Finance (No. 4) Bill (HC Bill 325)

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
5respect 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
10provides 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
15liability 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
20closing exchange rate for the last day of the accounting period.

Clawback

(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) 25the 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) 30The 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) 35the 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
40charged 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
5(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.

Breach of return obligations

7 The Commissioners are not required to make a repayment under
10section 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) 15remote gaming duty,

(e) gaming duty, or

(f) lottery duty.

Reduction etc in foreign tax paid

(1) Sub-paragraphs (2) to (4) apply if any of the following events take
20place—

(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) 25as 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
30of 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) 35In 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
40repayment 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).”

Consequential amendments

10 In section 13A(2) of FA 1994 (meaning of “relevant decision”), after
paragraph (g) insert—

“(ga) any decision by HMRC as to whether or not any person is
5entitled to any repayment under section 5E, 8ZA or 26IA of
the Betting and Gaming Duties Act 1981 (double taxation
relief), or the amount of the repayment to which any person
is so entitled;”.

(1) The Table in paragraph 1 of Schedule 41 to FA 2008 (penalties: failure to
10notify and certain VAT and excise wrongdoing) is amended as follows.

(2) In the second column of the entry for general betting duty, for “paragraph
4(1) to (3) of Schedule 1 to BGDA 1981” substitute “paragraph 8(2) of
Schedule A1 to BGDA 1981 (obligation to notify reduction etc in qualifying
foreign tax) or paragraph 4(1) to (3) of Schedule 1 to that Act”.

(3) 15In the second column of the entry for pool betting duty, for “paragraphs 4(2)
and 5(1) of Schedule 1 to BGDA 1981” substitute “paragraph 8(2) of Schedule
A1 to BGDA 1981 (obligation to notify reduction etc in qualifying foreign
tax) or paragraphs 4(2) and 5(1) of Schedule 1 to that Act”.

(4) In the second column of the entry for remote gaming duty, for “to register
20under regulations under section 26J of BGDA 1981” substitute “to notify
under paragraph 8(2) of Schedule 4B to BGDA 1981 (reduction etc in
qualifying foreign tax) and obligation to register under regulations under
section 26J of that Act”.

Commencement

12 25The amendments made by this Schedule have effect in relation to accounting
periods ending on or after 1 April 2012 (and, accordingly, the first
reconciliation period begins with the first accounting period in relation to
which the amendments have effect).

Section 195

SCHEDULE 26 30Anti-forestalling charge to VAT

Part 1 Anti-forestalling charge to VAT

Introductory

(1) Paragraph 2 applies where—

(a) 35there is a change in the descriptions of exempt or zero-rated supplies
as a result of an order under section 30(4) or 31(2) of VATA 1994,

(b) the order is expressed to come into force on 1 October 2012, and

(c) the change relates to supplies of a description specified in paragraph
3.

(2) 40In this Schedule—

Finance (No. 4) BillPage 573

• “date of the VAT change” means 1 October 2012;

• “pre-change supply” means a supply which—

  (a)

  is treated as taking place before the date of the VAT change,
  and

  (b)

  5if it had been treated as taking place on that date, would have
  been charged to VAT at the standard rate as a result of the
  order.

The charge

(1) There is an anti-forestalling charge to value added tax on any pre-change
10supply which—

(a) is treated as taking place on or after 21 March 2012, and

(b) is a supply linked to the post-change period (see paragraph 4).

(2) “Chargeable pre-change supply” means a supply to which sub-paragraph
(1) applies.

(3) 15An anti-forestalling charge to value added tax under this Schedule is to be
treated for all purposes as if it were value added tax charged in accordance
with VATA 1994.

The supplies

(1) The descriptions of supplies are—

(a) 20the supply, in the course of an approved alteration of a protected
building, of any services, other than the services of an architect,
surveyor or any person acting as consultant or in a supervisory
capacity,

(b) the supply of building materials to a person to whom the supplier is
25supplying services within paragraph (a) which include the
incorporation of the materials into the building (or its site),

(c) the grant of facilities for the self storage of goods, or

(d) the grant of a right to receive a supply within paragraph (c).

