Finance Act 2020

88A

• (1) This section applies where—

• (a) a UK heavy goods vehicle (the “charged vehicle”) is charged to vehicle excise duty in respect of more than one period (a “charged period”) beginning within the last 12 months of the exempt period, and

• (b) the combined length of the charged periods is more than 12 months.

• (2) Section 5(2) of the 2013 Act applies in relation to the charged vehicle in respect of each complete month in the period (the “transitional liability period”)—

• (a) beginning with the day after the last exempt day in relation to the charged vehicle, and

• (b) ending with the end of the charged period during which that last exempt day occurs.

• (3) The last exempt day, in relation to a charged vehicle, is the last day of the period of 12 months beginning with the day on which the first charged period beginning within the last 12 months of the exempt period began.

• (4) Subsection (5) applies where, in relation to the charged vehicle—

• (a) a notification has been made under section 7(2)(c) of the 2013 Act (an “off-road notification”) in respect of a period beginning within the last 12 months of the exempt period, and

• (b) vehicle excise duty is charged in respect of a period beginning—

• (i) after the day on which the off-road notification is made, and

• (ii) within the last 12 months of the exempt period.

• (5) In calculating the period of 12 months mentioned in subsection (3) ignore the number of whole months in the period beginning with the day on which the off-road notification is made and ending with the first day of the period described in subsection (4)(b).

• (6) The Secretary of State, and any person who may exercise powers on behalf of the Secretary of State under section 9 of the 2013 Act (collection of levy), may (in addition to having the powers, duties and liabilities mentioned in that section) give a notice (a “payment notice”) to a person liable for HGV road user levy in respect of a transitional liability period.

• (7) A payment notice must state—

• (a) the amount of HGV road user levy for which the person is liable in respect of the transitional liability period,

• (b) how the amount is to be paid, and

• (c) that payment must be made within the period of 28 days beginning with the day on which the notice is given.

• (8) The amount in subsection (7)(a) is given by—

$$L×M12$where—L is the yearly rate of HGV road user levy applicable in relation to the vehicle on the first day of the transitional liability period, andM is the number of whole months during the transitional liability period.$

• (9) In relation to the transitional liability period—

• (a) a person commits an offence under section 11 of the 2013 Act (offence of using or keeping heavy goods vehicle if levy not paid) only if the person—

• (i) has been given a payment notice, and

• (ii) has failed to make payment in accordance with that notice, and

• (b) section 7(5A) of the Vehicle Excise and Registration Act 1994 has effect as if the reference to HGV road user levy having been paid were a reference to it having been paid in accordance with a payment notice.

• (10) In this section “UK heavy goods vehicle” has the same meaning as in the HGV Road User Levy Act 2013 (see section 2 of that Act).

Rebated fuel: private pleasure craft

Amounts of gross gaming yield charged to gaming duty

Rates of climate change levy from 1 April 2021

Rates of landfill tax

Carbon emissions tax

HMRC debts: priority on insolvency

HMRC debts: regulations

Interest on unpaid tax in case of disaster etc of national significance

Taxation of coronavirus support payments

Modifications of the statutory residence test in connection with coronavirus

Future Fund: EIS and SEIS relief

Interpretation

Part 1 — Income tax and other related relief

Part 2 — Corporation tax and other related relief

Relevant compensation payments

6

This Part of this Schedule provides for the following—

• (a) an exemption from corporation tax for relevant compensation payments, and

• (b) an exemption from income tax and capital gains tax for relevant onward payments.

7

• (1) In this Part of this Schedule “relevant compensation payment” means a payment made to a company under—

• (a) the GLO Compensation Scheme,

• (b) the Horizon Shortfall Scheme,

• (c) the Suspension Remuneration Review,

• (d) the Post Office Process Review, or

• (e) such other compensation scheme of a description specified in regulations made by the Treasury.

• (2) The power under sub-paragraph (1)(e) to specify a description of compensation scheme is exercisable only if the scheme provides for the payment of compensation to persons by or on behalf of—

• (a) the government of the United Kingdom,

• (b) the government of a part of the United Kingdom,

• (c) the government of any other country or territory,

• (d) a local or other public authority in the United Kingdom, or

• (e) a local or other public authority of a territory outside the United Kingdom.

• (3) The power under sub-paragraph (1)(e) may be exercised so as to provide—

• (a) for the provisions of this Part of this Schedule to apply to all descriptions of payments made under a compensation scheme or only to such descriptions as may be specified in the regulations;

• (b) for all provisions of this Part of this Schedule to apply to payments made under a compensation scheme or only for such provisions to apply as are specified in the regulations.

• (4) The power under sub-paragraph (1)(e) must be exercised so as to provide that the reliefs conferred by this Part of this Schedule in respect of the compensation schemes mentioned in sub-paragraph (1)(a) to (d) are also conferred in a corresponding or similar way in respect of other relevant schemes.

• (5) The reference in sub-paragraph (4) to “relevant schemes” is a reference to any compensation schemes established for the purposes of—

• (a) compensating persons affected by the Horizon system, or

• (b) compensating persons in respect of other matters identified in High Court judgments given in proceedings relating to the Horizon system.

