SCHEDULE 24 continued PART 2 continued
(2) In section 27 (offences by bodies corporate), for the words from “section 24” to “Schedule 4” substitute “paragraph 13(1) or (3) or 14(1) of Schedule 1 or paragraph 16 of Schedule 3”.
(3) In section 31 (protection of officers), for “remote gaming duty or the duty on amusement machine licences” substitute “or remote gaming duty”.
(4) In section 33 (interpretation), in subsection (2), for “remote gaming duty or the duty on amusement machine licences” substitute “or remote gaming duty”.
55 In section 102 of CEMA 1979, in subsection (3)(a), omit “or an amusement machine licence”.
56 In section 10 of FA 1997 (gaming duty), omit subsection (3A).
57 In Schedule 41 to FA 2008 (penalties: failure to notify and certain VAT and excise wrongdoing), in the Table in paragraph 1, omit the entry relating to amusement machine licence duty.
58 In section 7 of the Borders, Citizenship and Immigration Act 2009 (Customs revenue functions of the director), in subsection (2)(e), omit sub-paragraph (i).
59 (1) If a licence granted under section 21 of BGDA 1981 is to expire on or after the go-live date, the holder of the licence is entitled to repayment of an amount of duty.
(2) That amount is the difference between—
(a) the amount of duty actually paid on the licence before the go-live date in accordance with section 23 of that Act, and
(b) the amount (if less) determined in accordance with sub-paragraph (3).
(3) The amount is to be determined as follows—
Step 1
Calculate the amount of duty that would have been paid if the period for which the licence was granted had been the number of complete months beginning with the date on which the licence was granted and ending immediately before the go-live date. The day immediately following the end of that period of complete months is referred to as “day X”.
Step 2
Add to the amount calculated under Step 1 an amount representing the duty payable for the period of days beginning with day X and ending with the day before the go-live date. The duty payable for each such day in that period is to be calculated as 1/365th of the amount of duty payable for a licence of 12 months for a machine of the relevant category.
(4) If—
(a) duty is being paid on the licence in accordance with arrangements made under paragraph 7A of Schedule 4 to BGDA 1981 (payment of duty by instalments), and
(b) the amount of duty actually paid on the licence before the go-live date in accordance with section 23 of that Act is less than the amount determined in accordance with sub-paragraph (3),
the difference between those amounts is to be treated under that Act as unpaid duty.
(5) If a person entitled to a repayment of more than £10 under this paragraph has not received the repayment within the period of 90 days beginning with the go-live date—
(a) the person may give notice to HMRC of that fact,
(b) the Commissioners must pay interest to the person on the amount of the repayment for the period from the end of that 90-day period until the day on which the repayment is made, and
(c) any such interest accrues at the rate under section 197 of FA 1996 (rates of interest) that is applicable for Parts 2 and 3 of Schedule 3 to FA 2001 (excise duty payment by Commissioners in case of error or delay).
60 (1) If a licence granted or to be granted under section 21 of BGDA 1981 would expire within the period of 30 days ending with the go-live date, a person may apply—
(a) for the licence to be treated as extended for the necessary period, or
(b) for a new amusement machine licence to be treated as granted in its place under Schedule 4 to that Act for the necessary period.
(2) The necessary period is the period from expiry of the licence until immediately before the go-live date.
(3) An application under this paragraph may be made before or after the licence is granted but, if made after the licence is granted, it must be made before the day on which the licence is to expire.
(4) The application must be made to HMRC in such form and manner as HMRC may require.
(5) HMRC must grant the application once it has received payment of an amount of duty payable on the licence (or new licence) in respect of the necessary period.
(6) The amount of duty payable in respect of the necessary period is to be the sum of the amounts payable for each day in that period, each such amount being 1/365th of the duty payable for a licence of 12 months for a machine of the relevant category.
(7) Schedule 4 to BGDA 1981 and any regulations made under that Schedule apply (subject to any modifications specified by the Commissioners in a notice published for the purposes of this paragraph) to an amount of duty payable in accordance with this paragraph as to an amount of duty payable in accordance with section 23 of that Act.
(8) Nothing in this paragraph affects the operation of that Act with respect to the provision of amusement machines in the necessary period in a case where no application is made under this paragraph or an application is not granted.
