|
| |
|
5 (1) | In section 563 (procedure for determining certain questions affecting two or |
| |
more persons), in subsection (1)(a) for “two” substitute “one”. |
| |
(2) | Accordingly, in the heading for that section for “two” substitute “one”. |
| |
Fixtures on which business premises renovation allowance has been made |
| |
6 | After section 186 insert— |
| 5 |
“186A | Fixtures on which a business premises renovation allowance has been |
| |
| |
(1) | This section applies if— |
| |
(a) | a person (“the past owner”) has at any time claimed an |
| |
allowance to which that person was entitled under Part 3A |
| 10 |
(business premises renovation allowances) in respect of |
| |
qualifying expenditure under that Part incurred in respect of |
| |
a qualifying building (“Part 3A expenditure”), |
| |
(b) | there has been a balancing event within section 360N(1) as a |
| |
result of which an asset representing the whole or part of the |
| 15 |
Part 3A expenditure (“the Part 3A asset”) ceased to be owned |
| |
| |
(c) | the Part 3A asset was or included plant or machinery, and |
| |
(d) | the current owner makes a claim under this Part in respect of |
| |
expenditure (“new expenditure”) incurred— |
| 20 |
(i) | on the provision of the plant or machinery, and |
| |
(ii) | at a time when it is a fixture. |
| |
(2) | If the new expenditure exceeds the maximum allowable amount, the |
| |
excess is to be left out of account in determining the current owner’s |
| |
| 25 |
(3) | If the proceeds from the balancing event mentioned in subsection |
| |
(1)(b) exceed R, the maximum allowance amount is— |
| |
| |
| F is so much of the proceeds from the balancing event as are |
| |
attributable to the fixture, |
| 30 |
| T is the total amount of the proceeds from the balancing |
| |
| |
| R is the qualifying expenditure incurred by the past owner on |
| |
the Part 3A asset less the net Part 3A allowances in respect of |
| |
| 35 |
(4) | Where subsection (3) does not apply, the maximum allowable |
| |
amount is so much of the proceeds from the balancing event as are |
| |
attributable to the fixture. |
| |
(5) | For the purposes of subsection (3) the “net Part 3A allowances” in |
| |
respect of the Part 3A asset means— |
| 40 |
(a) | the total of any allowances made under Part 3A in respect of |
| |
the past owner’s qualifying expenditure, less |
| |
(b) | the total of any balancing charges made under that Part in |
| |
respect of that expenditure. |
| |
|
| |
|
| |
|
(6) | For the purposes of this section, the current owner of the plant or |
| |
| |
(a) | the person who acquired the Part 3A asset from the past |
| |
| |
(b) | any person who is subsequently treated as the owner of the |
| 5 |
| |
7 | In section 9 (interaction between fixtures claims and other claims), in |
| |
| |
(a) | in paragraph (a), after “Part 3” insert “, 3A”, and |
| |
(b) | in paragraph (b), after “section 186(2)” insert “, 186A(2)”. |
| 10 |
8 | In section 57 (available qualifying expenditure), in subsection (3), after |
| |
“section 186(2)” insert “, 186A(2)”. |
| |
9 | In section 198 (election to apportion sale price on sale of qualifying interest), |
| |
for subsection (5)(a) substitute— |
| |
“(a) | sections 186, 186A and 187 (fixtures on which industrial |
| 15 |
buildings allowance, business premises renovation |
| |
allowance or research and development allowance has been |
| |
| |
10 | In section 199 (election to apportion capital sum given by lessee on grant of |
| |
lease), for subsection (5)(a) substitute— |
| 20 |
“(a) | sections 186, 186A and 187 (fixtures on which industrial |
| |
buildings allowance, business premises renovation |
| |
allowance or research and development allowance has been |
| |
| |
Commencement and transitionals |
| 25 |
11 | The amendments made by paragraphs 2 to 5 have effect— |
| |
(a) | for income tax purposes, in relation to new expenditure incurred on |
| |
or after 6 April 2012, and |
| |
(b) | for corporation tax purposes, in relation to new expenditure incurred |
| |
on or after 1 April 2012. |
| 30 |
12 | The amendments made by paragraph 6 to 10 have effect— |
| |
(a) | for income tax purposes, in relation to balancing events which occur |
| |
on or after 6 April 2012, and |
| |
(b) | for corporation tax purposes, in relation to balancing events which |
| |
occur on or after 1 April 2012. |
| 35 |
13 (1) | Where (ignoring this sub-paragraph) plant or machinery would be treated |
| |
for the purposes of subsection (1)(b) of section 187A of CAA 2001 as having |
