House of Commons Amendments

Session 2013 - 14
Internet Publications
Other Bills before Parliament

391

House of Commons

Notices of Amendments

given on

Wednesday 26 June 2013

For other Amendment(s) see the following page(s) of Supplement to Votes:

387-88 and 389

Consideration of Bill

Finance Bill, As Amended

Transfer of deductions

Mr Chancellor of the Exchequer

NC4

To move the following Clause:—

‘Schedule [Transfer of deductions]—

(a)
inserts into CTA 2010 a new Part 14A (transfer of deductions), and

(b)
makes consequential provision.’.

Restrictions on buying capital allowances

Mr Chancellor of the Exchequer

NC5

To move the following Clause:—

‘
Schedule [Restrictions on buying capital allowances] contains provision

amending Chapter 16A of Part 2 of CAA 2001 (restrictions on allowance

buying).’

High quality liquid assets

Mr Chancellor of the Exchequer

NC6

To move the following Clause:—

‘(1)
In paragraph 70 of Schedule 19 to FA 2011 (bank levy: definitions), in sub-

paragraph (1), in the definition of “high quality liquid asset” for “section

12.7.2(1) to (4)” substitute “section 12.7 (assets that are eligible for inclusion in

a firm’s regulatory liquid assets buffer)’.

Notices of Amendments: 26 June 2013
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Finance Bill, continued

(2)
The amendment made by this section has effect in relation to chargeable periods

ending on or after 1 January 2011, and in relation to those chargeable periods the

amendment is to be treated as always having had effect.’.

Restrictions on interim payments in proceedings relating to taxation matters

Mr Chancellor of the Exchequer

NC7

To move the following Clause:—

‘(1)
This section applies to an application for an interim remedy (however described),

made in any court proceedings relating to a taxation matter, if the application is

founded (wholly or in part) on a point of law which has yet to be finally

determined in the proceedings.

(2)
Any power of a court to grant an interim remedy (however described) requiring

the Commissioners for Her Majesty’s Revenue and Customs, or an officer of

Revenue and Customs, to pay any sum to any claimant (however described) in the

proceedings is restricted as follows.

(3)
The court may grant the interim remedy only if it is shown to the satisfaction of

the court—

(a)
that, taking account of all sources of funding (including borrowing)

reasonably likely to be available to fund the proceedings, the payment of

the sum is necessary to enable the proceedings to continue, or

(b)
that the circumstances of the claimant are exceptional and such that the

granting of the remedy is necessary in the interests of justice.

(4)
The powers restricted by this section include (for example)—

(a)
powers under rule 25 of the Civil Procedure Rules 1998 (S.I. 1998/3132);

(b)
powers under Part II of Rule 29 of the Rules of the Court of Judicature

(Northern Ireland) (Revision) 1980 (S.R. 1980 No.346).

(5)
This section applies in relation to proceedings whenever commenced, but only in

relation to applications made in those proceedings on or after 26 June 2013.

(6)
This section applies on and after 26 June 2013.

(7)
Subsection (8) applies where, on or after 26 June 2013 but before the passing of

this Act, an interim remedy was granted by a court using a power which, because

of subsection (6), is to be taken to have been restricted by this section.

(8)
Unless it is shown to the satisfaction of the court that paragraph (a) or (b) of

subsection (3) applied at the time the interim remedy was granted, the court must,

on an application made to it under this subsection—

(a)
revoke or modify the interim remedy so as to secure compliance with this

section, and

(b)
if the Commissioners have, or an officer of Revenue and Customs has,

paid any sum as originally required by the interim remedy, order the

repayment of the sum or any part of the sum as appropriate (with interest

from the date of payment).

(9)
For the purposes of this section, proceedings on appeal are to be treated as part of

the original proceedings from which the appeal lies.

(10)
In this section “taxation matter” means anything, other than national insurance

contributions, the collection and management of which is the responsibility of the

Commissioners for Her Majesty’s Revenue and Customs (or was the

responsibility of the Commissioners of Inland Revenue or Commissioners of

Customs and Excise).’.

Notices of Amendments: 26 June 2013
393

Finance Bill, continued

Mr Chancellor of the Exchequer

ns1

To move the following Schedule:—

‘Transfer of deductions

New Part 14A of CTA 2010

1
After Part 14 of CTA 2010 insert—

“Part 14A

Transfer of deductions

730A
Overview

(1)
This Part makes provision restricting the circumstances in which

deductible amounts may be brought into account where there has been

a qualifying change in relation to a company.

(2)
For the meaning of “deductible amount” and “qualifying change” see

section 730B.