(2) The Notes to Group 6 in Schedule 8 to VATA 1994 have effect for the
30purposes of sub-paragraph (1)(a) and (b) as they had effect for the purposes
of items 1 to 3 of that Group on 21 March 2012.

(3) For the purposes of this Schedule a right to receive a supply includes—

(a) any option to receive that supply, and

(b) any interest deriving from such an option.

35Supplies linked to the post-change period

(1) A supply of services within paragraph 3(1)(a) or (c) is linked to the post-
change period if, and to the extent that, the services are carried out or
provided on or after the date of the VAT change.

(2) A supply of goods within paragraph 3(1)(b) is linked to the post-change
40period if, and to the extent that, the goods are incorporated into the building
concerned (or its site) on or after that date.

(3) A supply within paragraph 3(1)(d) is linked to the post-change period if, and
to the extent that, the services to which the grant relates are carried out or
provided on or after that date.

Power to modify this Schedule

(1) 5The Treasury may by order modify this Schedule for the purposes of
preventing an anti-forestalling charge from arising, in the circumstances
specified in the order, in relation to any description of supplies specified in
the order.

(2) An order under this paragraph may contain provision having retrospective
10effect.

(3) An order under this paragraph is to be made by statutory instrument.

(4) A statutory instrument containing an order under this paragraph is subject
to annulment in pursuance of a resolution of the House of Commons.

Part 2 15Liability and amount

Liability

(1) An anti-forestalling charge under this Schedule on a chargeable pre-change
supply—

(a) is a liability of the supplier (subject to sub-paragraph (2)), and

(b) 20becomes due on the date of the VAT change (rather than at the time
of supply).

(2) If, on the date on which the anti-forestalling charge becomes due, the person
who would be liable to pay the charge under sub-paragraph (1)—

(a) is not a taxable person, but

(b) 25is treated as a member of a group under sections 43A to 43D of VATA
1994,

the anti-forestalling charge is a liability of the representative member of the
group.

Amount

(1) 30The amount of the anti-forestalling charge on a chargeable pre-change
supply is the amount of VAT that would be chargeable on the supply if it
were subject to VAT at 20%.

(2) If the chargeable pre-change supply is not wholly linked to the post-change
period, the anti-forestalling charge is the relevant proportion of that amount.

(3) 35The relevant proportion is—

Part 3 5Administration and interpretation

Person ceasing to be taxable person before anti-forestalling charge due

(1) This paragraph applies if, on the date on which an anti-forestalling charge
under this Schedule becomes due (“the due date”), the person who is liable
to pay the charge under paragraph 6 is not a taxable person.

(2) 10The anti-forestalling charge must be accounted for by that person in
accordance with VATA 1994 (and regulations made under that Act) as if it
were VAT due in the last period for which the person was required to make
a return by or under VATA 1994.

(3) If an amount assessed as due by way of an anti-forestalling charge under this
15Schedule would (in the absence of this sub-paragraph) carry interest from a
date earlier than the due date, it is to be treated as only carrying interest from
the due date.

Adjustment of contracts following the VAT change

(1) This paragraph applies where—

(a) 20a contract for the supply of goods or services is made before the date
of the VAT change, and

(b) there is an anti-forestalling charge under this Schedule on the
supply.

(2) The consideration for the supply is to be increased by an amount equal to the
25anti-forestalling charge, unless the contract provides otherwise.

Invoices

10 Regulations under paragraph 2A of Schedule 11 to VATA 1994 (VAT
invoices) may make provision about the provision, replacement or
correction of invoices in connection with an anti-forestalling charge under
30this Schedule.

Interpretation: general

(1) Expressions used in this Schedule and in VATA 1994 have the same meaning
in this Schedule as in that Act.

(2) In this Schedule “treated as taking place” means treated as taking place for
35the purposes of the charge to VAT.

