Finance Bill

Session 2013 - 14
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Finance Bill

Finance Bill
Schedule 31 — Annual tax on enveloped dwellings: returns, enquiries, assessments and appeals
Part 7 — Reviews and appeals
414

      (3)
References in this paragraph to an agreement being entered into with an
appellant, and to the giving of notice to or by the appellant, include
references to an agreement being entered into, or notice being given to or by,
a person acting on behalf of the appellant in relation to the appeal.
Assessments and self assessments
5
50    (1)
This paragraph applies where an appeal under paragraph 35(1) has been
notified to the tribunal.
      (2)
If the tribunal decides that the appellant is overcharged by a self assessment
or any other assessment, the assessment must be reduced accordingly.
      (3)
If the tribunal does not so decide, the assessment is to stand good.
10
      (4)
If it appears to the tribunal that the appellant is undercharged to tax by a self
assessment or any other assessment, the assessment must be increased
accordingly.
Tribunal determinations
51
The determination of the tribunal in relation to any proceedings under this
15
Part of this Schedule is to be final and conclusive except as otherwise
provided in—
(a)
sections 9 to 14 of the Tribunals, Courts and Enforcement Act 2007, or
(b)
this Part of this Act.
Payment of tax where appeal has been determined
20
52    (1)
On the determination of an appeal under paragraph 35 any tax overpaid
must be repaid.
      (2)
On the determination of an appeal under paragraph 35, section 161
(payment of tax) has effect in relation to any relevant tax as if—
(a)
the tax were payable in accordance with an assessment under
25
paragraph 22 issued on the date on which HMRC issues to the
appellant a notice of the total amount payable in accordance with the
determination, and
(b)
there had been no appeal against that assessment.
      (3)
The reference in sub-paragraph (2) to “relevant tax” is to any tax payable in
30
accordance with the determination, so far as it is tax—
(a)
the payment of which had been postponed, or
(b)
which would not have been charged by the amendment or
assessment if there had been no appeal.
Payment of tax where there is a further appeal
35
53    (1)
Where a party to an appeal to the tribunal under paragraph 35 makes a
further appeal, tax is to be payable or repayable in accordance with the
determination of the tribunal or court (as the case may be), even though the
further appeal is pending.
      (2)
But if the amount charged by the assessment is altered by the order or
40
judgment of the Upper Tribunal or court, then—

Finance Bill
Schedule 31 — Annual tax on enveloped dwellings: returns, enquiries, assessments and appeals
Part 8 — Supplementary
415

(a)
if too much tax has been paid, the amount overpaid must be
refunded, with any interest allowed by the order or judgment, and
(b)
if too little tax has been charged, the amount undercharged is due
and payable at the end of the 30 days beginning with the date on
which HMRC issue to the other party a notice of the total amount
5
payable in accordance with the order or judgment.
References to “the tribunal”
54    (1)
In this Part of this Schedule “the tribunal” means—
(a)
the First-tier Tribunal, or
(b)
where determined by or under Tribunal Procedure Rules, the Upper
10
Tribunal.
      (2)
Sub-paragraph (1) does not apply so far as sub-paragraph (3) requires
otherwise.
      (3)
Where the question in any dispute on any appeal under paragraph 35(1) is
of the market value of any single-dwelling interest, that question is to be
15
determined on a reference by—
(a)
the Upper Tribunal, if the land is in England and Wales;
(b)
the Lands Tribunal for Scotland, if the land is in Scotland;
(c)
the Lands Tribunal for Northern Ireland, if the land is in Northern
Ireland.
20
Part 8
Supplementary
Application of Schedule in cases involving joint liability to tax
55    (1)
This paragraph applies where—
(a)
section 94(2) applies and the other persons mentioned in section
25
94(1)(b) include a company, or
(b)
section 94(4) applies and P is a company.
      (2)
Any obligation to deliver a return with respect to the single-dwelling
interest for the chargeable period concerned is a joint obligation of the
persons who are jointly and severally liable under subsection (2) or (as the
30
case may be) (4) of section 94; and a single return is required.
Partnerships
56
In relation to a return delivered by the responsible partners for a
partnership, anything required or authorised under section 157 or this
Schedule to be done by the responsible partners is required or authorised to
35
be done by all the responsible partners.
57
In this Schedule “return”, except where the contrary is indicated, means an
annual tax on enveloped dwellings return or a return of the adjusted
chargeable amount.