| |
been owned by a person for a period which began and ended before the |
| |
commencement date, that period of ownership is, for those purposes, to be |
| |
regarded as not occurring at a relevant earlier time. |
| 40 |
(2) | Section 187A(3)(a) of CAA 2001 (imposition of the pooling requirement) |
| |
does not apply if the period for which the plant or machinery is treated as |
| |
having been owned by the past owner as a result of incurring the historic |
| |
expenditure ends no later than the end of the period of 2 years beginning |
| |
with the commencement date. |
| 45 |
(3) | “The commencement date” means— |
| |
|
| |
|
| |
|
(a) | for income tax purposes, 6 April 2012, and |
| |
(b) | for corporation tax purposes, 1 April 2012. |
| |
| |
| |
Expenditure on plant and machinery for use in designated assisted areas |
| |
1 | CAA 2001 is amended as follows. |
| 5 |
2 | In section 39 (first-year allowances available for certain types of qualifying |
| |
expenditure only), at the appropriate place in the list insert— |
| |
| | | | | | | machinery for use in designated |
| | | | | | | 10 |
|
3 | After section 45J insert— |
| |
“45K | Expenditure on plant and machinery for use in designated assisted |
| |
| |
(1) | Expenditure is first-year qualifying expenditure if— |
| |
(a) | it is incurred by a company on the provision of plant or |
| 15 |
machinery for use primarily in an area which at the time the |
| |
expenditure is incurred is a designated assisted area, |
| |
(b) | it is incurred in the period of 5 years beginning with 1 April |
| |
| |
(c) | Conditions A to E are met. |
| 20 |
(2) | “Designated assisted area” means an area which— |
| |
(a) | is designated by an order made by the Treasury, and |
| |
(b) | falls wholly within an assisted area. |
| |
(3) | An area may be designated by an order under subsection (2)(a) only |
| |
if at the time the order is made— |
| 25 |
(a) | the area falls wholly within an enterprise zone, and |
| |
(b) | a memorandum of understanding, in respect of the area, |
| |
relating to the availability of allowances in respect of |
| |
expenditure to which this section applies has been entered |
| |
into by the Treasury and the responsible authority for the |
| 30 |
| |
(4) | An order made under subsection (2)(a) may provide that an area |
| |
designated by the order is to be treated as having been so designated |
| |
at times falling before the order is made. |
| |
(5) | But where an area has previously been designated by an order under |
| 35 |
subsection (2)(a), section 14 of the Interpretation Act 1978 does not |
| |
apply, by virtue of subsection (4), so as to imply a power to make an |
| |
order (“the new order”) treating that area (or any part of it) as if it |
| |
were not so designated at times falling before the new order is made. |
| |
|
| |
|
| |
|
(6) | Condition A is that the company is within the charge to corporation |
| |
| |
(7) | Condition B is that the expenditure is incurred for the purposes of a |
| |
qualifying activity within section 15(1)(a) or (f). |
| |
(8) | Condition C is that the expenditure is incurred for the purposes of— |
| 5 |
(a) | a business of a kind not previously carried on by the |
| |
| |
(b) | expanding a business carried on by the company, or |
| |
(c) | starting up an activity which relates to a fundamental change |
| |
in a product or production process of, or service provided by, |
| 10 |
a business carried on by the company. |
| |
(9) | Condition D is that the plant or machinery is unused and not second- |
| |
| |
(10) | Condition E is that the expenditure is not replacement expenditure. |
| |
(11) | “Replacement expenditure” means expenditure incurred on the |
| 15 |
provision of plant or machinery (“new plant or machinery”) |
| |
intended to perform the same or a similar function, for the purposes |
| |
of the qualifying activity of the company, as other plant or machinery |
| |
(“replaced plant or machinery”)— |
| |
(a) | on which the company has previously incurred qualifying |
| 20 |
| |
(b) | which has been superseded by the new plant or machinery. |
| |
(12) | But if and to the extent that— |
| |
(a) | the expenditure is incurred on the provision of new plant or |
| |
machinery that is capable of and intended to perform a |
| 25 |
significant additional function, when compared to the |
| |
replaced plant or machinery, and |
| |
(b) | the additional function enhances the capacity or productivity |
| |
