Legalize / United Kingdom / Public General Act

Finance Act 2020

Type Public General Act

Publication 2020-07-22

Last updated 2026-03-18

State In force

Department Statute Law Database

Source legislation.gov.uk

articles Not indexed

Reform history JSON API

(4A) Section 269DCA defines “non-banking transferred-in loss relief” for the purposes of calculating a company's surcharge profits.

(3) In section 269DA (surcharge on banking companies), in subsection (2) (calculation of “surcharge profits”)—

(a) in the formula, after “NBPLR +” insert “ NBTILR + ”;

(b) after the definition of “NBPLR” insert—

“NBTILR” is the amount (if any) of non-banking transferred-in loss relief (see section 269DCA);

(4) In section 269DC (meaning of “non-banking or pre-2016 loss relief”)—

(a) in subsection (13) (meaning of “a non-banking or pre-2016 carried-forward capital loss”)—

(i) in paragraph (a), omit “or as a result of a non-banking loss transfer”;

(ii) in paragraph (b), for “8(1)(b)” substitute “ 2A(1)(b) ”;

(b) omit subsections (14) and (15) (meaning of “non-banking loss transfer” and “non-banking company”).

(5) After section 269DC insert—

(269DCA) (1) In section 269DA(2), “non-banking transferred-in loss relief” means the sum of any amounts that are deducted under section 2A of TCGA 1992 in determining the taxable total profits of the company of the chargeable accounting period in respect of an allowable loss, or any part of an allowable loss, that accrued to the company as a result of a non-banking loss transfer. (2) A “non-banking loss transfer” is a transfer to the company of the whole or any part of an allowable loss, by an election under section 171A of TCGA 1992 (reallocation within group), from a non-banking company. (3) In this section “non-banking company” means a company that is not a banking company at the time that the allowable loss, or such part of it as the election transfers, is treated as accruing by virtue of the election (see, in particular, section 171B(3) of TCGA 1992).

(6) The amendments made by this section have effect in relation to an allowable loss, or any part of an allowable loss, deducted from a chargeable gain accruing on a disposal made on or after 11 March 2020.

CT payment plans for tax on certain transactions with EEA residents

34

Schedule 7 makes provision for the deferral of the payment of corporation tax arising in connection with certain transactions involving companies resident in an EEA state.

Changes to accounting standards affecting leases

35

(1) Schedule 14 to FA 2019 (leases: changes to accounting standards etc) is amended as follows.

(2) In paragraph 13 (cases where asset first recognised for period of account beginning on or after 1 January 2019), for sub-paragraph (1) substitute—

(1) This paragraph applies if the first period of account for which the right-of-use asset falls (or would fall) to be recognised for accounting purposes in the accounts of the lessee begins on or after 1 January 2019 (referred to in the following provisions of this paragraph as “the first period of account”).

(3) For paragraph 14 (cases where asset first recognised for a period of account beginning before 1 January 2019) substitute—

(14) (1) This paragraph applies if the first period of account for which the right-of-use asset falls (or would fall) to be recognised for accounting purposes in the accounts of the lessee begins before 1 January 2019. (2) The change of basis provisions and this Part of this Schedule have effect— (a) as if there were a change of accounting policy with respect of the accounts of the lessee for the first period of account beginning on or after 1 January 2019, and (b) as if that period of account were the first period of account for which the right-of-use asset falls (or would fall) to be recognised for accounting purposes in the accounts of the lessee.

(4) Schedule 14 to FA 2019 has effect, and is to be deemed always to have had effect, with the amendments made by this section.

Investments

Enterprise investment scheme: approved investment fund as nominee

36

(1) Section 251 of ITA 2007 (EIS: approved investment fund as nominee) is amended as follows.

(2) In subsection (1)—

(a) in the opening words, for “Subsection (2) applies” substitute “ This section applies ”,

(b) in paragraph (a), for “an approved fund” substitute “ an approved knowledge-intensive fund ”,

(d) in paragraph (c), for “90%” substitute “ 50% ”,

(e) after that paragraph insert—

(d) the amounts which the managers have, as nominee for the individual, subscribed for shares issued within 24 months after the closing of the fund represent at least 90% of the individual's investment in the fund, (e) within that 24 month period at least 80% of the individual's investment in the fund is represented by shares in companies which are knowledge-intensive companies at the time the shares are issued, and (f) the managers have met such conditions with respect to the provision of information to HMRC Commissioners as the Commissioners consider appropriate for the purposes of this section.

, and

(f) omit the second sentence.

(3) After that subsection insert—

(1A) In this section “the managers of an approved knowledge-intensive fund” means the person or persons having the management of an investment fund— (a) which is, in the opinion of HMRC Commissioners, a fund established for the purpose of investing wholly, or substantially wholly, in shares in companies which are knowledge-intensive companies at the time the shares are issued, and (b) which is, having met such other conditions as HMRC Commissioners consider appropriate for the purposes of this section, approved by them for those purposes.

(4) In subsection (2), omit “In any case where this subsection applies,”.

(5) After that subsection insert—

(2A) Accordingly, in a case where section 158 has effect with the modifications in subsection (2), the reference in section 158(4) to the issue of the shares in the preceding tax year is to the issue of the shares in the tax year preceding the tax year in which the fund closes (and references elsewhere in this Part to the issue of shares in a previous tax year are to be read accordingly).

(6) In subsection (4), in the opening words, for “an approved fund” substitute “ an approved knowledge-intensive fund ”.

(7) In subsection (5)(b), for “the Commissioners for Her Majesty's Revenue and Customs” substitute “ HMRC Commissioners ”.

(8) In subsection (6), for “an approved fund” substitute “ an approved knowledge-intensive fund ”.

(9) In subsection (7), for “an approved fund” substitute “ an approved knowledge-intensive fund ”.

(10) After that subsection insert—

(8) In this section “HMRC Commissioners” means the Commissioners for Her Majesty's Revenue and Customs.

(11) In the title, for “investment fund” substitute “ knowledge-intensive fund ”.

(12) The amendments made by this section are treated as having come into force on 6 April 2020 in relation to funds that close on or after that date.

Gains from contracts for life insurance etc: top slicing relief

37

(1) In Chapter 9 of Part 4 of ITTOIA 2005 (gains from contracts for life insurance etc), sections 535 to 537 (top slicing relief) are amended as follows.

(2) In section 535 (top slicing relief), at the end insert—

(8) For the purposes of the calculations mentioned in subsection (1)— (a) section 25(2) of ITA 2007 (deductions of reliefs and allowances in most beneficial way for taxpayer) does not apply, and (b) reliefs and allowances are available for deduction from an amount that, for the purposes of those calculations, is the highest part of the individual's total income for the tax year only so far as they cannot be deducted from other amounts.

