehicle has a list price, the sum of— (i) that price, and (ii) the price of any non-standard accessory which is attached to the vehicle when it is first registered under this Act, or (b) in a case where the vehicle does not have a list price, its notional price. (2) The reference in sub-paragraph (1)(a)(ii) to the price of a non-standard accessory is to— (a) its list price, if it has one, or (b) its notional price, if it has no list price. (3) Sections 123, 124, 125 and 127 to 130 of the Income Tax (Earnings and Pensions) Act 2003 apply for the purpose of defining terms used in this paragraph as they apply for the purpose of defining terms used in Chapter 6 of Part 3 of that Act, but with the modifications specified in sub-paragraph (4). (4) The modifications are as follows— (a) references to a car are to be read as references to a vehicle; (b) references to relevant taxes are to be read as not including references to vehicle excise duty; (c) in section 124(1)(f) for the words from “qualifying” to the end substitute “ accessories attached to the vehicle when it was first registered under VERA 1994 ”; (d) in section 125 omit subsection (1) and (2)(a); (e) in section 127— (i) in subsection (1) omit “initial extra”; (ii) omit subsection (2).

• (3) In Schedule 2 (exempt vehicles)—

• (a) in paragraph 20G (electrically propelled vehicles)—

• (i) the existing provision becomes sub-paragraph (1);

• (ii) after that sub-paragraph insert—

(2) But a vehicle is not an exempt vehicle by reason of this paragraph if— (a) it is a vehicle to which Part 1AA of Schedule 1 applies (light passenger vehicles registered on or after 1 April 2017), and (b) its price exceeds £40,000. (3) Paragraph 1GF of Schedule 1 (calculating the price of a vehicle) applies for the purposes of sub-paragraph (2)(b).

;

• (b) in paragraph 25 (light passenger vehicles with low CO₂ emissions) after sub-paragraph (3) insert—

(4) A vehicle is an exempt vehicle if— (a) it is a vehicle to which Part 1AA of Schedule 1 applies, and (b) it has an applicable CO₂ emissions figure (as defined in paragraph 1A(3) and (4) of that Schedule) of 0 g/km. (5) But a vehicle is not an exempt vehicle by reason of sub-paragraph (4) if— (a) its price exceeds £40,000, and (b) less than six years have passed since it was first registered (whether under this Act or under the law of a country or territory outside the United Kingdom). (6) Paragraph 1GF of Schedule 1 (calculating the price of a vehicle) applies for the purposes of sub-paragraph (5)(a).

Insurance premium tax

Insurance premium tax: standard rate

47

• (1) In section 51(2)(b) of FA 1994 (standard rate of insurance premium tax), for “6 per cent” substitute “ 9.5 per cent ”.

• (2) The amendment made by subsection (1) has effect in relation to a premium falling to be regarded for the purposes of Part 3 of FA 1994 as received under a taxable insurance contract by an insurer on or after 1 November 2015.

• (3) The amendment made by subsection (1) does not have effect in relation to a premium which—

• (a) is in respect of a contract made before 1 November 2015, and

• (b) falls to be regarded for the purposes of Part 3 of FA 1994 as received under the contract by the insurer before 1 March 2016 by virtue of regulations under section 68 of that Act (special accounting schemes).

• (4) Subsection (3) does not apply in relation to a premium which—

• (a) is an additional premium under a contract,

• (b) falls to be regarded for the purposes of Part 3 of FA 1994 as received under the contract by the insurer on or after 1 November 2015 by virtue of regulations under section 68 of that Act, and

• (c) is in respect of a risk which was not covered by the contract before that date.

• (5) In the application of sections 67A to 67C of FA 1994 (announced increase in rate) in relation to the increase made by this section—

• (a) the announcement for the purposes of sections 67A(1) and 67B(1) is to be taken to have been made on 8 July 2015,

• (b) the date of the change is 1 November 2015, and

• (c) the concessionary date is 1 March 2016.