Finance Bill
Schedule 32 — Annual tax on enveloped dwellings: information and enforcement
Part 1 — Information and inspection powers
416

Meaning of “filing date”
58
“Filing date”, in relation to an annual tax on enveloped dwellings return,
means the day by the end of which the return is required to be delivered.
Schedule 32
Section 162

Annual tax on enveloped dwellings: information and enforcement
5
Part 1
Information and inspection powers
1
Schedule 36 to FA 2008 (information and inspection powers) is amended as
follows.
2
In paragraph 12A (powers to inspect property for valuation etc), in sub-
10
paragraph (3)—
(a)
omit the “or” after paragraph (d), and
(b)
after paragraph (e) insert “, or
(f)
annual tax on enveloped dwellings.”
3
After paragraph 21A insert—
15
“Taxpayer notices following annual tax on enveloped dwellings return
21B   (1)
Where a person has delivered, for a chargeable period with
respect to a single-dwelling interest—
(a)
an annual tax on enveloped dwellings return, or
(b)
a return of the adjusted chargeable amount,
20

a taxpayer notice may not be given for the purpose of checking the
person’s annual tax on enveloped dwellings position as regards
the matters dealt with in that return.
      (2)
Sub-paragraph (1) does not apply where, or to the extent that, any
of conditions A to C is met.
25
      (3)
Condition A is that notice of enquiry has been given in respect
of—
(a)
the return, or
(b)
a claim (or an amendment of a claim) made by the person
in relation to the chargeable period,
30

and the enquiry has not been completed.
      (4)
In sub-paragraph (3) “notice of enquiry” means a notice under
paragraph 8 of Schedule 31 to FA 2013 or paragraph 7 of Schedule
11A to FA 2003 (as applied by paragraph 28(2) of Schedule 31 to
FA 2013).
35
      (5)
Condition B is that, as regards the person, an officer of Revenue
and Customs has reason to suspect that—

Finance Bill
Schedule 32 — Annual tax on enveloped dwellings: information and enforcement
Part 2 — Penalties
417

(a)
an amount that ought to have been assessed to annual tax
on enveloped dwellings for the chargeable period may not
have been assessed,
(b)
an assessment to annual tax on enveloped dwellings for
the chargeable period may be or have become insufficient,
5
or
(c)
relief from annual tax on enveloped dwellings for the
chargeable period may be or have become excessive.
      (6)
Condition C is that the notice is given for the purpose of obtaining
any information or document that is also required for the purpose
10
of checking that person’s position as regards a tax other than
annual tax on enveloped dwellings.
      (7)
In this Schedule references to a “single-dwelling interest” are to be
read in accordance with section 105 of FA 2013.”
4
In paragraph 37 (partnerships), after sub-paragraph (2A) insert—
15
   “(2B)
Where, in respect of a single-dwelling interest (see paragraph
21B(7)) to which one or more companies are or were entitled as
members of a partnership, any member of the partnership has—
(a)
delivered an annual tax on enveloped dwellings return
under Part 3 of FA 2013, or
20
(b)
made a claim under that Part of that Act,

paragraph 21B (restrictions where taxpayer has delivered annual
return) has effect as if that return had been delivered, or that claim
had been made, by each member of the partnership.”
5
In paragraph 63(1) (meaning of “tax” in the Schedule), after paragraph (h)
25
insert—
   “(ha)
annual tax on enveloped dwellings,”.
Part 2
Penalties
Errors in returns
30
6
In Schedule 24 to FA 2007 (penalties for errors), in the Table in paragraph 1,
after the entry relating to stamp duty reserve tax insert—

“Annual tax on enveloped
Annual tax on enveloped

dwellings
dwellings return.

Annual tax on enveloped
Return of adjusted chargeable

35

dwellings
amount.”

Failure to make returns
7     (1)
In Schedule 55 to FA 2009 (penalty for failure to make returns etc), in the

Finance Bill
Schedule 32 — Annual tax on enveloped dwellings: information and enforcement
Part 2 — Penalties
418

Table in paragraph 1, after item 11 insert—

“11A
Annual tax on enveloped
Annual tax on enveloped

dwellings
dwellings return under

section 157 of FA 2013

11B
Annual tax on enveloped
Return of adjusted chargeable

5

dwellings
amount under section 158”.

      (2)
That Schedule, as amended by sub-paragraph (1), is taken to have come into
force for the purposes of annual tax on enveloped dwellings on the date on
which this Act is passed.
Failure to make payments on time
10
8
Paragraphs 9 to 12 contain amendments and modifications of Schedule 56 to
FA 2009 (penalty for failure to make payments on time).
9     (1)
the Table in paragraph 1 of that Schedule is amended as follows.
      (2)
After item 10 insert—

“10A
Annual tax on
Amount payable
The date falling 30 days

15

enveloped
under section
after the date specified

dwellings
161(1) or (2) of FA
in section 161(1) or (2) of

2013 (except an
FA 2013 as the date by

amount falling
which the amount must

within item 23).
be paid”.