(3) In section 536(1) (top slicing relieved liability: one chargeable event), in paragraph (a) of step 2—

(a) omit the “and” at the end of sub-paragraph (i), and

(b) after the “and” at the end of sub-paragraph (ii) insert—

(iii) in determining the amount of the individual's personal allowance under section 35 of ITA 2007 (but not the amount of any other relief or allowance), it is assumed that the gain from the chargeable event is equal to the amount of the annual equivalent, and

(4) In section 537 (top slicing relieved liability: two or more chargeable events), in paragraph (a) of step 2—

(a) omit the “and” at the end of sub-paragraph (i), and

(b) after the “and” at the end of sub-paragraph (ii) insert—

(iii) in determining the amount of the individual's personal allowance under section 35 of ITA 2007 (but not the amount of any other relief or allowance), it is assumed that the total gains from the chargeable events are equal to the amount of the total annual equivalent, and

(5) The amendments made by this section have effect in relation to the tax year 2019-20 and subsequent tax years (but see subsection (6) for an exception in the case of the tax years 2019-20 and 2020-21).

(6) Those amendments do not have effect in relation to the tax year 2019-20 or 2020-21 in the case of an individual who is only liable to tax under Chapter 9 of Part 4 of ITTOIA 2005 for the year in question—

(a) on a gain from one chargeable event that occurs before 11 March 2020, or

(b) on gains from chargeable events each of which occurs before that day.

Losses on disposal of shares: abolition of requirement to be UK business

38

(1) The following provisions are repealed—

(a) section 134(5) of ITA 2007 (which provides that a company is a qualifying trading company for the purposes of income tax relief under Chapter 6 of Part 4 of that Act only if it carries on its business in the United Kingdom), and

(b) section 78(5) of CTA 2010 (which makes corresponding provision for the purposes of corporation tax relief under Chapter 5 of Part 4 of that Act).

(2) In consequence of the repeals made by subsection (1)—

(a) in ITA 2007—

(i) in section 134(1), for “D” substitute “ C ”,

(ii) in section 147(8), at the end of paragraph (a) insert “ or ” and omit paragraph (c) together with the “or” before it,

(iii) in section 150(1), omit the entry relating to section 134(5)(a), and

(iv) in paragraph 38(2) of Schedule 2, in the opening words, for “(2) to (5)” substitute “ (2) to (4) ”, and omit the substituted section 134(5) of ITA 2007, and

(b) in CTA 2010—

(i) in section 75(8), at the end of paragraph (a) insert “ or ” and omit paragraph (c) together with the “or” before it,

(ii) in section 78(1), for “D” substitute “ C ”,

(iii) in section 89(1), omit the entry relating to section 78(5)(a), and

(iv) in paragraph 28(4) of Schedule 2, in the opening words, for “(2) to (5)” substitute “ (2) to (4) ”, and omit the substituted section 78(5) of CTA 2010.

(3) The amendments made by this section have effect in relation to disposals made on or after 24 January 2019.

PART 2 — Digital services tax

Introduction

Digital services tax: introduction

39

(1) A tax (to be known as “digital services tax”) is charged in accordance with this Part on UK digital services revenues arising to a person in an accounting period.

(2) The Commissioners for Her Majesty's Revenue and Customs (in this Part referred to as “the Commissioners”) are responsible for the collection and management of digital services tax.

(3) In this Part—

(a) sections 40 to 45 define “UK digital services revenues” and other key expressions;

(b) sections 46 to 51 contain the charge to digital services tax;

(d) sections 57 to 60 define groups and related concepts;

(e) sections 61 to 64 define accounting periods, the meaning of revenues arising, and other accounts-related concepts;

(f) sections 65 to 72 contain supplementary and general provisions.

Digital services revenues, UK digital services revenues etc

Meaning of “digital services revenues”

40

(1) This section applies for the purposes of this Part.

(2) The “digital services revenues” of a group for a period are the total amount of revenues arising to members of the group in that period in connection with any digital services activity of any member of the group.

(3) Where revenues arise in connection with a digital services activity and anything else, the revenues are to be treated as arising in connection with the activity to such extent as is just and reasonable.

Meaning of “UK digital services revenues”

41

(1) This section applies for the purposes of this Part.

(2) A group's “UK digital services revenues” for a period are so much of its digital services revenues for that period as are attributable to UK users.

(3) Revenues are attributable to UK users if—

(a) they are within Case 1, 2 or 3, or

(b) they are within Case 4 or 5 and, where subsection (9) applies, they are allocated to UK users under that subsection.

This is subject to subsection (10).

(4) Case 1 is where—

(a) the revenues are online marketplace revenues,

(b) they arise in connection with a marketplace transaction, and

(5) Case 2 is where—

(a) the revenues are online marketplace revenues, and

(b) they arise in connection with particular accommodation or land in the United Kingdom (see section 42).

(6) Case 3 is where—

(a) the revenues are online marketplace revenues,

(b) they arise in connection with online advertising for particular services, goods or other property, and

(7) Case 4 is where—

(a) the revenues are online advertising revenues,

(b) they are not within any of Cases 1 to 3, and

(8) Case 5 is where—

(a) the revenues are not within any of Cases 1 to 4, and

(b) they arise in connection with UK users.

(9) For the purposes of subsection (3)(b), revenues are to be allocated to UK users to such extent as is just and reasonable where they are—

(a) online advertising revenues within Case 4 and the advertising in question is viewed or otherwise consumed by UK users and others;

(b) revenues within Case 5 and they arise in connection with UK users and others.

(10) Online marketplace revenues are treated as not attributable to UK users if—

(a) where they arise in connection with a marketplace transaction—

(i) they arise in connection with particular accommodation or land outside the United Kingdom (see section 42), and

(ii) the only UK user who is a party to the transaction is a provider or seller of the thing to which the transaction relates;

(b) in any other case, they arise in connection with particular accommodation or land outside the United Kingdom (see section 42).

(11) In this section—

“marketplace transaction” means a transaction on the online marketplace between users;

“online advertising revenues” means revenues arising in connection with the provision or facilitation of online advertising;

“online marketplace revenues” means revenues arising in connection with an online marketplace.

(12) For the purpose of the definition of “marketplace transaction”, “transaction on the online marketplace” includes the placing on the marketplace of an order that results in an agreement, even if the agreement between the users is made otherwise than through the marketplace.

UK digital services revenues: accommodation and land

42

(1) This section, which supplements section 41 (meaning of a group's UK digital services revenues), applies for the purpose of determining when online marketplace revenues arise in connection with accommodation or land.