(9) But if a default licence is granted under Schedule 4A to BGDA 1981 for the necessary period, the amount of duty that may be assessed under paragraph 4 of that Schedule is limited to the amount that would have been payable if an application had been made for a licence under this paragraph.
61 (1) This paragraph applies to licences to be granted under section 21 of BGDA 1981 on or after 2 January 2013 (a “final month licence”).
(2) Section 21(3) of that Act has effect as if—
(a) the requirement to grant amusement machine licences for a period of one or more whole months were omitted, and
(b) the power to grant amusement machine licences for a period not exceeding 12 months were a power to grant such licences for a period ending with a day that is no later than the day before the go-live date.
(3) The requirement in section 21(4) of that Act to grant special amusement machine licences for a period of 12 months has effect in relation to a final month licence as if it were a requirement to grant a licence for the period beginning with the date of grant and ending with the day before the go-live date.
(4) The amount of duty payable on a final month licence is to be calculated in the manner described in paragraph 60(6).
(5) The Commissioners may by notice direct that Schedules 4 and 4A to BGDA 1981 and any regulations made under those Schedules are to apply to a final month licence with such modifications as may be specified in the notice.
(6) A notice under sub-paragraph (5) must be published by the Commissioners.
62 (1) The enactments repealed by this Part of this Schedule continue to have effect on and after the go-live date in relation to the provision of amusement machines before that date.
(2) Enactments continuing to have effect by virtue of sub-paragraph (1) are to be read with any necessary modifications.
(3) Without prejudice to the generality of sub-paragraph (2), paragraph 4 of Schedule 4A to BGDA 1981 (assessment of amount equivalent to duty) is to
be read as if the reference in sub-paragraph (3) to the due date were a reference to the day before the go-live date.
63 For section 23 of VATA 1994 substitute—
(1) If a person plays a relevant machine game, then for the purposes of VAT the amount paid by the person is to be treated as consideration for a supply of services to that person.
(2) “Relevant machine game” is defined in section 23A.
(3) The value to be taken as the value of supplies made by a person (“the supplier”) in the circumstances mentioned in subsection (1) in any period is to be determined as if the consideration for the supplies were reduced by an amount equal to X.
(4) X is the amount (if any) paid out in that period by way of winnings in respect of relevant machine games made available by the supplier (whether the games were played in the same period or an earlier one).
(5) X does not include any winnings paid out to the supplier or a person acting on the supplier’s behalf.
(6) Inserting a token into a machine on which a relevant machine game is played is to be treated for the purposes of subsection (1) as the payment of an amount equal to that for which the token can be obtained.
(7) Providing a specified kind of token by way of winnings is to be treated for the purposes of subsection (4) as the payment out of an amount by way of winnings equal to the value of the token.
(8) A specified kind of token is—
(a) a token that can be inserted into the same machine to enable games to be played on the machine, or
(b) a token that is not of such a kind but can be exchanged for money.
(9) The value of a specified kind of token is—
(a) for a token within subsection (8)(a), an amount equal to that for which the token can be obtained, and
(b) for a token within subsection (8)(b), an amount equal to that for which the token can be exchanged.
(10) If it is not reasonably practicable to attribute payments and winnings to relevant machine games or to apportion them between relevant machine games and other games or other activities, any attribution or apportionment is to be done on a just and reasonable basis.
(11) For the purposes of this section, a person plays a game if the person participates in the game—
(a) whether or not there are other participants in the game, and
(b) whether or not a computer generates images or data taken to represent the actions of other participants in the game.
(1) A “relevant machine game” is a game (whether of skill or chance or both) that—
(a) is played on a machine for a prize, and
(b) is not excluded by subsection (2).
(2) A game is excluded by this subsection if—
(a) takings and payouts in respect of it are taken into account in determining any charge to machine games duty,
(b) it involves betting on future real events,
(c) bingo duty is charged on the playing of it or would be so charged but for paragraphs 1 to 5 of Schedule 3 to the Betting and Gaming Duties Act 1981 (exemptions from bingo duty),
(d) lottery duty is charged on the taking of a ticket or chance in it or would be so charged but for an express exception,
(e) it is a real game of chance and playing it amounts to dutiable gaming for the purposes of section 10 of the Finance Act 1997 or would do so but for subsection (3), (3B) or (4) of that section, or
(f) playing it amounts to remote gaming within the meaning of section 26A of the Betting and Gaming Duties Act 1981 (remote gaming duty: interpretation).