Aggregates levy

Aggregates levy: restoration of exemptions

48

• (1) The provisions of Part 2 of FA 2001 (aggregates levy) that were amended or repealed by section 94 of FA 2014 (removal of certain exemptions with effect from 1 April 2014) have effect, and are to be treated as having had effect at all times on or after 1 April 2014, as if the amendments and repeals made by that section had not been made.

• (2) Accordingly, sections 94 and 95 of FA 2014 are repealed.

• (3) Part 2 of FA 2001, as amended by subsection (1), is further amended in accordance with subsections (4) and (5).

• (4) In section 17 (meaning of “aggregate” and “taxable aggregate”), in each of subsections (3)(f) and (4)(a)—

• (a) after “lignite,” insert “ or ”, and

• (b) omit “or shale”.

• (5) In section 18(2) (meaning of “exempt process”), after paragraph (c) insert—

(ca) in the case of aggregate consisting of shale, any process consisting of a use of the shale that— (i) is not a use of it as material or support in the construction or improvement of any structure, and (ii) is not mixing it with anything as part of the process of producing mortar, concrete, tarmacadam, coated roadstone or any similar construction material.

• (6) The repeal of section 94 of FA 2014 is to be treated as having come into force on 1 August 2015, and the amendments made by subsections (3) to (5) are to be treated as having come into force on 1 April 2014.

Climate change levy

CCL: removal of exemption for electricity from renewable sources

49

In paragraph 19 of Schedule 6 to FA 2000 (climate change levy: exemption for electricity from renewable sources), in sub-paragraph (3), before paragraph (a) insert—

(za) it is generated before 1 August 2015,

.

PART 6 — Administration and enforcement

International agreements to improve compliance: client notification

50

• (1) Section 222 of FA 2013 (international agreements to improve tax compliance) is amended as follows.

• (2) In subsection (2), in paragraph (c), after “purposes” (but before the closing bracket) insert “ and client notification obligations ”.

• (3) In subsection (2), after paragraph (c) insert—

(ca) impose client notification obligations on specified relevant persons;

.

• (4) After subsection (2) insert—

(2A) For the purposes of subsection (2)(c) and (ca) a “client notification obligation” is an obligation to give specified information to— (a) clients, or (b) specified clients. (2B) In subsection (2A) the reference to an obligation to give specified information includes— (a) any obligation to give the information— (i) in a specified form or manner; (ii) at a specified time or specified times; (b) in the case of a relevant financial entity or relevant person which is a body corporate, an obligation to require a person of which it has control to give the information.

• (5) In subsection (4), at the appropriate places insert—

“client” includes— (a) any client or customer, and (b) any former client or customer;

;

“control” is to be construed in accordance with section 1124 of CTA 2010;

;

“relevant person” means— (a) a tax adviser (as defined by section 272(5) of FA 2014), and (b) any other person who in the course of business— (i) gives advice to another person about that person's financial or legal affairs, or (ii) provides other financial or legal services to another person;

.

Enforcement by deduction from accounts

51

• (1) Schedule 8 contains provision about the enforcement of debts owed to the Commissioners for Her Majesty's Revenue and Customs by making deductions from accounts held with deposit-takers.

• (2) The Treasury may, by regulations made by statutory instrument, make consequential, incidental or supplementary provision in connection with any provision made by that Schedule.

• (3) Regulations under subsection (2) may amend, repeal or revoke any enactment (whenever passed or made).

• (4) “Enactment” includes an enactment contained in subordinate legislation within the meaning of the Interpretation Act 1978.

• (5) A statutory instrument containing (whether alone or with other provision) provision amending or repealing an Act may not be made unless a draft of the instrument has been laid before and approved by a resolution of the House of Commons.

• (6) Any other statutory instrument containing regulations under subsection (2) is subject to annulment in pursuance of a resolution of the House of Commons.