Section 201

SCHEDULE 27 Non-established taxable persons

New Schedule 1A

1 In VATA 1994, after Schedule 1 insert—

“Schedule 1A 5Registration in respect of taxable supplies: non-uk establishment

Liability to be registered

(1) A person becomes liable to be registered under this Schedule at
any time if conditions A to D are met.

(2) Condition A is that—

(a) 10the person makes taxable supplies, or

(b) there are reasonable grounds for believing that the person
will make taxable supplies in the period of 30 days then
beginning.

(3) Condition B is that those supplies (or any of them) are or will be
15made in the course or furtherance of a business carried on by the
person.

(4) Condition C is that the person has no business establishment, or
other fixed establishment, in the United Kingdom in relation to
any business carried on by the person.

(5) 20Condition D is that the person is not registered under this Act.

(1) A person does not become liable to be registered by virtue of
paragraph 1(2)(b) if the reason for believing that taxable supplies
will be made in the 30-day period mentioned there is that a
business, or part of a business, carried on by a taxable person is to
25be transferred to the person as a going concern in that period.

(2) But if the transfer takes place, the transferee becomes liable to be
registered under this Schedule at the time of the transfer if
conditions A to D in paragraph 1 are met in relation to the
transferee at that time.

(3) 30In determining for the purposes of sub-paragraph (2) whether
condition B is met, the reference in paragraph 1(3) to a business is
to be read as a reference to the business, or part of the business,
that is transferred to the transferee.

3 A person is treated as having become liable to be registered under
35this Schedule at any time when the person would have become so
liable under paragraph 1 or 2 but for any registration that is
subsequently cancelled under—

(a) paragraph 11,

(b) paragraph 13(3) of Schedule 1,

(c) 40paragraph 6(2) of Schedule 2,

(d) paragraph 6(3) of Schedule 3, or

(e) paragraph 6(2) of Schedule 3A.

(1) A person does not cease to be liable to be registered under this
Schedule except in accordance with sub-paragraph (2).

(2) A person who has become liable to be registered under this
5Schedule ceases to be so liable at any time if the Commissioners
are satisfied that—

(a) the person has ceased to make taxable supplies in the
course or furtherance of a business carried on by the
person, or

(b) 10the person is no longer a person in relation to whom
condition C in paragraph 1 is met.

Notification of liability and registration

(1) A person who becomes liable to be registered by virtue of
paragraph 1(2)(a) or 2(2) must notify the Commissioners of the
15liability before the end of the period of 30 days beginning with the
day on which the liability arises.

(2) The Commissioners must register any such person (whether or not
the person so notifies them) with effect from the beginning of the
day on which the liability arises.

(1) 20A person who becomes liable to be registered by virtue of
paragraph 1(2)(b) must notify the Commissioners of the liability
before the end of the period by reference to which the liability
arises.

(2) The Commissioners must register any such person (whether or not
25the person so notifies them) with effect from the beginning of the
period by reference to which the liability arises.

Notification of end of liability

(1) A person registered under paragraph 5 or 6 who, on any day,
ceases to make or have the intention of making taxable supplies in
30the course or furtherance of a business carried on by that person
must notify the Commissioners of that fact within 30 days
beginning with that day.

(2) But the person need not notify the Commissioners if on that day
the person would otherwise be liable or entitled to be registered
35under this Act (disregarding for this purpose the person’s
registration under this Schedule and any enactment that prevents
a person from being liable to be registered under different
provisions at the same time).

Cancellation of registration

(1) 40The Commissioners must cancel a person’s registration under this
Schedule if—

(a) the person satisfies them that the person is not liable to be
registered under this Schedule, and

(b) the person requests the cancellation.

(2) The cancellation is to be made with effect from—

(a) the day on which the request is made, or

(b) such later day as may be agreed between the
Commissioners and the person.

(3) 5But the Commissioners must not cancel the registration with effect
from any time unless they are satisfied that it is not a time when
the person would be subject to a requirement to be registered
under this Act.