8

• (1) For the purposes of this Part of this Schedule a payment is a “relevant onward payment” if or to the extent that—

• (a) the payment is made by a company to which a relevant compensation payment was made,

• (b) the payment is to an individual and—

• (i) the individual is or was a director or employee of the company, or

• (ii) the payment is a distribution by the company to shareholders, and

• (c) it is reasonable to conclude from the circumstances that the payment is made by the company to the individual for the purpose of passing on all or part of the compensation payment mentioned in paragraph (a) to the individual.

• (2) But where sub-paragraph (3) applies to the relevant compensation payment mentioned in sub-paragraph (1)(a), a payment to an individual is a relevant onward payment for the purposes of this Part of this Schedule only so far as it relates to such part of the relevant compensation payment as was made for the purpose of topping up the amount of compensation paid to account for sums lost to tax.

• (3) This sub-paragraph applies to a relevant compensation payment—

• (a) made (at any time) under the Horizon Shortfall Scheme;

• (b) made before 1 January 2024 under the Suspension Remuneration Review.

9

• (1) No liability to corporation tax arises in respect of a relevant compensation payment.

• (2) The following are to be ignored for all other corporation tax purposes—

• (a) the receipt by a company of a relevant compensation payment;

• (b) the making by a company of a relevant onward payment.

• (3) This paragraph has effect—

• (a) in the case of relevant compensation payments falling within paragraph 7(1)(a), (b), (c) or (d), whenever the payments are received;

• (b) in the case of relevant compensation payments falling within paragraph 7(1)(e), where the payments are received on or after such date as is specified in the regulations concerned;

• (c) in the case of relevant onward payments that relate to paragraph 7(1)(a), (b), (c) or (d), whenever the payments are made;

• (d) in the case of relevant onward payments that relate to paragraph 7(1)(e), where the payments are made on or after such date as is specified in the regulations concerned.

• (4) The date specified in regulations as mentioned in sub-paragraph (3)(b) and (d) may be a date before the regulations are made.

10

• (1) Paragraph 3(1) and (2) (exemption from income tax) applies to a relevant onward payment as it applies to a qualifying payment.

• (2) Paragraph 4(1) and (2) (exemption from capital gains tax) applies to a relevant onward payment as it applies to a qualifying payment.

• (3) Sub-paragraph (1) has effect—

• (a) in the case of relevant onward payments that relate to paragraph 7(1)(a), (b), (c) or (d), whenever the payments are received;

• (b) in the case of relevant onward payments that relate to paragraph 7(1)(e), where the payments are received on or after such date as is specified in the regulations concerned.

• (4) Sub-paragraph (2) has effect—

• (a) in the case of relevant onward payments that relate to paragraph 7(1)(a), (b), (c) or (d), in relation to disposals whenever made;

• (b) in the case of relevant onward payments that relate to paragraph 7(1)(e), in relation to disposals made on or after such date as is specified in the regulations concerned.

• (5) The date specified in regulations as mentioned in sub-paragraph (3)(b) and (4)(b) may be a date before the regulations are made.

11

• (1) The Treasury may by regulations make provision for the purpose of providing relief from corporation tax, income tax or capital gains tax in relation to the receipt of payments made under compensation schemes that is supplementary or incidental to provision contained in this Part of this Schedule.

• (2) Provision under this paragraph may (among other things)—

• (a) make different provision for different compensation schemes;

• (b) make provision having retrospective effect.

12

• (1) A power to make regulations under this Part of this Schedule is exercisable by statutory instrument.

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

13

• (1) In this Part of this Schedule—

• “GLO Compensation Scheme” means the scheme announced by His Majesty’s Government on 22 March 2022 with the objective of ensuring that persons who were party to a claim against Post Office Limited in respect of the Horizon system that was subject to a group litigation order have access to compensation for losses related to that system;

• “Horizon Shortfall Scheme” means the scheme established on 1 May 2020 by Post Office Limited to compensate persons who were adversely affected by accounting shortfalls related to the Horizon system;

• “the Horizon system” means previous versions of the computer system used by Post Office Limited known as Horizon (and sometimes referred to as Legacy Horizon, Horizon Online or HNG-X);

• “Post Office Limited” means the private company limited by shares with the company number 02154540 whose registered office is 100 Wood Street, London EC2V 7ER;

• “Post Office Process Review” means the review established by Post Office Limited to provide redress to postmasters who were financially impacted by previous processes or policies in relation to balance discrepancies unrelated to the Horizon system;

• “Suspension Remuneration Review” means the review established by Post Office Limited to provide redress to postmasters contracted to deliver Post Office services through branches who were suspended before March 2019 and did not receive remuneration during their period of suspension.

• (2) For the purposes of this Part of this Schedule—

• (a) a relevant onward payment “relates” to paragraph 7(1)(a) if the related relevant compensation payment mentioned in paragraph 8(1)(c) falls within paragraph 7(1)(a) (and references to payments relating to paragraph 7(1)(b), (c), (d) or (e) are to be read accordingly);

• (b) references to a compensation scheme include references to any arrangements for the making of payments of compensation.