(3) In this section—
“game” does not include a sport;
“machine” means any apparatus that uses or applies mechanical power, electrical power or both;
“prize”, in relation to a game, does not include the opportunity to play the game again;
“real game of chance” means a game of chance (within the meaning of the Betting and Gaming Duties Act 1981) that is non-virtual.
(4) The Treasury may by order amend this section.”
64 (1) In Part 2 of Schedule 9 to that Act (exemptions: the groups), the provisions of Group 4 are amended as follows.
(2) After Item 1 insert—
“1A The provision of any facilities for the playing of dutiable machine games (as defined in Part 1 of Schedule 24 to the Finance Act 2012) but only to the extent that—
(a) the facilities are used to play such games, and
(b) the takings and payouts in respect of those games are taken into account in determining the charge to machine games duty.”
(3) In Note (1)—
(a) for “Item 1 does” substitute “Items 1 and 1A do”, and
(b) omit paragraph (d) and the word “or” immediately preceding that paragraph.
(4) After Note (1) insert—
“(1A) Item 1 does not apply to the provision of facilities to the extent that the facilities are used to play a relevant machine game (as defined in section 23A).”
(5) Accordingly—
(a) in Part 2 of Schedule 9, in the heading of Group 4, after “GAMING” insert “, DUTIABLE MACHINE GAMES”, and
(b) in Part 1 of that Schedule, in the Index, for “Betting, gaming and lotteries” substitute “Betting, gaming, dutiable machine games and lotteries”.
65 (1) Paragraph 9 of Schedule 11 to that Act (administration, collection and enforcement) is amended as follows.
(2) For paragraph (a) substitute—
“(a) to open any machine on which relevant machine games (as defined in section 23A) are capable of being played; and”.
(3) In paragraph (b), for “subsection (2) of that section” substitute “section 23(3)”.
(4) Accordingly, in the heading immediately before paragraph 9, for “gaming machines” substitute “machines on which relevant machine games are played”.
66 (1) The provisions of this Schedule have effect as follows.
(2) Part 1 has effect in relation to the playing of machine games on or after 1 February 2013 (and Schedules 55 and 56 to FA 2009, as amended by Part 1 of this Schedule, are taken to have come into force for the purposes of machine games duty on that date).
(3) Part 2 has effect in relation to the provision of amusement machines on or after 1 February 2013.
(4) Part 3 has effect in relation to supplies made on or after that date.
(5) A reference in this Schedule to the “go-live date” is to 1 February 2013.
67 (1) The Treasury may by regulations make transitional or saving provision in connection with the removal of amusement machine licence duty and the introduction of machine games duty.
(2) The power in sub-paragraph (1) is without prejudice to—
(a) the provision made by Part 2 of this Schedule, and
(b) any power in this Schedule apart from this paragraph to make transitional or saving provision in connection with the matters mentioned in sub-paragraph (1).
(3) Regulations under this paragraph are to be made by statutory instrument.
(4) A statutory instrument containing regulations under this paragraph is subject to annulment in pursuance of a resolution of the House of Commons.
Section 193
1 BGDA 1981 is amended as follows.
2 After section 5D insert—
(1) This section applies if a person (“P”) is liable to pay a qualifying foreign tax in respect of bets in respect of which P is also liable to pay general betting duty under a provision of sections 2 to 4 or section 5AB (“the relevant provision”).
(2) Bets in respect of which P is liable to pay both general betting duty under the relevant provision and the qualifying foreign tax are referred to as “eligible bets”.
(3) Credit may be allowed for all or part of the qualifying foreign tax paid by P.
(4) Whether any credit is allowed is determined in accordance with Schedule A1.
(5) If credit is allowed for an accounting period, P is entitled to claim a repayment of so much of the duty actually paid as is equal to the amount of credit allowed.
(6) Total repayments to P for that accounting period in respect of bets of the applicable class (taking into account all qualifying foreign taxes) must not, in aggregate, exceed the duty actually paid.
(7) “The applicable class” means the class of bets to which the relevant provision applies.