Rate of interest applicable to judgment debts etc in taxation matters

52

• (1) This section applies if a sum payable to or by the Commissioners under a judgment or order given or made in any court proceedings relating to a taxation matter (a “tax-related judgment debt”) carries interest as a result of a relevant enactment.

• (2) The “relevant enactments” are—

• (a) section 17 of the Judgments Act 1838 (judgment debts to carry interest), and

• (b) any order under section 74 of the County Courts Act 1984 (interest on judgment debts etc).

• (3) The relevant enactment is to have effect in relation to the tax-related judgment debt as if for the rate specified in section 17(1) of the Judgments Act 1838 and any other rate specified in an order under section 74 of the County Courts Act 1984 there were substituted—

• (a) in the case of a sum payable to the Commissioners, the late payment interest rate provided for in regulations made by the Treasury under section 103(1) of FA 2009, and

• (b) in the case of a sum payable by the Commissioners, the special repayment rate.

• (4) Subsection (3) does not affect any power of the court under the relevant enactment to prevent any sum from carrying interest or to provide for a rate of interest which is lower than (and incapable of exceeding) that for which the subsection provides.

• (5) If section 44A of the Administration of Justice Act 1970 (interest on judgment debts expressed otherwise than in sterling), or any corresponding provision made under section 74 of the County Courts Act 1984 in relation to the county court, applies to a tax-related judgment debt—

• (a) subsection (3) does not apply, but

• (b) the court may not specify in an order under section 44A of the Administration of Justice Act 1970, or under any provision corresponding to that section which has effect under section 74 of the County Courts Act 1984, an interest rate which exceeds (or is capable of exceeding)—

• (i) in the case of a sum payable to the Commissioners, the rate mentioned in subsection (3)(a), or

• (ii) in the case of a sum payable by the Commissioners, the special repayment rate.

• (6) The “special repayment rate” is the percentage per annum given by the formula—

$$B R + 2$where BR is the official Bank rate determined by the Bank of England Monetary Policy Committee at the operative meeting.$

• (7) “The operative meeting”, in relation to the special repayment rate applicable in respect of any day, means the most recent meeting of the Bank of England Monetary Policy Committee apart from any meeting later than the 13th working day before that day.

• (8) The Treasury may by regulations made by statutory instrument—

• (a) repeal subsections (6) and (7), and

• (b) provide that the “special repayment rate” for the purposes of this section is the rate provided for in the regulations.

• (9) Regulations under subsection (8)—

• (a) may make different provision for different purposes,

• (b) may either themselves specify a rate of interest or make provision for such a rate to be determined (and to change from time to time) by reference to such rate, or the average of such rates, as may be referred to in the regulations,

• (c) may provide for rates to be reduced below, or increased above, what they would otherwise be by specified amounts or by reference to specified formulae,

• (d) may provide for rates arrived at by reference to averages to be rounded up or down,

• (e) may provide for circumstances in which the alteration of a rate of interest is or is not to take place, and

• (f) may provide that alterations of rates are to have effect for periods beginning on or after a day determined in accordance with the regulations (“the effective date”) regardless of—

• (i) the date of the judgment or order in question, and

• (ii) whether interest begins to run on or after the effective date, or began to run before that date.

• (10) A statutory instrument containing regulations under subsection (8) is subject to annulment in pursuance of a resolution of the House of Commons.

• (11) To the extent that a tax-related judgment debt consists of an award of costs to or against the Commissioners, the reference in section 24(2) of the Crown Proceedings Act 1947 (which relates to interest on costs awarded to or against the Crown) to the rate at which interest is payable upon judgment debts due from or to the Crown is to be read as a reference to the rate at which interest is payable upon tax-related judgment debts.

• (12) This section has effect in relation to interest for periods beginning on or after 8 July 2015, regardless of—

• (a) the date of the judgment or order in question, and

• (b) whether interest begins to run on or after 8 July 2015, or began to run before that date.

