The Lloyd’s Underwriters (Tax) (1988–89) Regulations 1991

Made: 28th March 1991

Laid before the House of Commons: 28th March 1991

Coming into force: 19th April 1991

The Commissioners of Inland Revenue, in exercise of the powersconferred on them by section 142A(5) and (6) of the Capital Gains TaxAct 1979[^f00001], section 451(1) and (1A) of and paragraph 1(1) and (3)of Schedule 19A to the Income and Corporation Taxes Act 1988[^f00002] and section 92(5), (6) and (7) of the Finance Act 1989[^f00003], hereby make the following Regulations:

Citation, commencement and effect

1

• (1) These Regulations may be cited as the Lloyd’s Underwriters (Tax)(1988–89) Regulations 1991 and shall come into force on 19thApril 1991 but shall have effect for the year of assessment1988–89 only.

• (2) Except for regulations 2, 3, 7 and 21(1) to (3), the Lloyd'sUnderwriters (Tax) Regulations 1974[^f00004] shall not have effect for the year of assessment1988–89.

Interpretation

2

• (1) In these Regulations unless the context otherwise requires—

• “Board” means the Commissioners of Inland Revenue;

• “inspector” includes any officer of the Board;

• “managing agent” and

• “members' agent” have the meanings that they have in Schedule 19A;

• “member” means an underwriting member of Lloyd's;

• “Schedule 19A” means Schedule 19A to the Income and Corporation Taxes Act 1988;

• “section 142A” means section 142A of the Capital Gains Tax Act 1979;

• “section 450” means section 450 of the Income and Corporation Taxes Act 1988[^f00005];

• “syndicate gains” means the chargeable gains accruing to a member on the disposal ofassets forming part of a premiums trust fund;

• “syndicate investment income” means the profits or gains arising to a member from assets formingpart of a premiums trust fund;

• “the Taxes Acts” means the Taxes Management Act 1970[^f00006] and— the Tax Acts, and the Capital Gains Tax Act 1979 and all other enactments relating tocapital gains tax.

• (2) For the purposes of construing any reference in these Regulations tothe year of assessment which corresponds to an underwriting year or tothe underwriting year which corresponds to a year of assessment, anunderwriting year and a year of assessment correspond to each other ifthe underwriting year ends in the year of assessment.

Assessment and collection: general

3

• (1) Subject to paragraph (2) and regulations 4 to 7, the like provisionsas are contained in the Taxes Acts relating to the assessment andcollection of tax shall have effect in relation to tax charged inaccordance with section 142A or section 450 as they have effect byvirtue of regulation 9.

• (2) The like provisions as are specified in the first column of Schedule1 to these Regulations shall have effect in relation thereto as if themodifications specified in the second column had been made.

Date for payment

4

• (1) Subject to paragraph (2)—

• (a) tax charged by an assessment on—

• (i) the profits or gains arising to a member from his underwritingbusiness, and

• (ii) syndicate investment income,

• shall be payable on or before 1st July 1992, and

• (b) tax charged by an assessment on syndicate gains shall be payable onor before 1st January 1992.

• (2) Tax charged by an assessment made less than 30 days before, orafter, the date specified in sub-paragraph (a) or (b) of paragraph (1)shall be payable at the expiration of a period of 30 days beginning withthe date of the issue of the notice of assessment.

Reasonable excuse

5

• (1) For the purposes of Schedule 19A, a managing agent shall be deemednot to have failed—

• (a) to deliver a return of a syndicate profit or loss within the timespecified in paragraph 2(2) of that Schedule[^f00007], or

• (b) to deliver a return apportioning a syndicate profit or loss withinthe period referred to in paragraph 7(3) of that Schedule[^f00008],

if he delivered it within such further time, if any, asthe inspector may have allowed.

• (2) For the purposes of paragraph 2B of Schedule 19A[^f00009] a members' agent shall be deemed not to have failed todeliver a return of the member’s profit within the time specified insub-paragraph (3) of that paragraph if he delivered it within suchfurther time, if any, as the inspector may have allowed.

• (3) Where a managing agent or a members' agent had a reasonable excusefor not delivering such a return as is mentioned in paragraph (1) or (2)he shall be deemed not to have failed to deliver it unless the excusehad ceased and, after the excuse ceased, not to have failed to deliverit if he did so without unreasonable delay after the excuse had ceased.

Determinations and notices of determinations

6

The like provisions as are contained in section 113(1B)[^f00010] and (3) of the Taxes Management Act 1970 shall apply toa determination or a notice of a determination under Schedule 19A as ifthe determination were an assessment and the notice of the determinationwere a notice of an assessment.

Error or mistake

7

• (1) If a members' agent alleges that a statement of the amount of taxpayable in the case of a member’s profit under paragraph 2B(1)(c) ofSchedule 19A was excessive because of some error or mistake in a returnmade by him under paragraph 2B(1) of that Schedule, he may by notice inwriting at any time not later than six years after the end of the yearof assessment 1990–91 make a claim to the Board for relief.

• (2) On receiving the claim the Board shall inquire into the matter andhaving regard to all the relevant circumstance of the case, but subjectto paragraph (3), give by way of repayment or otherwise such relief inrespect of the error or mistake as is reasonable and just.

• (3) No relief shall be given under this regulation in respect of anerror or mistake as to the basis on which a syndicate profit or loss, oras the case may be a member’s profit, ought to have been computed wherethe return was in fact made on the basis or in accordance with thepractice generally prevailing at the time when the return was made.

• (4) An appeal may be brought against the decision of the Board on theclaim, by giving written notice to the Board within 30 days of receiptof written notice of that decision and the Special Commissioners shallhear and determine the appeal in accordance with the principles to befollowed by the Board in determining claims under this regulation; andeither the appellant or the Board shall be entitled to require a case tobe stated under the like provisions as are contained in section 56 ofthe Taxes Management Act 1970[^f00011] but only on a point of law arising in connection withthe computation of the amount of tax payable in the case of the member'sprofit.