(8) “The duty actually paid” means the general betting duty paid by P for that accounting period in respect of bets of the applicable class.
(9) A bet does not count as an “eligible bet” if it was made by or on behalf of P.”
3 After section 8 insert—
(1) This section applies if a person (“P”) is liable to pay a qualifying foreign tax in respect of bets in respect of which P is also liable to pay pool betting duty.
(2) Bets in respect of which P is liable to pay both pool betting duty and the qualifying foreign tax are referred to as “eligible bets”.
(3) Credit may be allowed for all or part of the qualifying foreign tax paid by P.
(4) Whether any credit is allowed is determined in accordance with Schedule A1.
(5) If credit is allowed for an accounting period, P is entitled to claim a repayment of so much of the duty actually paid as is equal to the amount of credit allowed.
(6) Total repayments to P for that accounting period (taking into account all qualifying foreign taxes) must not, in aggregate, exceed the duty actually paid.
(7) “The duty actually paid” means the pool betting duty paid by P for that accounting period.
(8) A bet does not count as an “eligible bet” if it was made by or on behalf of P.”
4 After section 10 insert—
(1) For the purposes of general betting duty or pool betting duty, a “qualifying foreign tax” is a foreign tax specified by the Commissioners in relation to that duty (“the relevant duty”).
(2) “Specified” means specified in a notice published by the Commissioners, as revised or replaced from time to time.
(3) The Commissioners must specify a foreign tax under this section if they are satisfied that—
(a) it is a gambling tax,
(b) the activities on which it is charged include betting,
(c) the bets in respect of which it is charged include bets in respect of which the relevant duty is also charged, and
(d) the charge in respect of such bets is based on betting by persons in or deemed to be in the country or territory where the tax is imposed.
(4) The following factors indicate that a tax is a gambling tax—
(a) that it is charged on activities involving betting or gaming (rather than activities generally), and
(b) that it goes towards meeting general public expenditure (rather than being ring-fenced for a particular purpose).
(5) A notice specifying a foreign tax may provide that the tax is to be treated as having been specified with effect from a date that is earlier than the date of the notice.”
5 After section 26I insert—
(1) This section applies if—
(a) P is liable to pay remote gaming duty on the provision of facilities for remote gaming, and
(b) P is also liable to pay a qualifying foreign tax in respect of remote gaming using those facilities.
(2) The remote gaming using those facilities in respect of which the qualifying foreign tax is charged is referred to as “eligible gaming”.
(3) Credit may be allowed for all or part of the qualifying foreign tax paid by P.
(4) Whether any credit is allowed is determined in accordance with Schedule 4B.
(5) If credit is allowed for an accounting period, P is entitled to claim a repayment of so much of the duty actually paid as is equal to the amount of credit allowed.
(6) Total repayments to P for that period (taking into account all qualifying foreign taxes) must not, in aggregate, exceed the duty actually paid.
(7) “The duty actually paid” means the remote gaming duty paid by P for that accounting period.
(8) Remote gaming does not count as “eligible gaming” if one of the participants in the game in question is P or someone acting on P’s behalf.
(1) For the purposes of remote gaming duty, a “qualifying foreign tax” is a foreign tax specified by the Commissioners in relation to remote gaming duty.
(2) “Specified” means specified in a notice published by the Commissioners, as revised or replaced from time to time.
(3) The Commissioners must specify a foreign tax under this section if they are satisfied that—
(a) it is a gambling tax,
(b) the activities on which it is charged include remote gaming,
(c) the remote gaming on which it is charged includes remote gaming using facilities in respect of which remote gaming duty is also charged, and
(d) the charge is based on remote gaming by persons in or deemed to be in the country or territory where the tax is imposed.
(4) The following factors indicate that a tax is a gambling tax—
(a) that it is charged on activities involving betting or gaming (rather than activities generally), and
(b) that it goes towards meeting general public expenditure (rather than being ring-fenced for a particular purpose).
(5) A notice specifying a foreign tax may provide that the tax is to be treated as having been specified with effect from a date that is earlier than the date of the notice.
(1) The Commissioners may make regulations about—
(a) claims for repayment under section 26IA, and
(b) the making of repayments under that section.