of the qualifying activity in question, |
| |
| so much of the expenditure as is attributable to the additional |
| 30 |
function is not to be regarded as replacement expenditure. |
| |
(13) | The part of the expenditure attributable to the additional function is |
| |
to be determined on a just and reasonable basis. |
| |
| |
| 35 |
(a) | an area specified as a development area under section |
| |
1 of the Industrial Development Act 1982, or |
| |
| |
“enterprise zone” means an area recognised by the Treasury as |
| |
an area in respect of which there is a special focus on |
| 40 |
economic development and identified on a map published by |
| |
the Treasury for the purposes of this section; |
| |
“the responsible authority”, for an area, means— |
| |
(a) | if the area is in England, a local authority for all or |
| |
part of the area or two or more such local authorities, |
| 45 |
(b) | if the area is in Scotland, the Scottish Ministers, |
| |
(c) | if the area is in Wales, the Welsh Ministers, and |
| |
|
| |
|
| |
|
(d) | if the area is in Northern Ireland, the Department of |
| |
Enterprise, Trade and Investment in Northern |
| |
| |
(15) | The Treasury may by order amend the definition of “assisted area” |
| |
in subsection (14) in consequence of any changes made to the areas |
| 5 |
in the United Kingdom granted assisted area status by virtue of |
| |
Article 107(3) of the Treaty on the Functioning of the European |
| |
| |
(16) | This section is subject to— |
| |
section 45L (plant or machinery partly for use outside |
| 10 |
designated assisted areas), |
| |
section 45M (exclusions from section 45K allowances), |
| |
section 45N (effect of plant or machinery subsequently being |
| |
primarily used in an area other than a designated assisted |
| |
| 15 |
section 46 (general exclusions). |
| |
45L | Exclusion of plant or machinery partly for use outside designated |
| |
| |
(1) | Expenditure on plant or machinery is not first-year qualifying |
| |
expenditure under section 45K if— |
| 20 |
(a) | at the time when it is incurred, the company incurring it |
| |
intends the plant or machinery to be used partly in a non- |
| |
| |
(b) | the main purpose, or one of the main purposes, for which any |
| |
person is a party to the relevant arrangements is the |
| 25 |
obtaining of a first-year allowance, or a greater first-year |
| |
allowance, in respect of the part of the expenditure that is |
| |
attributable to that intended use in a non-designated area. |
| |
(2) | For the purposes of subsection (1)(b), the part of the expenditure that |
| |
is attributable to that intended use in a non-designated area is to be |
| 30 |
determined on a just and reasonable basis. |
| |
| |
“non-designated area” means an area which is not a designated |
| |
assisted area within the meaning of section 45K; |
| |
“the relevant arrangements” means— |
| 35 |
(a) | the transaction under which the expenditure is |
| |
| |
(b) | any scheme or arrangements of which that |
| |
| |
45M | Exclusions from allowances under section 45K |
| 40 |
(1) | Expenditure incurred by a person is not first-year qualifying |
| |
expenditure under section 45K if it is within subsection (2), (4), (6) or |
| |
| |
(2) | Expenditure is within this subsection if, at the time a claim is made |
| |
under section 3 for a section 45K allowance in respect of the |
| 45 |
expenditure, the person who incurred the expenditure is, or forms |
| |
part of, an undertaking within subsection (3). |
| |
|
| |
|
| |
|
(3) | An undertaking is within this subsection if one or both of the |
| |
following conditions are met— |
| |
(a) | it is reasonable to assume that the undertaking would be |
| |
regarded as a firm in difficulty for the purposes of the |
| |
Community Guidelines on State Aid for Rescuing and |
| 5 |
Restructuring Firms in Difficulty (2004/C 244/02); |
| |
(b) | the undertaking is subject to an outstanding recovery order |
| |
made by virtue of Article 108(2) of the Treaty on the |
| |
Functioning of the European Union (Commission Decision |
| |
declaring aid illegal and incompatible with the common |
| 10 |
| |
(4) | Expenditure is within this subsection if it is incurred for the purposes |
| |
of a qualifying activity— |
| |
(a) | in the fishery or aquaculture sector, as covered by Council |
| |
Regulation (EC) No 104/2000, |
| 15 |
(b) | in the coal sector, steel sector, shipbuilding sector or synthetic |
| |
| |
(c) | relating to the management of waste of undertakings, or |