• (13) Subsection (14) applies where, at any time during the period beginning with 8 July 2015 and ending immediately before the day on which this Act is passed (“the relevant period”)—

• (a) a payment is made in satisfaction of a tax-related judgment debt, and

• (b) the payment includes interest under a relevant enactment in respect of any part of the relevant period.

• (14) The court by which the judgment or order in question was given or made must, on an application made to it under this subsection by the person who made the payment, order the repayment of the amount by which the interest paid under the relevant enactment in respect of days falling within the relevant period exceeds the interest payable under the relevant enactment in respect of those days in accordance with the provisions of this section.

• (15) In this section—

• “the Commissioners” means the Commissioners for Her Majesty's Revenue and Customs;

• “taxation matter” means anything... the collection and management of which is the responsibility of the Commissioners (or was the responsibility of the Commissioners of Inland Revenue or Commissioners of Customs and Excise);

• “working day” means any day other than a non-business day as defined in section 92 of the Bills of Exchange Act 1882.

• (16) This section extends to England and Wales only.

PART 7 — Final

Interpretation

53

In this Act—

• “CAA 2001” means the Capital Allowances Act 2001,

• “CTA 2009” means the Corporation Tax Act 2009,

• “CTA 2010” means the Corporation Tax Act 2010,

• “FA”, followed by a year, means the Finance Act of that year,

• “IHTA 1984” means the Inheritance Tax Act 1984,

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

• “ITEPA 2003” means the Income Tax (Earnings and Pensions) Act 2003,

• “ITTOIA 2005” means the Income Tax (Trading and Other Income) Act 2005,

• “TCGA 1992” means the Taxation of Chargeable Gains Act 1992,

• “TIOPA 2010” means the Taxation (International and Other Provisions) Act 2010,

• “TMA 1970” means the Taxes Management Act 1970,

• “VATA 1994” means the Value Added Tax Act 1994, and

• “VERA 1994” means the Vehicle Excise and Registration Act 1994.

Short title

54

This Act may be cited as the Finance (No. 2) Act 2015.

SCHEDULE 1

1

IHTA 1984 is amended as follows.