(2) The revenues are treated as arising in connection with accommodation if they arise in connection with—

(a) the provision of accommodation, or

(b) the provision of services, goods or other property in relation to accommodation, in connection with the provision of the accommodation on the online marketplace.

(3) The revenues are treated as arising in connection with land if they arise in connection with—

(a) the sale of an estate, interest or right in or over land, or

(b) the provision of services, goods or other property in relation to land, in connection with the sale of an estate, interest or right in or over the land on the online marketplace.

(4) In this section—

(a) any reference to providing or selling anything includes offering to provide or sell it;

(b) any reference to providing goods or other property includes providing it temporarily;

Meaning of “digital services activity” etc

43

(1) This section applies for the purposes of this Part.

(2) “Digital services activity” means providing—

(a) a social media service,

(b) an internet search engine, or

(3) “Social media service” means an online service that meets the following conditions—

(a) the main purpose, or one of the main purposes, of the service is to promote interaction between users (including interaction between users and user-generated content), and

(b) making content generated by users available to other users is a significant feature of the service.

(4) “Internet search engine” does not include a facility on a website that merely enables a person to search—

(a) the material on that website, or

(b) the material on that website and on closely related websites.

(5) “Online marketplace” means an online service that meets the following conditions—

(a) the main purpose, or one of the main purposes, of the service is to facilitate the sale by users of particular things, and

(b) the service enables users to sell particular things to other users, or to advertise or otherwise offer particular things for sale to other users.

(6) In subsection (5)—

(a) “thing” means any services, goods or other property;

(b) any reference to the sale of a thing includes hiring it.

(7) Any reference to providing a social media service, internet search engine or online marketplace includes carrying on an associated online advertising service; and any reference to a social media service, internet search engine or online marketplace is to be read accordingly.

(8) In this section “associated online advertising service” means an online service that—

(a) facilitates online advertising, and

(b) derives significant benefit from its association with the social media service, internet search engine or online marketplace.

(9) Where an associated online advertising service derives significant benefit from its association with more than one type of digital services activity, revenues arising from the service are to be treated as attributable to each of the types of digital services activity in question to such extent as is just and reasonable.

(10) See also section 45 (exclusion for online financial marketplaces).

Meaning of “user” and “UK user”

44

(1) This section applies for the purposes of this Part.

(2) Any reference to a user, in relation to a digital services activity of a person (the “provider”), does not include—

(a) the provider or a member of the same group as the provider, or

(b) an employee of a person within paragraph (a), acting in the course of that person's business.

(3) “UK user” means any user who it is reasonable to assume—

(a) in the case of an individual, is normally in the United Kingdom;

(b) in any other case, is established in the United Kingdom.

Exclusion for online financial marketplaces

45

(1) In this Part any reference to an online marketplace excludes one that is for the time being an online financial marketplace.

(2) An online marketplace is an “online financial marketplace” for a relevant accounting period if more than half of the revenues arising to the provider in the accounting period in connection with the online marketplace arise in connection with the provider's facilitation of the trading of financial instruments, commodities or foreign exchange.

(3) In subsection (2)—

(a) the reference to the trading of financial instruments includes the creation of such instruments;

(b) the reference to the trading of commodities is to the kind of commodities, and the kind of trading, occurring on a commodities exchange.

(4) In this section—

“financial instrument” means—a financial instrument within the meaning of the applicable accounting standards (see section 64), ora contract of insurance as defined by section 64 of FA 2012;

“provider” means the person providing the online marketplace;

“relevant accounting period” means an accounting period of the group of which the provider is a member.

Charge to tax

Meaning of “the threshold conditions”

46

(1) For the purposes of this Part “the threshold conditions”, in relation to a group, for an accounting period are—

(a) that the total amount of digital services revenues arising in that period to members of the group exceeds £500 million, and

(b) that the total amount of UK digital services revenues arising in that period to members of the group exceeds £25 million.

(2) But if the duration of the accounting period is less than a year, the amounts mentioned in subsection (1)(a) and (b) are proportionately reduced.

Charge to DST

47

(1) This section applies where the threshold conditions are met in relation to a group for an accounting period.

(2) Each person who was a member of the group in the accounting period (a “relevant person”) is liable to digital services tax in respect of UK digital services revenues arising in that period.

(3) To find the liability of a relevant person to digital services tax in respect of the accounting period, take the following steps.

Step 1 Take the total amount of UK digital services revenues arising to members of the group in the accounting period.

Step 2 Deduct £25million from the amount found under step 1.

Step 3 Calculate 2% of the amount calculated under step 2. The result is “the group amount”.

Step 4 The relevant person's liability to digital services tax in respect of the accounting period is the appropriate proportion of the group amount.

(4) In this section “the appropriate proportion” means such proportion of the total amount of UK digital services revenues arising to members of the group in the accounting period as is attributable to the relevant person.

(5) If the duration of the accounting period is less than a year, the sum mentioned in step 2 of subsection (3) is proportionately reduced.

(6) This section is subject to section 48 (alternative basis of charge).

Alternative basis of charge

48

(1) This section applies if a valid election under this section in respect of an accounting period has been made in the group's DST return for that period (whether as originally made or by amendment).

(2) An election under this section is valid if it specifies the categories of revenues in relation to which it applies (or specifies that it applies in relation to all categories).

(3) For this purpose, the categories of revenues are—

(a) revenues arising in connection with any social media service;

(b) revenues arising in connection with any internet search engine;

(4) To find the liability of a relevant person to digital services tax in respect of the accounting period, take the following steps (instead of the steps set out in section 47(3)).

Step 1 Take the total amount of UK digital services revenues arising to members of the group in the accounting period.

Step 2 Apportion the total amount found under step 1 between the three categories of revenues.

Step 3 For each category of revenues, the “net revenues” is the amount by which the amount of revenues apportioned under step 2 exceeds the relevant proportion of £25million.“The relevant proportion” is—$R TR$where—R is the amount of revenues apportioned under step 2 to the category, andTR is the total amount found under step 1.

Step 4 For each specified category of revenues, calculate the operating margin.“The operating margin” is—$R − E R$where—R has the same meaning as in step 3, andE is the amount of relevant operating expenses of the group that are recognised in the accounting period (as to which, see section 49).If R does not exceed E, the operating margin is nil.

Step 5 For each specified category of revenues, the taxable amount is 0.8 x the operating margin x the net revenues. For any other category of revenues, the taxable amount is 2% of the net revenues.

Step 6 Add together the taxable amounts calculated under step 5. The result is “the group amount”.

Step 7 The relevant person's liability to digital services tax in respect of the accounting period is the appropriate proportion of the group amount.

(5) If the duration of the accounting period is less than a year, the sum mentioned in step 3 of subsection (4) is proportionately reduced.