20
      (3)
After item 15 insert—

“15A
Annual tax on
Amount shown in
The date falling 30 days

enveloped
determination
after the filing date for

dwellings
under paragraph 18
the return in question”.

of Schedule 31 to

25

FA 2013

      (4)
In item 17, in the second column, for “or 10” substitute “, 10 or 10A” and in
the third column for “15” substitute “15A”.
10    (1)
Until paragraphs 2(13)(a) and 2(14)(a) of Schedule 11 to F(No. 3)A 2010
(which amend items 23 and 24) come into force, paragraph 1 of Schedule 56
30
to FA 2009 has effect as if—
(a)
in item 23 the references in the second and third columns to items 1
to 6, 9 or 10 included item 10A, and
(b)
in item 24 the reference in the second column to items 1 to 6, 9 or 10
included item 10A.
35
      (2)
With effect from the coming into force of paragraphs 2(13)(a) and 2(14)(a) of
Schedule 11 to F(No. 3)A 2010, paragraph 1 of Schedule 56 to FA 2009 is
amended as follows—

Finance Bill
Schedule 33 — Annual tax on enveloped dwellings: miscellaneous amendments and transitory provision
Part 2 — Transitory provision: the first chargeable period
419

(a)
in item 23, in the second and third columns, for “9, 10” substitute “9
to 10A”;
(b)
in item 24, in the second column, for “9, 10” substitute “9 to 10A”.
11
Until paragraph 3 of Schedule 11 to F(No. 3)A 2010 comes into force,
paragraph 2(c) has effect as if the reference in that paragraph to items 1 to 10
5
were to items 1 to 10A.
12
Schedule 56 to FA 2009, as amended by paragraph 4, is taken to have come
into force for the purposes of annual tax on enveloped dwellings on the date
on which this Act is passed.
Schedule 33
10
Section 166

Annual tax on enveloped dwellings: miscellaneous amendments and
transitory provision
Part 1
Miscellaneous amendments
Provisional collection of taxes
15
1
In section 1(1) of the Provisional Collection of Taxes Act 1968 (temporary
statutory effect of House of Commons resolutions), after “stamp duty land
tax,” insert “annual tax on enveloped dwellings,”.
Disclosure of tax avoidance schemes
2
In section 318(1) of FA 2004 (disclosure of tax avoidance schemes:
20
interpretation), in the definition of “tax”—
(a)
omit the “or” after paragraph (f), and
(b)
after paragraph (g) insert “, or
(h)
annual tax on enveloped dwellings.”
Definitions relating to charities
25
3
In paragraph 7 of Schedule 6 to FA 2010 (definition of “charity”, “charitable
company” and “charitable trust”)—
(a)
omit the “and” after paragraph (g), and
(b)
after paragraph (h) insert “, and
(i)
annual tax on enveloped dwellings.”
30
Part 2
Transitory provision: the first chargeable period
4
In relation to the chargeable period beginning on 1 April 2013, section 157
has effect as if subsections (2) and (3) of that section provided as follows—
“(2)
A return under subsection (1) must be delivered by the end of 1
35
October 2013 if the days on which the person is within the charge
with respect to the interest include 1 April 2013.

Finance Bill
Schedule 34 — Treatment of liabilities for inheritance tax purposes
420

(3)
If the days on which the person is within the charge with respect to
the interest do not include 1 April 2013, the return must be
delivered—
(a)
by the end of 1 October 2013, or
(b)
by the end of the period of 30 days beginning with the first
5
day in the chargeable period on which the person is within
the charge with respect to the interest,

whichever is the later.”
5
In relation to the chargeable period beginning on 1 April 2013, section 161
(payment of tax) has effect as if subsection (1) of that section provided as
10
follows—
“(1)
Tax charged on a person under section 96 with respect to a single-
dwelling interest must be paid—
(a)
by the end of 31 October 2013, or
(b)
if later, by the end of the filing date for the return.”
15
Schedule 34
Section 174

Treatment of liabilities for inheritance tax purposes
IHTA 1984
1
IHTA 1984 is amended as follows.
2     (1)
Section 162 (liabilities) is amended as follows.
20
      (2)
In subsection (4), after “possible” insert “and to the extent that it is not taken
to reduce value in accordance with section 162B”.
      (3)
In subsection (5), after “possible” insert “and to the extent that it is not taken
to reduce value in accordance with section 162B”.
3
After section 162 insert—
25
“162A
Liabilities attributable to financing excluded property
(1)
To the extent that a liability is attributable to financing (directly or
indirectly)—
(a)
the acquisition of any excluded property, or
(b)
the maintenance, or an enhancement, of the value of any such
30
property,

it may only be taken into account so far as permitted by subsection
(2) or (3).
(2)
Where the excluded property has been disposed of, in whole or in
part, for full consideration in money or money’s worth, the liability
35
may be taken into account up to an amount equal to so much of that
consideration as—
(a)
is not excluded property, and
(b)
has not been used—