730B
Interpretation of Part

(1)
In this Part—

“arrangements” includes any agreement, understanding, scheme,

transaction or series of transactions (whether or not legally

enforceable),

“C” means the company mentioned in section 730A(1),

“deductible amount” means—

(a)
an expense of a trade,

(b)
an expense of a UK property business or an overseas property

business,

(c)
an expense of management of a company’s investment business

within the meaning of section 1219 of CTA 2009,

(d)
a non-trading debit within the meaning of Parts 5 and 6 of CTA

2009 (loan relationships and derivative contracts) (see section

301(2) of that Act), or

(e)
a non-trading debit within the meaning of Part 8 of CTA 2009

(intangible fixed assets) (see section 746 of that Act),

but does not include any amount that has been taken into account in

determining RTWDV within the meaning of Chapter 16A of Part 2 of

CAA 2001 (restrictions on allowance buying) (see section 212K of

that Act),

“qualifying change”, in relation to a company, has the same meaning as

in that Chapter, and

“the relevant day” means the day on which the qualifying change in

relation to C occurred.

(2)
In this Part, references to bringing an amount into account “as a

deduction” in any period are to bringing it into account as a deduction

in that period—

(a)
in calculating profits, losses or other amounts for corporation

tax purposes, or

(b)
from profits or other amounts chargeable to corporation tax.

Notices of Amendments: 26 June 2013
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Finance Bill, continued

730C
Disallowance of deductible amounts: relevant claims

(1)
This section applies where a relevant claim is made for an accounting

period ending on or after the relevant day.

(2)
“Relevant claim” means a claim by C, or a company connected with

C, under—

(a)
section 37 (relief for trade losses against total profits), or

(b)
Chapter 4 of Part 5 (group relief).

(3)
A deductible amount that meets conditions A and B may not be the

subject of, or brought into account as a deduction in, the claim.

(4)
But subsection (3) does not exclude any amount which could have

been the subject of, or brought into account as a deduction in, the claim

in the absence of the qualifying change.

(5)
Condition A is that, on the relevant day, it is highly likely that the

amount, or any part of it, would (disregarding this Part) be the subject

of, or brought into account as a deduction in, a relevant claim for an

accounting period ending on or after the relevant day.

(6)
Any question as to what is “highly likely” on the relevant day for the

purposes of subsection (5) is to be determined having regard to—

(a)
any arrangements made on or before that day, and

(b)
any events that take place on or before that day.

(7)
Condition B is that the main purpose, or one of the main purposes, of

change arrangements is for the amount (whether or not together with

other deductible amounts) to be the subject of, or brought into account

as a deduction in, a relevant claim for an accounting period ending on

or after the relevant day.

(8)
“Change arrangements” means any arrangements made to bring about,

or otherwise connected with, the qualifying change.

(9)
This section does not apply to a deductible amount if, and to the extent

that—

(a)
section 730D(2) applies to it, or

(b)
for the purposes of section 432, a loss, or any part of a loss, to

which section 433(2) applies derives from it.

730D
Disallowance of deductible amounts: profit transfers

(1)
This section applies where arrangements (“the profit transfer

arrangements”) are made which result in—

(a)
an increase in the total profits of C, or of a company connected

with C, or

(b)
a reduction of any loss or other amount for which relief from

corporation tax could (disregarding this section) have been

given to C or a company connected with C,


in any accounting period ending on or after the relevant day.

(2)
A deductible amount that meets conditions D and E may not be

brought into account by C, nor any company connected with C, as a

deduction in any accounting period ending on or after the relevant day.

(3)
Condition D is that, on the relevant day, it is highly likely that the

amount, or any part of it, would (disregarding this Part) be brought into

Notices of Amendments: 26 June 2013
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Finance Bill, continued

account by C, or any company connected with C, as a deduction in any

accounting period ending on or after the relevant day.

(4)
Any question as to what is “highly likely” on the relevant day for the

purposes of subsection (3) is to be determined having regard to—

(a)
any arrangements made on or before that day, and

(b)
any events that take place on or before that day.

(5)
Condition E is that the main purpose, or one of the main purposes, of

the profit transfer arrangements is to bring the amount (whether or not

together with other deductible amounts) into account as a deduction in

any accounting period ending on or after the relevant day.

(6)
Subsection (7) applies if—

(a)
(disregarding subsection (7)) subsection (2) would prevent a

deductible amount being brought into account by a company

as a deduction in any accounting period ending on or after the

relevant day, and

(b)
in the absence of the profit transfer arrangements and

disregarding any deductible amounts, the company would

have an amount of total profits for that accounting period.

(7)
Subsection (2) applies only in relation to such proportion of the

deductible amount mentioned in subsection (6)(a) as is just and

reasonable.”

Consequential amendments

2    (1)
In section 1(4) of CTA 2010 (overview of Act), after paragraph (a) insert—

“(aa)
transfer of deductions (see Part 14A),”.

      (2)
In section 432 of that Act (sale of lessors: restriction on relief for certain

expenses), after subsection (1) insert—

“(1A)
For the purposes of subsection (1), an expense is to be disregarded if,

and to the extent that, section 730D(2) (disallowance of deductible

amounts: profit transfers) applies to it.”