(6) In this section—

“the appropriate proportion” has the meaning given by section 47;

“relevant person” has the same meaning as in section 47;

“specified”, in relation to a category of revenues, means a category of revenues specified in the election.

Section 48: meaning of “relevant operating expenses”

49

(1) This section supplements section 48.

(2) The “relevant operating expenses” of a group, in relation to a specified category of revenues, means any expenses of a member of the group attributable to the earning of UK digital services revenues within the specified category, except excluded expenses.

(3) “Excluded expenses” means any expenses—

(a) in respect of interest (or anything equivalent, from a commercial perspective, to interest),

(b) attributable to the acquisition of a business or part of a business,

(d) resulting from a change in the valuation of any tangible or intangible asset, or

(e) in respect of any tax (arising under the law of any territory).

(4) Where expenses are attributable to—

(a) the earning of UK digital services revenues within the specified category, and

(b) anything else,

the expenses are to be treated as relevant operating expenses to such extent as is just and reasonable.

(5) In this section “specified” has the meaning given by section 48.

Relief for certain cross-border transactions

50

(1) This section applies if a claim under this section in respect of an accounting period has been included in the group's DST return for that period (whether as originally made or by amendment).

(2) For the purposes of step 1 in section 47(3) or 48(4), disregard 50% of any UK digital services revenues arising to a member of the group in the accounting period in connection with a relevant cross-border transaction.

(3) For the purposes of step 4 in section 48(4), disregard 50% of any relevant operating expenses of a member of the group recognised in the accounting period that result from a relevant cross-border transaction.

(4) “Relevant cross-border transaction” means a marketplace transaction where—

(a) the online marketplace is provided by a member of the group,

(b) a foreign user is a party to the transaction, and

(c) all or part of any revenues arising to a member of the group in connection with the transaction are (or would be) subject to a foreign DST charge.

(5) In this section—

“foreign user” means a user who it is reasonable to assume—in the case of an individual, is normally in a territory outside the United Kingdom;in any other case, is established in a territory outside the United Kingdom,and a reference to the foreign user's “territory” is to be read accordingly;

“foreign DST charge” means a charge (known by any name) under the law of the foreign user's territory which is similar to digital services tax;

“marketplace transaction” has the meaning given by section 41;

“relevant operating expenses” has the meaning given by section 49.

When DST is due and payable

51

Digital services tax in respect of an accounting period is due and payable on the day following the end of 9 months from the end of the accounting period.

Duty to submit returns etc

Meaning of “the responsible member”

52

(1) In this Part any reference to “the responsible member” of a group, at any time, is a reference to the following person—

(a) if at that time a nomination under subsection (2) is in force, the person nominated;

(b) otherwise, the parent of the group.

(2) The parent of a group may nominate a person to be “the responsible member” of the group if—

(a) the person is a member of the group,

(b) the person is a company, and

(c) the parent agrees in writing to provide the person with everything the person may reasonably require in order to comply with—

(i) any obligation imposed by or under this Part, or

(ii) any other obligation imposed on the person in connection with any digital services tax liability of any member of the group.

(3) A nomination is in force from the time it is made until any of the following events occurs—

(a) the parent nominates another person;

(b) the person nominated ceases to be a member of the group or ceases to be a company;

(4) An officer of Revenue and Customs may revoke a nomination only if the officer has reason to believe that the person nominated—

(a) is not being provided with something the person reasonably requires in order to comply with an obligation of a kind mentioned in subsection (2)(c), or

(b) is not complying with any such obligation.

(5) An officer of Revenue and Customs revokes a nomination by notifying the parent and the nominated person of the revocation.

The revocation has effect when the notification is issued.

(6) Any nomination, or revocation of a nomination, must be in writing.

Continuity of obligations etc where change in the responsible member

53

(1) This section applies if at any time (“the relevant time”) a person (“the new responsible member”) becomes the responsible member of a group in place of another person ( “ the old responsible member ”).

(2) The relevant obligations and liabilities of the new responsible member include any relevant obligations and liabilities of the old responsible member as respects the group.

(3) Anything done as respects the group by or in relation to the old responsible member, before the relevant time, is treated as having been done by or in relation to the new responsible member.

(4) Accordingly, a penalty may be imposed on the new responsible member in respect of anything done before the relevant time if, at that time, a penalty could have been imposed on the old responsible member in respect of the thing done.

(5) Anything done by HMRC in relation to the old responsible member as respects the group, before the end of the day the change is notified, is treated for all relevant purposes as done by or in relation to the new responsible member.

(6) Anything (including any proceedings) relating to the group that, at any time during the period beginning with the relevant time and ending with the day the change is notified, is in the process of being done in relation to the old responsible member may be continued in relation to the new responsible member.

(7) Accordingly, any reference in an enactment or other instrument to the responsible member of the group is to be read, so far as necessary for the purposes of giving effect to any of subsections (2) to (6), as being or including a reference to the new responsible member.

(8) In this section—

(a) any reference to an act includes an omission;

(b) any reference to the day the change is notified is to the day on which an officer of Revenue and Customs receives notification, in accordance with section 55, that the new responsible member has become the responsible member of the group;

(c) “relevant obligations and liabilities” means any obligations or other liabilities relating to digital services tax;

(d) “relevant purposes” means any purposes relating to digital services tax.

(9) Nothing in this section—

(a) prevents HMRC or anyone else, after the relevant time, from imposing a penalty, exercising any other power, or doing anything else, in relation to the old responsible member in respect of anything done before the relevant time, or

(b) affects the validity of anything done before the relevant time.

Duty to notify HMRC when threshold conditions are met

54

(1) This section applies—

(a) in relation to the first accounting period of a group in respect of which the threshold conditions are met, and

(b) where a direction under section 56 has been given in respect of a group, in relation to the first relevant accounting period in respect of which the threshold conditions are met.

In paragraph (b) “relevant accounting period” means the accounting period specified in the direction or any subsequent accounting period.

(2) The responsible member must provide specified information to HMRC.

(3) The information must be provided in the specified way.

(4) The information must be provided before the end of the period of 90 days from the end of the accounting period.

(5) In subsections (2) and (3) “specified” means specified in a notice published by HMRC.

Duty to notify HMRC of change in relevant information

55

(1) This section applies where section 54 applies or has applied in relation to a group.

(2) If at any relevant time there is a change in relevant information relating to the group, the responsible member must notify HMRC of that change.

(3) The notification must be given in the specified way.

(4) The notification must be given before the end of the period of 90 days beginning with the day on which the change occurs.

(5) In subsection (3) “specified” means specified in a notice published by HMRC.

(6) In this section—

“relevant information” means information of a kind specified under section 54(2);

“relevant time” means any time—after the time when the information is provided under section 54 or (if earlier) the last time by which the information may be provided in accordance with that section, andbefore the giving of a direction under section 56 in relation to the group.