2

After section 62 insert—

(62A) (1) For the purposes of this Chapter, there is a “same-day addition”, in relation to a settlement (“settlement A”), if— (a) there is a transfer of value by a person as a result of which the value immediately afterwards of the property comprised in settlement A is greater than the value immediately before, (b) as a result of the same transfer of value, or as a result of another transfer of value made by that person on the same day, the value immediately afterwards of the property comprised in another settlement (“settlement B”) is greater than the value immediately before, (c) that person is the settlor of settlement A and settlement B, (d) at any point in the relevant period, all or any part of the property comprised in settlement A was relevant property, and (e) at that point, or at any other point in the relevant period, all or any part of the property comprised in settlement B was relevant property. For exceptions, see section 62B. (2) Where there is a same-day addition, references in this Chapter to its value are to the difference between the two values mentioned in subsection (1)(b). (3) “The relevant period” means— (a) in the case of settlement A, the period beginning with the commencement of settlement A and ending immediately after the transfer of value mentioned in subsection (1)(a), and (b) in the case of settlement B, the period beginning with the commencement of settlement B and ending immediately after the transfer of value mentioned in subsection (1)(b)). (4) The transfer or transfers of value mentioned in subsection (1) include a transfer or transfers of value as a result of which property first becomes comprised in settlement A or settlement B; but not if settlements A and B are related settlements. (5) For the purposes of subsection (1) above, it is immaterial whether the amount of the property comprised in settlement A or settlement B (or neither) was increased as a result of the transfer or transfers of value mentioned in that subsection. (62B) (1) There is not a same-day addition for the purposes of this Chapter if any of the following conditions is met— (a) immediately after the transfer of value mentioned in section 62A(1)(a) all the property comprised in settlement A was held for charitable purposes only without limit of time (defined by a date or otherwise), (b) immediately after the transfer of value mentioned in section 62A(1)(b) all the property comprised in settlement B was so held, (c) either or each of settlement A and settlement B is a protected settlement (see section 62C), and (d) the transfer of value, or either or each of the transfers of value, mentioned in section 62A(1)(a) and (b)— (i) results from the payment of a premium under a contract of life insurance the terms of which provide for premiums to be due at regular intervals of one year or less throughout the contract term, or (ii) is made to fund such a payment. (2) If the transfer of value, or each of the transfers of value, mentioned in section 62A(1) is not the transfer of value under section 4 on the settlor's death, there is a same-day addition for the purposes of this Chapter only if conditions A and B are met. (3) Condition A is that— (a) the difference between the two values mentioned in section 62A(1)(a) exceeds £5,000, or (b) in a case where there has been more than one transfer of value within section 62A(1)(a) on the same day, the difference between— (i) the value of the property comprised in settlement A immediately before the first of those transfers, and (ii) the value of the property comprised in settlement A immediately after the last of those transfers, exceeds £5,000. (4) Condition B is that— (a) the difference between the two values mentioned in section 62A(1)(b) exceeds £5,000, or (b) in a case where there has been more than one transfer of value within section 62A(1)(b), the difference between— (i) the value of the property comprised in settlement B immediately before the first of those transfers, and (ii) the value of the property comprised in settlement B immediately after the last of those transfers, exceeds £5,000. (62C) (1) For the purposes of this Chapter, a settlement is a “protected settlement” if it commenced before 10 December 2014 and either condition A or condition B is met. (2) Condition A is met if there have been no transfers of value by the settlor on or after 10 December 2014 as a result of which the value of the property comprised in the settlement was increased. (3) Condition B is met if— (a) there has been a transfer of value by the settlor on or after 10 December 2014 as a result of which the value of the property comprised in the settlement was increased, and (b) that transfer of value was the transfer of value under section 4 on the settlor's death before 6 April 2017 and it had the result mentioned by reason of a protected testamentary disposition. (4) In subsection (3)(b) “protected testamentary disposition” means a disposition effected by provisions of the settlor's will that at the settlor's death are, in substance, the same as they were immediately before 10 December 2014.

3

• (1) Section 66 (rate of ten-yearly charge) is amended as follows.

• (2) In subsection (4)—

• (a) omit paragraph (b) and the “and” following it,

• (b) in paragraph (c), before “property” insert “ relevant ”, and

• (c) at the end of paragraph (c) insert—

(d) the value of any same-day addition; and (e) where— (i) an increase in the value of the property comprised in another settlement is represented by the value of a same-day addition aggregated under paragraph (d) above, and (ii) that other settlement is not a related settlement, the value immediately after that other settlement commenced of the relevant property then comprised in that other settlement;

.

• (3) In subsection (6)(a), for “paragraphs (b) and (c)” substitute “ paragraphs (c) to (e) ”.

4

In section 68 (rate before ten-year anniversary), in subsection (5)—

• (a) in paragraphs (a) and (b), before “property” insert “ relevant ”,

• (b) omit the “and” following paragraph (b), and

• (c) for paragraph (c) substitute—

(c) the value, immediately after it became comprised in the settlement, of property which— (i) became comprised in the settlement after the settlement commenced and before the occasion of the charge under section 65 above, and (ii) was relevant property immediately after it became so comprised, whether or not the property has remained relevant property comprised in the settlement; (d) the value, at the time it became (or last became) relevant property, of property which— (i) was comprised in the settlement immediately after the settlement commenced and was not then relevant property but became relevant property before the occasion of the charge under section 65 above, or (ii) became comprised in the settlement after the settlement commenced and before the occasion of the charge under section 65 above, and was not relevant property immediately after it became comprised in the settlement, but became relevant property before the occasion of the charge under that section, whether or not the property has remained relevant property comprised in the settlement; (e) the value of any same-day addition; and (f) where— (i) an increase in the value of the property comprised in another settlement is represented by the value of a same-day addition aggregated under paragraph (e) above, and (ii) that other settlement is not a related settlement, the value immediately after that other settlement commenced of the relevant property then comprised in that other settlement.