(2) Regulations under this section may in particular include provision about—
(a) the time within which claims may be made,
(b) the form, content and delivery of claims,
(c) the evidence required to satisfy the Commissioners of the validity of claims, and
(d) the investigation and processing of claims.”
6 In section 33 (interpretation)—
(a) in subsection (1), after the definition of “the Commissioners” insert—
““foreign tax” means a tax, including any sort of duty or levy, imposed in a country or territory outside the United Kingdom (see also subsection (1B));”, and
(b) after subsection (1A) insert—
“(1B) A reference in this Act to a foreign tax does not include any penalty, interest, surcharge or other such cost arising in connection with the tax (whether or not recoverable as if it were that tax).”
7 Before Schedule 1 insert—
1 This Schedule sets out the rules for determining whether credit is allowed under section 5E or 8ZA for qualifying foreign tax paid by P.
2 (1) This Schedule is to be read as follows.
(2) “The applicable class”—
(a) in the case of section 5E, has the meaning given in that section, and
(b) in the case of section 8ZA, means dutiable pool bets.
(3) A “reconciliation period” is—
(a) if P has monthly accounting periods, a period consisting of 12 consecutive accounting periods,
(b) if P has quarterly accounting periods, a period consisting of 4 consecutive accounting periods, and
(c) if P has any other length of accounting period, a period consisting of such number of consecutive accounting periods as would produce a period as near as possible to 365 days.
(4) In relation to an accounting period, a reference to “the reconciliation period” is to the reconciliation period in which that accounting period falls.
3 (1) To determine whether credit is allowed for an accounting period—
(a) calculate the notional UK liability and the notional foreign liability for the accounting period, and
(b) compare the two figures.
(2) No credit is allowed if either figure is nil or both figures are nil.
(3) Subject to that, credit is allowed of an amount equal to the smaller of the two figures (or, if they are the same, of an amount equal to that figure).
4 The notional UK liability for an accounting period is calculated as follows—
Step 1
If the applicable class is a class to which a provision of sections 2 to 4 applies, calculate P’s net stake receipts for the period in accordance with section 5 but by reference to eligible bets (rather than bets of the applicable class).
If the applicable class is the class to which section 5AB applies, calculate the commission charges in accordance with that section relating to eligible bets determined in the period (rather than bets to which that section applies).
If the applicable class is dutiable pool bets, calculate P’s net pool betting receipts for the period in accordance with section 7A but by reference to eligible bets (rather than dutiable pool bets).
In calculating P’s net stake receipts or net pool betting receipts for the purposes of this Step, do not carry forward to the period any losses in respect of eligible bets that arose in an accounting period before the start of the reconciliation period.
Step 2
If the amount calculated under Step 1 is nil or a negative amount, the notional UK liability for the period is nil.
Otherwise, apply the appropriate rate to the amount calculated under Step 1. The result is the notional UK liability for the period.
“The appropriate rate” is the percentage specified in whichever of section 2(3), 3(3)(a), 3(3)(b), 4(3), 5AB(4) or 7(2) applies to the applicable class, as in force for the accounting period in question.
5 The notional foreign liability for an accounting period is calculated as follows—
Step 1
Calculate the amount of qualifying foreign tax that would be payable by P for the accounting period if the tax were charged solely in respect of eligible bets and accounted for by reference to periods corresponding to P’s accounting periods.
Any apportionment needed for this calculation is to be done on a just and reasonable basis.
If the law under which the qualifying foreign tax is imposed provides for losses to be carried forward, do not carry forward to the period any losses (in respect of eligible bets) that arose before the start of the reconciliation period.
Step 2
If the amount calculated under Step 1 is nil, the notional foreign liability for the period is nil.
Otherwise, calculate the sterling equivalent of the amount calculated under Step 1. The result is the notional foreign liability for the period.
The sterling equivalent is to be calculated using the London closing exchange rate for the last day of the accounting period.
6 (1) This paragraph applies if in respect of the applicable class of bets—
(a) P receives a repayment under section 5E or 8ZA for one or more accounting periods in a reconciliation period, and
(b) the amount calculated under Step 1 in paragraph 4 for the final accounting period in that reconciliation period is a negative amount.
(2) P is liable to repay all or part of the repayment or repayments received.