| |
| |
(i) | the primary production of agricultural products, |
| 20 |
(ii) | on-farm activities necessary for preparing an animal |
| |
or plant product for the first sale, or |
| |
(iii) | the first sale of agricultural products by a primary |
| |
producer to wholesalers, retailers or processors, in |
| |
circumstances where that sale does not take place on |
| 25 |
separate premises reserved for that purpose. |
| |
(5) | In subsection (4)(c) the reference to waste of undertakings does not |
| |
include waste of the person who incurred the expenditure or of any |
| |
other person forming part of the same undertaking as that person. |
| |
(6) | Expenditure is within this subsection if it is incurred on a means of |
| 30 |
transport or transport equipment for the purposes of a qualifying |
| |
activity in the road freight sector or the air transport sector. |
| |
(7) | Expenditure is within this subsection if a relevant grant or relevant |
| |
| |
| 35 |
(b) | any other expenditure which is incurred by any person in |
| |
respect of the same designated assisted area, and on the same |
| |
single investment project, as that expenditure. |
| |
(8) | A section 45K allowance made in respect of first-year qualifying |
| |
expenditure is to be withdrawn if— |
| 40 |
(a) | after it is made, a relevant grant or relevant payment is made |
| |
towards that expenditure, or |
| |
(b) | within the period of 3 years beginning when that expenditure |
| |
was incurred, a relevant grant or relevant payment is made |
| |
towards any other expenditure which is incurred by any |
| 45 |
person in respect of the same designated assisted area, and on |
| |
the same single investment project, as that expenditure. |
| |
(9) | All such assessments and adjustments of assessments are to be made |
| |
as are necessary to give effect to subsection (8). |
| |
|
| |
|
| |
|
(10) | If a person who has made a return becomes aware that, after making |
| |
it, anything in it has become incorrect because of the operation of this |
| |
section, that person must give notice to an officer of Revenue and |
| |
Customs specifying how the return needs to be amended. |
| |
(11) | The notice must be given within 3 months beginning with the day on |
| 5 |
which the person first became aware that anything in the return had |
| |
become incorrect because of the operation of this section. |
| |
| |
“agricultural product”, “coal sector”, “steel sector”, |
| |
“shipbuilding sector” and “synthetic fibres sector” have the |
| 10 |
same meaning as in the General Block Exemption Regulation; |
| |
“General Block Exemption Regulation” means Commission |
| |
Regulation (EC) No 800/2008 (General block exemption |
| |
| |
“management” and “waste” have the meaning given by Article |
| 15 |
1 of Directive 2006/12/EC of the European Parliament and of |
| |
| |
“relevant grant or relevant payment” means a grant or payment |
| |
| |
(a) | a State aid, other than an allowance under this Part, or |
| 20 |
(b) | a grant or subsidy, other than a State aid, which the |
| |
Treasury by order declares to be relevant for the |
| |
purposes of the witholding of a section 45K |
| |
| |
“section 45K allowance” means a first-year allowance in respect |
| 25 |
of expenditure that is first-year qualifying expenditure under |
| |
| |
“single investment project” has the same meaning as in the |
| |
General Block Exemption Regulation; |
| |
| 30 |
(a) | an autonomous enterprise, or |
| |
(b) | an enterprise (not within paragraph (a)) and its |
| |
partner enterprises (if any) and its linked enterprises |
| |
| |
and for this purpose “enterprise”, “autonomous enterprise”, |
| 35 |
“partner enterprises” and “linked enterprises” have the |
| |
meaning given by Annex 1 to the General Block Exemption |
| |
| |
(13) | Nothing in this section limits references to “State aid” to State aid |
| |
which is required to be notified to and approved by the European |
| 40 |
| |
(14) | For the purposes of this section references to expenditure incurred in |
| |
respect of a designated assisted area includes expenditure incurred |
| |
on the provision of things for use primarily in that area or on services |
| |
to be provided primarily in that area. |
| 45 |
(15) | The Treasury may by order make such provision amending this |
| |
section as appears to them appropriate for the purpose of giving |
| |
effect to any future amendments of or instruments replacing— |
| |
(a) | the General Block Exemption Regulation, |
| |
|
| |
|