• (5) In this regulation“return” includes the documents referred to in paragraph 2B(1)(a) and (b) ofSchedule 19A.

Managing agents and members' agents

8

• (1) For the purposes of Schedule 19A and of these Regulations, if theperson who is acting as a managing agent or a members' agent in respectof the underwriting year corresponding to the year of assessment1988–89 is different from the person who was so acting at the endof that underwriting year (in this regulation referred to as“the original agent”), then“managing agent” and“members' agent” have the meanings given to them by sub-paragraph (a) or, as thecase may be, sub-paragraph (b) of paragraph (2).

• (2) If the original agent ceases to act—

• (a) before the beginning of the year of assessment 1991–92, then“managing agent” and“members' agent” mean—

• (i) the person who is so acting at the beginning of that year ofassessment, or

• (ii) if that person ceases so to act, such person as the Board maydetermine having regard to all the circumstances;

• (b) after the end of the year of assessment 1990–91, then“managing agent” and“members' agent” mean such person as the Board may determine having regard to allthe circumstances.

Extension of time limits—member and spouse

9

Where a claim or election or application falls to be made by amember or his spouse (or both) under a provision specified in the firstcolumn of Schedule 2 to these Regulations that provision shall haveeffect as if it imposed the extended time limit specified in the secondcolumn.

SCHEDULE 1

SCHEDULE 2

Signed

T. J. Painter — L. J. H. Beighton — Two of the Commissioners of Inland Revenue — 28th March 1991

Explanatory note

(This note is not part of the Regulations)

These Regulations, which have effect for the year of assessment1988–89 only, provide for the assessment and collection of taxcharged on underwriting members of Lloyd’s in accordance with section450 of the Income and Corporation Taxes Act 1988 (“section 450”), so far as not provided for by Schedule 19A to that Act (“Schedule 19A”), and section 142A of the Capital Gains Tax Act 1979 (“section 142A”). They provide for the determination in certain circumstances of theperson who is a managing agent in relation to a syndicate ofunderwriting members of Lloyd's, and a members' agent in relation to anunderwriting member, for the purposes of Schedule 19A and theseRegulations. They also provide for the extension of time limits forunderwriting members of Lloyd’s and their spouses to make claims,elections or applications under specified provisions of the Taxes Acts.

Regulation 1 provides for citation, commencement and effect andregulation 2 contains definitions.

Regulation 3 applies provisions corresponding to provisions in theTaxes Acts to the assessment and collection of tax charged in accordancewith sections 450 and 142A, with certain modifications specified inSchedule 1.

Regulation 4 provides dates on or before which tax charged by anassessment on underwriting profits and tax charged by an assessment onsyndicate gains is payable.

Regulation 5 provides that in the circumstances there specified amanaging agent shall be deemed not to have failed to comply withparagraph 2(2) or 7(3) of Schedule 19A and a members' agent shall bedeemed not to have failed to comply with paragraph 2B(2) of thatSchedule.

Regulation 6 provides that the like provisions to those in section113(1B) and (3) of the Taxes Management Act 1970 shall apply to adetermination or notice of a determination under Schedule 19A.

Regulation 7 provides for the giving of relief if the amount of taxpayable in the case of a member’s profit is alleged to be excessivebecause of an error or mistake in a return made by a members' agent.Regulation 8 adds to the definitions of“managing agent” and“members' agent” contained in paragraph 1(1) of Schedule 19A.

Regulation 9 provides for the extension of time limits in provisionsof the Taxes Acts specified in Schedule 2 where a claim, election orapplication is made by an underwriting member of Lloyd’s or his or herspouse.

Authority for the retrospective effect of these Regulations is givenby section 142A(6) of the 1979 Act, section 451(1A) of, and paragraph1(3) of Schedule 19A to, the 1988 Act and section 92(7) of the FinanceAct 1989.

Footnotes

[^f00001]: 1979 c. 14; section 142A was inserted by paragraph 24 ofSchedule 29 to the Income and Corporation Taxes Act 1988 (c. 1) andamended by sections 91(2) and 92(3) of, and Part VII of Schedule 17 to,the Finance Act 1989 (c. 26).

[^f00002]: 1988 c. 1; section 451(1) was amended by section 61(1)(b)of the Finance Act 1988 (c. 39) and section 451(1A) was inserted bysection 61(1)(c) of that Act and amended by section 92(1) of the FinanceAct 1989; Schedule 19A was inserted by section 58(4) of the Finance Act1988 and amended by sections 149(4)(a)(iii), 170(5), 179(1)(b)(iii) and187 of, and Parts VIII and X of Schedule 17 to, the Finance Act 1989 andby S.I. 1990/2524.

[^f00003]: 1989 c. 26.

[^f00004]: S.I. 1974/896, amended by S.I. 1974/1330.

[^f00005]: Section 450 was amended by sections 58(1), 59(1) and60(1) of the Finance Act 1988 (c. 39).

[^f00006]: 1970 c. 9.

[^f00007]: Paragraph 2 was substituted by S.I. 1990/2524.

[^f00008]: Paragraph 7 was amended by S.I. 1990/2524.

[^f00009]: Paragraph 2B was inserted by S.I. 1990/2524.

[^f00010]: Section 113(1B) was inserted by the Finance Act 1970(c.24), Schedule 4, paragraph 10.

[^f00011]: Section 56 was amended by the Finance (No. 2) Act 1975(c.45), section 45(3) and by the Finance Act 1984 (c. 43), section 127and Schedule 22, paragraph 6.