(1) The Commissioners may cancel a person’s registration under this
10Schedule if they are satisfied that the person has ceased to be liable
to be registered under this Schedule.

(2) The cancellation is to be made with effect from—

(a) the day on which the person ceased to be so liable, or

(b) such later day as may be agreed between the
15Commissioners and the person.

(3) But the Commissioners must not cancel the registration with effect
from any time unless they are satisfied that it is not a time when
the person would be subject to a requirement, or entitled, to be
registered under this Act.

10 20In determining for the purposes of paragraphs 8 and 9 whether a
time is a time when a person would be subject to a requirement, or
entitled, to be registered under this Act, so much of any provision
of this Act as prevents a person from becoming liable or entitled to
be registered when the person is already registered or when the
25person is so liable under any other provision must be disregarded.

(1) The Commissioners may cancel a person’s registration under this
Schedule if they are satisfied that the person was not liable to be
registered under this Schedule on the day on which the person
was registered.

(2) 30The cancellation is to be made with effect from the day on which
the person was registered.

12 Paragraphs 8 to 11 are subject to paragraph 18 of Schedule 3B
(cancellation of registration under this Schedule of persons
seeking to be registered under that Schedule etc).

35Exemption from registration

(1) The Commissioners may exempt a person from registration under
this Schedule if the person satisfies them that the taxable supplies
that the person makes or intends to make—

(a) are all zero-rated, or

(b) 40would all be zero-rated if the person were a taxable person.

(2) The power in sub-paragraph (1) is exercisable only if the person so
requests and the Commissioners think fit.

(3) If there is a material change in the nature of the supplies made by
a person exempted under this paragraph, the person must notify
45the Commissioners of the change—

(a) within 30 days beginning with the day on which the
change occurred, or

(b) if no particular day is identifiable as that day, within 30
days of the end of the quarter in which the change
5occurred.

(4) If it appears to the Commissioners that a request under this
paragraph should no longer be acted upon on or after any day or
has been withdrawn on any day, they must register the person
who made the request with effect from that day.

(5) 10A reference in this paragraph to supplies is to supplies made in the
course or furtherance of a business carried on by the person.

Supplementary

14 Any notification required under this Schedule must be made in
such form and manner and must contain such particulars as may
15be specified in regulations or by the Commissioners in accordance
with regulations.”

Other amendments of VATA 1994

2 VATA 1994 is amended as follows.

3 In section 7 (place of supply of goods), in subsection (4)(c)(ii), after
20“Schedule 1” insert “or 1A”.

4 In section 54 (farmers etc), in subsection (2), after “Schedule 1” insert “or is,
has become or has ceased to be liable to be registered under Schedule 1A”.

5 In section 55 (customers to account for tax on supplies of gold etc), in
subsection (1)—

(a) 25for “Schedule 1” substitute “Schedules 1 and 1A”, and

(b) for “that Schedule” substitute “Schedule 1”.

6 In section 55A (customers to account for tax on supplies of goods or services
of a kind used in missing trader intra-community fraud), in subsection (3),
for “Schedule 1” substitute “Schedules 1 and 1A”.

7 30In section 69 (breaches of regulatory provisions), in subsection (1)(a), after
“Schedule 1,” insert “paragraph 7 of Schedule 1A,”.

8 In section 73 (failure to make returns etc), in subsection (3)(b), after
“Schedule 1,” insert “paragraph 9 or 11 of Schedule 1A,”.

9 In section 74 (interest on VAT recovered or recoverable by assessment), in
35subsection (1)(c), after “Schedule 1,” insert “under paragraph 13 of Schedule
1A,”.

10 In section 77 (assessments: time limits and supplementary assessments), in
subsection (4C), after paragraph (a) insert—

“(aa) paragraph 5, 6 or 13(3) of Schedule 1A,”.

(1) 40Paragraph 1 of Schedule 1 (registration in respect of taxable supplies) is
amended as follows.

(2) In sub-paragraph (1)—