5

• (1) Section 69 (rate between ten-year anniversaries) is amended as follows.

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

• (3) For subsection (2) substitute—

(2) Subsection (2A) below applies— (a) if, at any time in the period beginning with the most recent ten-year anniversary and ending immediately before the occasion of the charge under section 65 above (the “relevant period”), property has become comprised in the settlement which was relevant property immediately after it became so comprised, or (b) if— (i) at any time in the relevant period, property has become comprised in the settlement which was not relevant property immediately after it became so comprised, and (ii) at a later time in the relevant period, that property has become relevant property, or (c) if property which was comprised in the settlement immediately before the relevant period, but was not then relevant property, has at any time during the relevant period become relevant property. (2A) Whether or not all of the property within any of paragraphs (a) to (c) of subsection (2) above has remained relevant property comprised in the settlement, the rate at which tax is charged under section 65 is to be the appropriate fraction of the rate at which it would last have been charged under section 64 above (apart from section 66(2) above) if— (a) immediately before the most recent ten-year anniversary, all of that property had been relevant property comprised in the settlement with a value determined in accordance with subsection (3) below, and (b) any same-day addition made on or after the most recent ten-year anniversary had been made immediately before that anniversary.

• (4) In subsection (3)—

• (a) omit the words from “which either” to the end of paragraph (b), and

• (b) for “purposes of subsection (2)” substitute “ purposes of subsection (2A) ”.

6

In section 71F (calculation of settlement rate in order to calculate the tax charged under section 71E), in subsection (9)(b), after “in it” insert “ which was property to which section 71D above applied ”.

7

The amendments made by this Schedule have effect in relation to occasions on which tax falls to be charged under Chapter 3 of Part 3 of IHTA 1984 on or after the day on which this Act is passed.

SCHEDULE 2

Bank levy rate for 2016

1

• (1) In paragraph 6 of Schedule 19 to FA 2011 (steps for determining the amount of the bank levy), in sub-paragraph (2)—

• (a) for “0.105%” substitute “ 0.09% ”, and

• (b) for “0.21%” substitute “ 0.18% ”.

• (2) In paragraph 7 of that Schedule (special provision for chargeable periods falling wholly or partly before 1 April 2015)—

• (a) in sub-paragraph (1) for “1 April 2015” substitute “ 1 January 2016 ”;

• (b) in sub-paragraph (2), in the first column of the table in the substituted Step 7, for “ Any time on or after 1 April 2015 ” substitute “1 April 2015 to 31 December 2015”;

• (c) at the end of that table add—

1 January 2016 to 31 December 2016	0.09%	0.18%

• (d) in the italic heading before paragraph 7, for “1 April 2015” substitute “ 1 January 2016 ”.

• (3) The amendments made by sub-paragraphs (1) and (2) come into force on 1 January 2016.

• (4) Sub-paragraphs (5) to (10) 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 begins before but ends on or after 1 January 2016, 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 1 January 2016 (“pre-commencement instalment payments”).

• (5) Sub-paragraphs (1) to (3) are to be ignored for the purpose of determining the amount of any pre-commencement instalment payment.

• (6) 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 1 January 2016, the amount of that instalment payment, or the first of them, is to be reduced by the adjustment amount.

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

• (a) the aggregate amount of the pre-commencement instalment payments determined in accordance with sub-paragraph (5), and

• (b) the aggregate amount of those instalment payments determined ignoring sub-paragraph (5) (and so taking account of sub-paragraphs (1) to (3)).

• (8) 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 sub-paragraphs (4) to (7) (and in regulation 8(2) “that regulation” is to be read accordingly), and

• (b) in regulation 9(3), the reference to those Regulations is to be read as including a reference to sub-paragraphs (4) to (7).

• (9) 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 sub-paragraphs (4) to (8).