      (3)
In Schedule 4 to that Act (index of defined expressions), insert at the

appropriate places—

“arrangements (in Part 14A)
section 730B”

“as a deduction (in Part 14A)
section 730B”

“C (in Part 14A)
section 730B

“deductible amount (in Part 14A)
section 730B”

“qualifying change (in Part 14A)
section 730B”

“the relevant day (in Part 14A)
section 730B”.

Commencement and transitional provision

3    (1)
The amendments made by this Schedule have effect in relation to a qualifying

change if the relevant day is on or after 20 March 2013.

      (2)
But those amendments do not have effect if before that date—

Notices of Amendments: 26 June 2013
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Finance Bill, continued

(a)
the arrangements made to bring about the qualifying change were

entered into, or

(b)
there was an agreement, or common understanding, between the

parties to those arrangements as to the principal terms on which the

qualifying change would be brought about.

      (3)
If—

(a)
the relevant day in relation to a qualifying change is before 26 June

2013, or

(b)
paragraph (a) or (b) of sub-paragraph (2) was satisfied before that date,


those amendments have effect in relation to the qualifying change as if section

730C(9)(b) were omitted.’.

Mr Chancellor of the Exchequer

ns2

To move the following Schedule:—

‘Restrictions on buying capital allowances

Introductory

1
Chapter 16A of Part 2 of CAA 2001 (avoidance involving allowance buying)

is amended as follows.

Restrictions where certain conditions met

2    (1)
Section 212B (circumstances where Chapter 16A applies) is amended as

follows.

      (2)
For subsection (1)(d) substitute—

“(d)
the qualifying change meets one of the limiting conditions.”

      (3)
For subsection (4) substitute—

“(4)
Sections 212LA and 212M set out the limiting conditions and specify

when those conditions are met.”

3
After section 212L insert—

“Limiting conditions

212LA
Limiting conditions

(1)
The qualifying change meets one of the limiting conditions if

condition A, B, C or D is met.

(2)
Condition A is that the amount of the relevant excess of allowances is

£50 million or more.

(3)
Condition B is that the amount of the relevant excess of allowances—

(a)
is £2 million or more but less than £50 million, and

(b)
is not insignificant as a proportion of the total amount or value

of the benefits derived by any relevant person by virtue of the

qualifying change or change arrangements.

(4)
“Relevant person” means a person who, at the end of the relevant day,

is—

(a)
a principal company of C,

(b)
a person carrying on the relevant activity in partnership, or

Notices of Amendments: 26 June 2013
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Finance Bill, continued

(c)
a person who is connected to a person within paragraph (a) or

(b) (within the meaning of section 1122 of CTA 2010).

(5)
Condition C is that—

(a)
the amount of the relevant excess of allowances is less than £2

million, and

(b)
the qualifying change has an unallowable purpose.


See section 212M for the meaning of “unallowable purpose”.

(6)
Condition D is that the main purpose, or one of the main purposes, of

any arrangements is to procure that condition A or B or paragraph (a)

of condition C is not met.

(7)
In this section—

the amount of the relevant excess of allowances is the difference between

RTWDV and BSV (see sections 212K and 212L);

“change arrangements” and “arrangements” have the same meaning as in

section 212M.”

4
In consequence of the amendments made by paragraphs 2 and 3, the heading

to Chapter 16A becomes “Restrictions on allowance buying”.

Extension of restrictions to other qualifying activities

5    (1)
Section 212B (circumstances where Chapter 16A applies) is amended as

follows.

      (2)
In subsection (1)—

(a)
in paragraph (a), for “a trade (“the relevant trade”)” substitute “a

qualifying activity (“the relevant activity”)”, and

(b)
in paragraph (c), for “trade” (in both places) substitute “activity”.

      (3)
In subsection (3) for “trade” substitute “activity”.

6    (1)
Section 212C (when there is a a qualifying change in relation to C) is amended

as follows.

      (2)
In subsection (4)—

(a)
after “Condition C is that” insert “the relevant activity is a trade

(within the meaning of this Part) and”, and

(b)
for “trade”, where it appears after “the relevant” (in both places),

substitute “activity”.

      (3)
In subsection (5) for “trade” (in both places) substitute “activity”.

7    (1)
Section 212I (relevant percentage share) is amended as follows.

      (2)
In subsections (1) and (3) for “trade” substitute “activity”.

      (3)
In subsection (2) for “a trade” substitute “an activity”.

8
In section 212J(1) (relevant excess of allowances) for “trade” substitute

“activity”.

9
In section 212K(2), (3), (4) and (5) (relevant tax written-down value) for

“trade” substitute “activity”.

10
In section 212N(2), (3) and (4) (old and new accounting periods) for “trade”

substitute “activity”.

11  (1)
Section 212P (effect of excess on pools) is amended as follows.

      (2)
In subsection (3)—

(a)
for “a trade (or part of a trade)” substitute “a qualifying activity (or

part of a qualifying activity)”,

(b)
for “the activities of that trade (or part of a trade)” substitute “that

activity (or that part of an activity)”,



© Parliamentary copyright	Revised 27 June 2013