Duty to file returns

56

(1) This section applies where the threshold conditions are met in relation to a group for an accounting period.

(2) The responsible member must deliver a DST return—

(a) for the accounting period, and

(b) for each subsequent accounting period, subject to subsection (3).

(3) An officer of Revenue and Customs may, on the application of the responsible member, direct that the duty to deliver a DST return does not apply in relation to an accounting period specified in the direction or subsequent accounting periods.

(4) Such a direction may be given only if it appears to the officer that the threshold conditions will not be met in relation to the group for any accounting period beginning with the specified accounting period.

(5) Nothing in a direction under subsection (3) prevents the further application of this section to the group, in any subsequent accounting period in which the threshold conditions are met.

(6) Schedule 8 contains provision about DST returns, enquiries, assessments etc.

Groups, parents and members

Meaning of “group”, “parent” etc

57

(1) In this Part “group” means—

(a) any entity which—

(i) is a relevant entity (see section 58), and

(ii) meets condition A or B (see subsections (2) and (3)), and

(b) each subsidiary (if any) of the entity mentioned in paragraph (a).

(2) Condition A is that the entity—

(a) is a member of a GAAP group, and

(b) is not a subsidiary of an entity that—

(i) is a relevant entity, and

(ii) itself meets condition A.

(3) Condition B is that the entity is not a member of a GAAP group.

(4) In this Part—

(a) references to the “parent” of a group are to the entity mentioned in subsection (1)(a);

(b) references to a “member” of a group are to an entity mentioned in subsection (1)(a) or (b);

(5) In this section “GAAP group” means a group within the meaning of the applicable accounting standards.

(6) For the meaning of “the applicable accounting standards” see section 64.

Section 57: meaning of “relevant entity”

58

(1) In section 57 “relevant entity” means—

(a) a company, or

(b) an entity the shares or other interests in which are listed on a recognised stock exchange and are sufficiently widely held.

(2) Shares or other interests in an entity are “sufficiently widely held” if no participator in the entity holds more than 10% by value of all the shares or other interests in the entity.

(3) The following are not relevant entities—

(a) the Crown;

(b) a Minister of the Crown;

(d) a Northern Ireland department;

(e) a foreign sovereign power.

(4) In this section—

(a) “participator” has the meaning given by section 454 of CTA 2010;

(b) “recognised stock exchange” has the meaning given by section 1137 of CTA 2010;

(c) the reference to shares or other interests being listed on a recognised stock exchange is to be read in accordance with section 1137 of CTA 2010.

(5) For the meaning of “company” see section 72.

Continuity of a group over time

59

(1) In this Part, this section applies for the purpose of determining whether a group at any time (Time 2) is the same group as a group at any earlier time (Time 1).

(2) The group at Time 2 is the same group as the group at Time 1 if and only if the entity that is the parent of the group at Time 2—

(a) was the parent of the group at Time 1, and

(b) was the parent of a group at all times between Time 1 and Time 2.

Treatment of stapled entities

60

(1) This section applies where two or more entities—

(a) would, apart from this section, be the parent of a group, and

(b) are stapled to each other.

(2) This Part applies as if—

(a) the entities were subsidiaries of another entity (the “deemed parent”), and

(b) the deemed parent were within section 57(1)(a) (conditions for being the parent of a group).

(3) For the purpose of this section, an entity (A) is “stapled” to another entity (B) if, in consequence of the nature of the rights attaching to the shares or other interests in A (including any terms or conditions attaching to the right to transfer the interests), it is necessary or advantageous for a person who has, disposes of or acquires shares or other interests in A also to have, dispose of or acquire shares or other interests in B.

Accounting periods, accounts etc

Accounting periods and meaning of “a group’s accounts”

61

(1) This section applies for the purposes of this Part.

(2) A group's first accounting period—

(a) begins with 1 April 2020, and

(b) ends with the first accounting reference date to occur after that date or, if earlier, with 31 March 2021.

This is subject to subsection (4) (rule for groups coming into existence after 1 April 2020).

(3) Any other accounting period of a group—

(a) begins immediately after the end of the previous accounting period, and

(b) ends with the first accounting reference date to occur after it begins or, if earlier, one year after it begins.

(4) In the case of a group formed after 1 April 2020, its first accounting period—

(a) begins with the date on which it is formed, and

(b) ends with the first accounting reference date to occur after that date or, if earlier, one year after it begins.

(5) In this section “accounting reference date” means the date to which the group's accounts are made up.

(6) Any reference to a group's accounts is to—

(a) the consolidated accounts of the group's parent and its subsidiaries, or

(b) the parent's accounts (if the parent is the only member of the group throughout the period in question).

Apportionment of revenues or expenses to accounting period

62

(1) This section applies if a group's period of account does not coincide with an accounting period.

(2) The revenues or expenses of a period of account may be apportioned to the parts of that period falling within different accounting periods.

(3) The apportionment must be made by reference to the number of days in the periods concerned.

Meaning of revenues arising, or expenses recognised, in a period

63

(1) In this Part any reference to revenues arising to members of a group in a period, or to expenses of members of a group recognised in a period, is to be interpreted as follows.

(2) For any period of account of the group for which the group's accounts are produced in accordance with the applicable accounting standards, the reference is to—

(a) revenues (however described) or expenses recognised in the income statement (or in profit and loss) for that period, or

(b) if any consolidation exemption applies, to revenues (however described) or expenses that would be recognised in the income statement (or in profit and loss) for that period if no consolidation exemption were applicable.

(3) For any period of account of the group not falling within subsection (2), the reference is to revenues or expenses that would be recognised in the income statement (or in profit and loss) in the group's accounts produced in accordance with IAS for the period if such accounts were produced (and no consolidation exemption was applicable).

(4) If the group does not produce accounts for any period (“the relevant period”) in an accounting period, the reference is to revenues or expenses that would be recognised in the income statement (or in profit and loss) in the group's accounts produced in accordance with IAS for the relevant period if such accounts were produced (and no consolidation exemption was applicable).

(5) In this section “consolidation exemption” means any exemption in the applicable accounting standards from a requirement to consolidate revenues.

Meaning of “the applicable accounting standards” etc

64

(1) This section applies for the purposes of this Part.

(2) “The applicable accounting standards”, in relation to a group, means—

(a) for any period for which the group's accounts are produced in accordance with UK GAAP, UK GAAP;

(b) for any period for which the group's accounts are produced in accordance with acceptable overseas GAAP, acceptable overseas GAAP;

(d) otherwise, IAS.