(3) The amount that P is liable to repay is the smallest of—
(a) the loss multiplied by the rate at which the qualifying foreign tax is charged in respect of eligible bets,
(b) the loss multiplied by the appropriate rate (as defined in paragraph 4) for the applicable class of bets, and
(c) the repayment (or the sum of the repayments) made to P for the reconciliation period.
(4) “The loss” means the negative amount mentioned in sub-paragraph (1)(b) but expressed as a positive number.
(5) If there is more than one rate at which the qualifying foreign tax is charged in respect of eligible bets, each rate is to be applied to an appropriate portion of the loss in order to arrive at the amount under sub-paragraph (3)(a).
(6) If all or part of the qualifying foreign tax is calculated other than on a net receipts basis, sub-paragraph (3) has effect as if paragraph (a) were omitted.
(7) Any amount due from P under this paragraph is to be treated as if it were an amount of unpaid general betting duty or, as the case may be, pool betting duty.
7 The Commissioners are not required to make a repayment under section 5E or 8ZA if P is in breach of any obligation to deliver a return with respect to—
(a) general betting duty,
(b) pool betting duty,
(c) bingo duty,
(d) remote gaming duty,
(e) gaming duty, or
(f) lottery duty.
8 (1) Sub-paragraphs (2) to (4) apply if any of the following events take place—
(a) the way in which a qualifying foreign tax is charged or calculated is changed retrospectively,
(b) a tax authority waives or refunds all or part of an amount of qualifying foreign tax due from P, or
(c) as a result of being liable to pay an amount of qualifying foreign tax, P or a connected person is entitled to any kind of tax deduction or relief calculated by reference to the amount of qualifying foreign tax.
(2) P must notify the Commissioners of the event on becoming aware of it.
(3) If the event is a retrospective change in the way in which the qualifying foreign tax is charged or calculated, the amount for which credit is allowed under section 5E or 8ZA is to be recalculated in accordance with this Schedule.
(4) In any other case, the amount for which credit is allowed under section 5E or 8ZA is to be reduced by a just and reasonable sum to reflect the amount of tax waived or refunded or the deduction or relief given.
(5) If it transpires (on account of this paragraph or otherwise) that a repayment or part of a repayment under section 5E or 8ZA should not have been made, P is liable for the amount that should not have been repaid, as if it were unpaid general betting duty or, as the case may be, pool betting duty.
(6) Section 1122 of the Corporation Tax Act 2010 (connected persons) applies for the purposes of sub-paragraph (1)(c).”
8 (1) Schedule 1 (betting duties) is amended as follows.
(2) In paragraph 2, after sub-paragraph (4) insert—
“(5) Regulations under this paragraph may also in particular include provision about claims for repayment under section 5E and about the making of any such repayment, including provision about—
(a) the time within which claims may be made,
(b) the form, content and delivery of claims,
(c) the evidence required to satisfy the Commissioners of the validity of claims, and
(d) the investigation and processing of claims.”
(3) In paragraph 2A, after sub-paragraph (3) insert—
“(4) Regulations under sub-paragraph (2) may also include provision about claims for repayment under section 8ZA and about the making of any such repayment, including provision about anything mentioned in paragraph 2(5)(a) to (d).”
9 After Schedule 4A insert—
1 This Schedule sets out the rules for determining whether credit is allowed under section 26IA for qualifying foreign tax paid by P.
2 (1) For the purposes of this Schedule, a “reconciliation period” is—
(a) if P has quarterly accounting periods, a period consisting of 4 consecutive accounting periods, and
(b) if P has any other length of accounting period, a period consisting of such number of consecutive accounting periods as would produce a period as near as possible to 365 days.
(2) In relation to an accounting period, a reference to “the reconciliation period” is to the reconciliation period in which that accounting period falls.
3 (1) To determine whether credit is allowed for an accounting period—
(a) calculate the notional UK liability and the notional foreign liability for the accounting period, and
(b) compare the two figures.
(2) No credit is allowed if either figure is nil or both figures are nil.
(3) Subject to that, credit is allowed of an amount equal to the smaller of the two figures (or, if they are the same, of an amount equal to that figure).
4 The notional UK liability for an accounting period is calculated as follows—
Step 1
Calculate P’s remote gaming profits for the period in accordance with section 26C(2) but by reference to the use of the facilities provided by P for eligible gaming (rather than remote gaming generally).