• (10) In this paragraph—

• “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 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 rate for 2017

2

• (1) In paragraph 6 of Schedule 19 to FA 2011 (steps for determining the amount of the bank levy), in sub-paragraph (2)—

• (a) for “0.09%” substitute “ 0.085% ”, and

• (b) for “0.18%” substitute “ 0.17% ”.

• (2) In paragraph 7 of that Schedule (special provision for chargeable periods falling wholly or partly before 1 January 2016)—

• (a) in sub-paragraph (1) for “2016” substitute “ 2017 ”;

• (b) at the end of that table add—

1 January 2017 to 31 December 2017	0.085%	0.17%

• (c) in the italic heading before paragraph 7, for “2016” substitute “ 2017 ”.

• (3) The amendments made by this paragraph come into force on 1 January 2017.

Bank levy rate for 2018

3

• (1) In paragraph 6 of Schedule 19 to FA 2011 (steps for determining the amount of the bank levy), in sub-paragraph (2)—

• (a) for “0.085%” substitute “ 0.08% ”, and

• (b) for “0.17%” substitute “ 0.16% ”.

• (2) In paragraph 7 of that Schedule (special provision for chargeable periods falling wholly or partly before 1 January 2017)—

• (a) in sub-paragraph (1) for “2017” substitute “ 2018 ”;

• (b) at the end of that table add—

1 January 2018 to 31 December 2018	0.08%	0.16%

• (c) in the italic heading before paragraph 7, for “2017” substitute “ 2018 ”.

• (3) The amendments made by this paragraph come into force on 1 January 2018.

Bank levy rate for 2019

4

• (1) In paragraph 6 of Schedule 19 to FA 2011 (steps for determining the amount of the bank levy), in sub-paragraph (2)—

• (a) for “0.08%” substitute “ 0.075% ”, and

• (b) for “0.16%” substitute “ 0.15% ”.

• (2) In paragraph 7 of that Schedule (special provision for chargeable periods falling wholly or partly before 1 January 2018)—

• (a) in sub-paragraph (1) for “2018” substitute “ 2019 ”;

• (b) at the end of that table add—

1 January 2019 to 31 December 2019	0.075%	0.15%

• (c) in the italic heading before paragraph 7, for “2018” substitute “ 2019 ”.

• (3) The amendments made by this paragraph come into force on 1 January 2019.

Bank levy rate for 2020

5

• (1) In paragraph 6 of Schedule 19 to FA 2011 (steps for determining the amount of the bank levy), in sub-paragraph (2)—

• (a) for “0.075%” substitute “ 0.07% ”, and

• (b) for “0.15%” substitute “ 0.14% ”.

• (2) In paragraph 7 of that Schedule (special provision for chargeable periods falling wholly or partly before 1 January 2019)—

• (a) in sub-paragraph (1) for “2019” substitute “ 2020 ”;

• (b) at the end of that table add—

1 January 2020 to 31 December 2020	0.07%	0.14%

• (c) in the italic heading before paragraph 7, for “2019” substitute “ 2020 ”.

• (3) The amendments made by this paragraph come into force on 1 January 2020.

Bank levy rate for 2021

6

• (1) In paragraph 6 of Schedule 19 to FA 2011 (steps for determining the amount of the bank levy), in sub-paragraph (2)—

• (a) for “0.07%” substitute “ 0.05% ”, and

• (b) for “0.14%” substitute “ 0.1% ”.

• (2) In paragraph 7 of that Schedule (special provision for chargeable periods falling wholly or partly before 1 January 2020)—

• (a) in sub-paragraph (1) for “2020” substitute “ 2021 ”;

• (b) at the end of that table add—

Any time on or after 1 January 2021	0.05%	0.1%

• (c) in the italic heading before paragraph 7, for “2020” substitute “ 2021 ”.

• (3) The amendments made by this paragraph come into force on 1 January 2021.

SCHEDULE 3

PART 1 — Main provisions

1

In Part 7A of CTA 2010 (banking companies), after Chapter 3 insert—