(3) “UK GAAP”—

(a) means generally accepted accounting practice in relation to accounts of UK companies (other than accounts prepared in accordance with IAS) that are intended to give a true and fair view, and

(b) has the same meaning in relation to persons other than companies, and companies that are not UK companies, as it has in relation to UK companies.

“UK companies” here means companies incorporated or formed under the law of a part of the United Kingdom.

(4) “Acceptable overseas GAAP” means the generally accepted accounting practice and principles of any of the following—

Canada;

China;

Japan;

South Korea;

the United States of America.

(5) “IAS” means—

(a) International Accounting Standards,

(b) International Financial Reporting Standards, and

issued or adopted, from time to time, by the International Accounting Standards Board.

(6) In subsection (2)(c), “specified” means specified in a notice published by HMRC.

Supplementary

Anti-avoidance

65

(1) Any tax advantage that would (apart from this section) arise from relevant avoidance arrangements is to be counteracted by the making of such adjustments as are just and reasonable.

(2) The adjustments (whether or not made by an officer of Revenue and Customs) may be made by way of an assessment, the modification of an assessment, amendment or disallowance of a claim, or otherwise.

(3) Arrangements are “relevant avoidance arrangements” if their main purpose, or one of their main purposes, is to enable a person to obtain a tax advantage.

(4) But arrangements are not “relevant avoidance arrangements” if the obtaining of any tax advantage that would (apart from this section) arise from them can reasonably be regarded as consistent with—

(a) any principles on which the provisions of this Part that are relevant to the arrangements are based (whether express or implied), and

(b) the policy objectives of those provisions.

(5) In this section—

“arrangements” include any agreement, understanding, scheme, transaction or series of transactions (whether or not legally enforceable);

“tax” means digital services tax (and “tax advantage” is to be construed accordingly);

“tax advantage” includes—avoidance or reduction of a charge to tax or an assessment to tax,repayment or increased repayment of tax,avoidance of a possible assessment to tax, anddeferral of a payment of tax or advancement of a repayment of tax.

Notice requiring payment from other group members

66

(1) This section applies where any DST liability relating to a group for an accounting period is unpaid at the end of the period of 3 months after the relevant date.

(2) A designated officer may give a notice (a “payment notice”) to a relevant person requiring that person, within 30 days of the giving of the notice, to pay all unpaid DST liabilities relating to the group for the accounting period.

(3) A payment notice must state—

(a) the amount of any digital services tax or penalty that remains unpaid,

(b) the date any digital services tax or penalty first became payable, and

(4) A payment notice may not be given more than 3 years and 6 months after the relevant date.

(5) If the DST liability arose because of a determination under Part 5 of Schedule 8, the relevant date is the date on which the notice of determination is issued.

(6) If the DST liability arose because of a self-assessment, the relevant date is the later of—

(a) the date on which the tax becomes due and payable;

(b) in a case where the DST return is delivered after the filing date, the date on which the return is delivered;

(d) if more than one notice of enquiry is given, the date on which the last notice is given;

(e) if as a result of such an enquiry the DST return is amended, the date on which the notice of the amendment is issued;

(f) if there is an appeal against such an amendment, the date on which the appeal is finally determined.

(7) If the DST liability arose because of an assessment under Part 6 or 7 of Schedule 8, the relevant date is—

(a) if there is no appeal against the assessment, the date on which the notice of assessment is issued, or

(b) if there is such an appeal, the date on which the appeal is finally determined.

(8) If the DST liability arose because of a penalty, the relevant date is the date on which the notice of the penalty is issued.

(9) A payment notice may be given anywhere in the world, to any relevant person (whether or not resident in the United Kingdom).

(10) Schedule 9 makes further provision about payment notices.

(11) In this section—

“designated officer” means an officer of Revenue and Customs who has been designated by the Commissioners for the purposes of this Part;

“DST liability”, in relation to a group for an accounting period, means—a liability of a relevant person to digital services tax in respect of that period, ora liability of a person to a penalty for anything done (or not done) in respect of the accounting period;

“the filing date” has the same meaning as in Schedule 8 (see paragraph 1(1));

“relevant person” means any person who was a member of the group in the accounting period.

(12) The reference in subsection (6) to a self-assessment includes a reference to a self-assessment that supersedes a determination (see paragraph 18 of Schedule 8).

(13) In this section references to “digital services tax” include references to interest on digital services tax.

Interest on overdue DST

67

(1) Digital services tax carries interest at the applicable rate from the date when the tax becomes due and payable until payment.

(2) This applies even if the date when the tax becomes due and payable is—

(a) a Saturday or Sunday,

(b) Good Friday, Christmas Day, a bank holiday or other public holiday, or

(c) a day specified in an order made under section 2 of the Banking and Financial Dealings Act 1971 (power to suspend financial dealings).

(3) In this section “the applicable rate” means the rate applicable under section 178 of FA 1989.

Interest on overpaid DST etc

68

(1) Where a payment in respect of a person's digital services tax liability for an accounting period is made before the due date, the payment carries interest at the applicable rate from the later of—

(a) the date the payment is made, and

(b) 6 months and 13 days from the start of the accounting period,

until the due date.

(2) Where a repayment of digital services tax paid by a person for an accounting period falls to be made, the repayment carries interest at the applicable rate—

(a) from the due date or, if later, the date the digital services tax was paid, and

(b) until the order for repayment is issued.

(3) Where a repayment of digital services tax is a repayment of tax paid by a person on different dates, it is to be treated so far as possible as a repayment of tax paid on a later (rather than an earlier) date among those dates.

(4) Where—

(a) interest has been paid to a person under this section,

(b) there is a change in the person's assessed liability,

(d) as a result of the change (and in particular not as a result of an error in the calculation of interest) it appears to an officer of Revenue and Customs that some or all of the interest ought not to have been paid,

the interest that ought not to have been paid may be recovered from the person.

(5) For the purposes of subsection (4)(b) there is a change in a person's assessed liability if (and only if)—

(a) an assessment, or an amendment of an assessment, of the amount of digital services tax payable by the person for the accounting period in question is made, or

(b) an HMRC determination of that amount is made,

whether or not any previous assessment or determination has been made.

(6) In this section—

“the applicable rate” has the same meaning as in section 67;

“the due date”, in relation to an accounting period, means the date digital services tax for the accounting period becomes due and payable;

“error” includes—any computational error, andthe allowance of a claim that ought not to have been allowed;

“HMRC determination” means a determination under Part 5 of Schedule 8.

Recovery of DST liability

69

(1) Any amount due by way of DST liability is recoverable as a debt due to the Crown.

(2) In this section “DST liability” has the same meaning as in section 66.

Minor and consequential amendments

70

Schedule 10 contains minor and consequential amendments.