In calculating P’s remote gaming profits for the purposes of this Step, do not carry forward to the period any losses (in respect of the use of the facilities for eligible gaming) that arose in an accounting period before the start of the reconciliation period.
Step 2
If the amount calculated under Step 1 is nil or a negative amount, the notional UK liability for the period is nil.
Otherwise, apply the appropriate rate to the amount calculated under Step 1. The result is the notional UK liability for the period.
“The appropriate rate” is the percentage specified in section 26C(1) as in force for the accounting period in question.
5 The notional foreign liability for an accounting period is calculated as follows—
Step 1
Calculate the amount of qualifying foreign tax that would be payable by P for the accounting period if the tax were charged in respect of eligible gaming and were accounted for by reference to periods corresponding to P’s accounting periods.
Any apportionment needed for this calculation is to be done on a just and reasonable basis.
If the law under which the qualifying foreign tax is imposed provides for losses to be carried forward, do not carry forward to the period any losses (in respect of eligible gaming) that arose before the start of the reconciliation period.
Step 2
If the amount calculated under Step 1 is nil, the notional foreign liability for the period is nil.
Otherwise, calculate the sterling equivalent of the amount calculated under Step 1. The result is the notional foreign liability for the period.
The sterling equivalent is to be calculated using the London closing exchange rate for the last day of the accounting period.
6 (1) This paragraph applies if in respect of eligible gaming—
(a) P receives a repayment under section 26IA for one or more accounting periods in a reconciliation period, and
(b) the amount calculated under Step 1 in paragraph 4 for the final accounting period in that reconciliation period is a negative amount.
(2) P is liable to repay all or part of the repayment or repayments received.
(3) The amount that P is liable to repay is the smallest of—
(a) the loss multiplied by the rate at which the qualifying foreign tax is charged in respect of eligible gaming,
(b) the loss multiplied by the appropriate rate (as defined in paragraph 4), and
(c) the repayment (or the sum of the repayments) made to P for the reconciliation period.
(4) “The loss” means the negative amount mentioned in sub-paragraph (1)(b) but expressed as a positive number.
(5) If there is more than one rate at which the qualifying foreign tax is charged in respect of eligible gaming, each rate is to be applied to
an appropriate portion of the loss in order to arrive at the amount under sub-paragraph (3)(a).
(6) If all or part of the qualifying foreign tax is calculated other than on a net receipts basis, sub-paragraph (3) has effect as if paragraph (a) were omitted.
(7) Any amount due from P under this paragraph is to be treated as if it were an amount of unpaid remote gaming duty.
7 The Commissioners are not required to make a repayment under section 26IA if P is in breach of any obligation to deliver a return with respect to—
(a) general betting duty,
(b) pool betting duty,
(c) bingo duty,
(d) remote gaming duty,
(e) gaming duty, or
(f) lottery duty.
8 (1) Sub-paragraphs (2) to (4) apply if any of the following events take place—
(a) the way in which a qualifying foreign tax is charged or calculated is changed retrospectively,
(b) a tax authority waives or refunds all or part of an amount of qualifying foreign tax due from P, or
(c) as a result of being liable to pay an amount of qualifying foreign tax, P or a connected person is entitled to any kind of tax deduction or relief calculated by reference to the amount of qualifying foreign tax.
(2) P must notify the Commissioners of the event on becoming aware of it.
(3) If the event is a retrospective change in the way in which the qualifying foreign tax is charged or calculated, the amount for which credit is allowed under section 26IA is to be recalculated in accordance with this Schedule.
(4) In any other case, the amount for which credit is allowed under that section is to be reduced by a just and reasonable sum to reflect the amount of tax waived or refunded or the deduction or relief given.
(5) If it transpires (on account of this paragraph or otherwise) that a repayment or part of a repayment under section 26IA should not have been made, P is liable for the amount that should not have been repaid, as if it were unpaid remote gaming duty.
(6) Section 1122 of the Corporation Tax Act 2010 (connected persons) applies for the purposes of sub-paragraph (1)(c).”
10 In section 13A(2) of FA 1994 (meaning of “relevant decision”), after paragraph (g) insert—