Review of DST

71

(1) The Treasury must, before the end of 2025, conduct a review of digital services tax and prepare a report of the review.

(2) The Treasury must lay a copy of the report before Parliament.

General

Interpretation of Part

72

In this Part—

“accounting period” has the meaning given by section 61;

“the applicable accounting standards” has the meaning given by section 64;

“the Commissioners” has the meaning given by section 39;

“company” has the meaning given by section 1121(1) of CTA 2010;

“digital services activity” has the meaning given by section 43;

“digital services revenues” has the meaning given by section 40;

“group” has the meaning given by section 57;

“group's accounts” has the meaning given by section 61;

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

“IAS” has the meaning given by section 64;

“member” has the meaning given by section 57;

“parent” has the meaning given by section 57;

“the responsible member” has the meaning given by section 52;

“subsidiary” has the meaning given by section 57;

“the threshold conditions” has the meaning given by section 46;

“UK digital services revenues” has the meaning given by section 41;

“UK user” has the meaning given by section 44;

“user” has the meaning given by section 44.

PART 3 — Other taxes

Inheritance tax

Excluded property etc

73

(1) IHTA 1984 is amended as follows.

(2) In section 48 (excluded property)—

(a) in subsection (3)(a), for “settlement was made” substitute “ property became comprised in the settlement (but see also subsection (3F)) ”,

(b) in subsection (3A)(a), for “settlement was made” substitute “ property became comprised in the settlement (but see also subsection (3F)) ”,

(c) in subsection (3E), for “settlement is made” substitute “ property became comprised in the settlement (but see also subsection (3F)) ”, and

(d) after subsection (3E) insert—

(3F) If— (a) an amount is payable in respect of property (“the existing property”) comprised in a settlement, and (b) the amount represents an accumulation of income which (once accumulated) becomes comprised in the settlement, subsections (3)(a), (3A)(a) and (3E) have effect, in the case of the amount, as if any reference to the time it became comprised in the settlement were to the time the existing property became comprised in the settlement.

(3) After section 48 insert—

(48A) In this Act any reference to the commencement of a settlement is to the time when property first becomes comprised in it.

(4) Omit section 60 (meaning of commencement of settlement for purposes of Chapter).

(5) In section 64 (charge at ten-year anniversary)—

(a) in subsection (1B)—

(i) after “settlor of” insert “ property comprised in ”,

(ii) for “settlement was made” substitute “ property became comprised in the settlement (but see also subsection (1BA)) ”, and

(iii) after “income of the settlement” insert “ that arose (directly or indirectly) from the property ”, and

(b) after that subsection insert—

(1BA) If— (a) an amount is payable in respect of property (“the existing property”) comprised in a settlement, and (b) the amount represents an accumulation of income which (once accumulated) becomes comprised in the settlement, subsection (1B) has effect, in the case of the amount, as if any reference to the time it became comprised in the settlement were to the time the existing property became comprised in the settlement.

(6) In section 65 (charge at other times)—

(a) in subsection (7A), for “settlement made” substitute “ property became comprised in settlement ”,

(b) in subsection (8)—

(i) after “settlor of” insert “ property comprised in ”,

(ii) for “settlement was made” substitute “ property became comprised in the settlement (but see also subsection (8A)) ”, and

(iii) for “property comprised in the settlement” substitute “ the property ”, and

(8A) If— (a) an amount is payable in respect of property (“the existing property”) comprised in a settlement, and (b) the amount represents an accumulation of income which (once accumulated) becomes comprised in the settlement, subsection (8) has effect, in the case of the amount, as if any reference to the time it became comprised in the settlement were to the time the existing property became comprised in the settlement.

(7) In section 74A (arrangements involving acquisition of interest in settled property etc)—

(a) in subsection (2)(a), for “settlement was made” substitute “ relevant settled property became comprised in the settlement ”, and

(b) in subsection (3)(a), for “settlement was made” substitute “ relevant settled property became comprised in the settlement ”.

(8) In section 157(3) (non-residents' bank accounts), for “he made” substitute “ the settled property became comprised in ”.

(9) In section 237(1)(b) (imposition of charge), for “the chargeable transfer is made by the making of a settlement or” substitute “ property becomes comprised in a settlement by virtue of the chargeable transfer or the chargeable transfer ”.

(10) In section 272 (general interpretation)—

(a) before the definition of “conditionally exempt transfer” insert—

“commencement” of a settlement has the meaning given by section 48A;

, and

(b) in the definition of “foreign-owned”, in paragraph (b)(ii), at the end insert “ (and section 64(1BA) applies for the purposes of this sub-paragraph as it applies for the purposes of section 64(1B)) ”.

(11) In relation to any chargeable transfer made on or after the day on which this Act is passed, the amendments made by this section are treated as always having been in force.

Section 2(3) of IHTA 1984 applies for the purposes of this subsection.

Transfers between settlements etc

74

(1) IHTA 1984 is amended as follows.

(2) After section 81A insert—

(81B) (1) This section applies to property to which section 80 (initial interest of settlor etc) applies. (2) If the property would apart from this section be excluded property by virtue of section 48(3)(a) or (3A)(a), the property is at any time in a tax year to be regarded as excluded property for the purposes of this Chapter, except sections 78 and 79, only if Conditions A and B are met. (3) Section 65(8) has effect in relation to the property only if Condition A is met (in addition to any condition mentioned in that provision). (4) Condition A is that the actual settlor was not domiciled in the United Kingdom at the time of the occasion first referred to in section 80(1). (5) Condition B is that the actual settlor is not a formerly domiciled resident for the tax year. (6) In this section “the actual settlor” means the person who is the settlor of the property in relation to the settlement first mentioned in section 80(1). (7) Where the occasion first referred to in section 80(1) occurred before the day on which the Finance Act 2020 was passed, this section has effect as if, in subsection (2), “or (3A)(a)” were omitted.

(3) In section 82 (excluded property)—

(a) in subsection (1), omit “80 or”,

(b) in subsection (2)—

(i) omit “80 or”, and

(ii) for “settlement was made” substitute “ property became comprised in the settlement ”,

(d) in subsection (4), omit paragraph (a),

(e) after that subsection insert—

(5) This section does not apply in relation to a case to which section 82A applies.

, and

(f) in the heading, at the end insert “ : property to which section 81 applies (old cases) ”.

(4) After section 82 insert—

(82A) (1) This section— (a) applies where, at any time on or after the day on which the Finance Act 2020 is passed, property ceases to be comprised in a settlement (“the first settlement”) but is treated as a result of section 81 as remaining comprised in that settlement for the purposes of this Chapter, and (b) applies whether or not at any subsequent time the property is comprised in the first settlement without regard to that section. (2) If the property would apart from this section be excluded property by virtue of section 48(3)(a) or (3A)(a), the property is to be regarded as excluded property for the purposes of this Chapter, except sections 78 and 79, at any time only if the non-domicile condition is met in relation to each qualifying transfer occurring on or before that time. (3) Section 65(8) has effect in relation to the property at any time only if (in addition to the condition mentioned there) the non-domicile condition is met in relation to each qualifying transfer occurring on or before that time; but, for the purposes of this subsection, the non-domicile condition has effect with the omission of subsection (6)(a)(ii). (4) For the purposes of this section each of the following is a “qualifying transfer”— (a) the occasion on which section 81 applies to the property; and (b) any subsequent occasion on which the property would, if the effect of section 81 were ignored, become comprised in a settlement to which this Chapter applies (including the first settlement). (5) But a qualifying transfer does not occur as a result of— (a) an assignment by a beneficiary of an interest in a settlement, or (b) an exercise of a general power of appointment, unless the time of the assignment or exercise of the power falls on or after the day on which the Finance Act 2020 is passed. (6) For the purposes of this section “the non-domicile condition” is— (a) in a case where a qualifying transfer occurs as a result of an assignment by a beneficiary of an interest in a settlement or an exercise of a general power of appointment, that the beneficiary or the person exercising the power— (i) was not domiciled in the United Kingdom at the time of the assignment or exercise of the power, and (ii) is not a formerly domiciled resident for the tax year in which the time mentioned in subsection (2) falls; (b) in a case in which section 81 applies which is not within paragraph (a), that the person who was the settlor of the property in relation to the first settlement was not domiciled in the United Kingdom immediately before the time when the property ceased to be comprised in the first settlement; (c) in any other case, that the person who was the settlor of the property in relation to the first settlement was not domiciled in the United Kingdom immediately before the time of the subsequent occasion. (7) If— (a) the settlor mentioned in subsection (6)(b) or (c) has died before the time mentioned there, and (b) the death does not give rise to a qualifying transfer, the non-domicile condition is treated as met. (8) In this section any reference to a qualifying transfer occurring as a result of— (a) an assignment by a beneficiary of an interest in a settlement, or (b) an exercise of a general power of appointment, includes the transfer occurring partly as a result of the assignment or exercise of the power. (9) In this section any reference to an assignment includes an assignation.

(5) In relation to any chargeable transfer made on or after the day on which this Act is passed, the amendments made by subsections (2) and (3) are treated as always having been in force.

Section 2(3) of IHTA 1984 applies for the purposes of this subsection.

Relief for payments to victims of persecution during Second World War era

75

(1) IHTA 1984 is amended as follows.

(2) In section 153ZA (inheritance tax relief for payments to victims of persecution during Second World War era: qualifying payments), after subsection (8) insert—

(8A) Regulations under this section may have effect in relation to deaths occurring before the regulations are made.

(3) In Schedule 5A (inheritance tax relief for payments to victims of persecution during Second World War era), in Part 1 (compensation payments), after paragraph 9 insert—

(10) A one-off payment of a fixed amount from the Kindertransport Fund established by the Government of the Federal Republic of Germany.

(4) The amendment made by subsection (3) has effect in relation to deaths occurring on or after 1 January 2019.

Stamp duty land tax

Exceptional circumstances preventing disposal of interest in three year period

76

(1) In FA 2003, Schedule 4ZA (stamp duty land tax: higher rates for additional dwellings etc) is amended as follows.

(2) In paragraph 3 (single dwelling transactions)—

(a) in sub-paragraph (7)(b) for “the period of three years beginning with the day after the effective date of the transaction concerned” substitute “ a permitted period ”;

(b) after sub-paragraph (7) insert—

(7A) For the purposes of sub-paragraph (7)(b), the permitted periods are— (a) the period of three years beginning with the day after the effective date of the transaction concerned, or (b) if HMRC are satisfied that the purchaser or the purchaser's spouse or civil partner would have disposed of the major interest in the sold dwelling within that three year period but was prevented from doing so by exceptional circumstances that could not reasonably have been foreseen, such longer period as HMRC may allow in response to an application made in accordance with sub-paragraph (7B). (7B) An application for the purposes of sub-paragraph (7A)(b) must— (a) be made within the period of 12 months beginning with the effective date of the transaction disposing of the major interest in the sold dwelling, and (b) be made in such form and manner, and contain such information, as may be specified by HMRC. (7C) Schedule 11A (claims not included in returns) does not apply in relation to an application made in accordance with sub-paragraph (7B).

(3) In paragraph 8 (further provision in connection with paragraph 3(6) and (7))—

(a) in sub-paragraph (3), after “paragraph 3(7)” insert “ by virtue of paragraph 3(7A)(a) ”;

(b) in sub-paragraph (4), after “paragraph 3(7)” insert “ by virtue of paragraph 3(7A)(a) ”;

(5) Where HMRC grant an application made in accordance with paragraph 3(7B)— (a) the land transaction return in respect of the transaction concerned is treated as having been amended to take account of the application of paragraph 3(7) by virtue of paragraph 3(7A)(b), and (b) HMRC must notify the purchaser accordingly.

(4) The amendments made by this section have effect in a case where the effective date of the transaction concerned is on or after 1 January 2017.

Stamp duty and stamp duty reserve tax

Stamp duty: transfers of unlisted securities and connected persons

77

After section 47 of FA 2019 insert—

(47A) (1) This section applies if— (a) an instrument transfers unlisted securities to a company or a company's nominee for consideration, (b) the person transferring the securities is connected with the company or is the nominee of a person connected with the company, and (c) some or all of the consideration consists of the issue of shares. (2) In this section “unlisted securities” means stock or marketable securities that are not listed securities within the meaning of section 47 (stamp duty: transfers of listed securities and connected persons). (3) For the purposes of the enactments relating to stamp duty the amount or value of the consideration is to be treated as being equal to— (a) the amount or value of the consideration for the transfer, or (b) if higher, the value of the unlisted securities. (4) For the purposes of subsection (3) “the enactments relating to stamp duty” means the Stamp Act 1891 and any enactment amending that Act or that is to be construed as one with that Act. (5) For the purposes of this section— (a) the value of unlisted securities is to be taken to be the market value of the securities at the date the instrument is executed; (b) “market value” has the same meaning as in TCGA 1992 and is to be determined in accordance with sections 272 and 273 of that Act (valuation). (6) Section 1122 of CTA 2010 (connected persons) has effect for the purposes of this section. (7) This section is to be construed as one with the Stamp Act 1891. (8) This section has effect in relation to instruments executed on or after the date on which FA 2020 is passed.

SDRT: unlisted securities and connected persons

78

After section 48 of FA 2019—

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

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