National Insurance Contributions BillPage 10
(1) SSCBA 1992 is amended as follows.
(2) After section 18 insert—
(1) The Treasury may by regulations—
(a)
modify the way in which an AIFM partner’s liabilities for Class
4 contributions are determined, or
(b)
in relation to Class 4 contributions, otherwise modify any
10provision made by or under this Act as it applies in the case of
an AIFM partner.
(2)
“AIFM partner” means a person who is or was a partner in a firm for
the purposes of the Income Tax (Trading and Other Income) Act 2005
(including where that is the case by virtue of section 863 of that Act)
15where the firm is or was an AIFM firm.
(3)
“AIFM firm” means a firm which is managing, or has managed, an AIF
as determined in accordance with regulation 4(2) of the Alternative
Investment Fund Managers Regulations 2013 (S.I. 2013/1773S.I. 2013/1773).
(4)
Regulations under this section may have retrospective effect; but they
20may not have effect before the beginning of the tax year in which they
are made.”
(3)
In section 176(1)(a) (parliamentary control: instruments subject to affirmative
procedure), after “section 18;” insert—
“section 18A;”.
(4) 25SSCB(NI)A 1992 is amended as follows.
(5) After section 18 insert—
(1) The Treasury may by regulations—
(a)
modify the way in which an AIFM partner’s liabilities for Class
304 contributions are determined, or
(b) in relation to Class 4 contributions, otherwise modify—
(i) any provision made by or under this Act, or
(ii)
any provision made by or under the Great Britain
Contributions and Benefits Act which extends to
35Northern Ireland,
as the provision applies in the case of an AIFM partner.
(2)
“AIFM partner” means a person who is or was a partner in a firm for
the purposes of the Income Tax (Trading and Other Income) Act 2005
(including where that is the case by virtue of section 863 of that Act)
40where the firm is or was an AIFM firm.
(3)
“AIFM firm” means a firm which is managing, or has managed, an AIF
as determined in accordance with regulation 4(2) of the Alternative
Investment Fund Managers Regulations 2013 (S.I. 2013/1773S.I. 2013/1773).
National Insurance Contributions BillPage 11
(4)
Regulations under this section may have retrospective effect; but they
may not have effect before the beginning of the tax year in which they
are made.”
(6)
In section 172(11A) (parliamentary control: instruments subject to affirmative
5procedure), after “18,” insert “18A,”.
(7)
The amendments made by this section come into force at the end of the period
of 2 months beginning with the day on which this Act is passed.
(1) In section 2 of SSCBA 1992 (categories of earners), after subsection (5) insert—
“(6)
10Section 4(4) of the Limited Liability Partnerships Act 2000 does not
apply for the purposes of this Act.”
(2)
In section 2 of SSCB(NI)A 1992 (categories of earners), after subsection (5)
insert—
“(6)
Section 4(4) of the Limited Liability Partnerships Act 2000 does not
15apply for the purposes of this Act.”
(3) The amendments made by this section come into force on 6 April 2014.
(1)
In section 2(1)(a) of SSCBA 1992 (definition of “employed earner”), omit
20“general”.
(2)
In section 2(1)(a) of SSCB(NI)A 1992 (definition of “employed earner”), omit
“general”.
(3)
Schedule 2 makes provision that is consequential upon office holders in receipt
of “earnings” (as opposed to “general earnings”) being employed earners.
(4)
25The amendments made by this section and Schedule 2 come into force at the
end of the period of 2 months beginning with the day on which this Act is
passed.
Paragraph 10A of Part 6 of Schedule 3 to the Social Security (Contributions)
30Regulations 2001 (S.I. 2001/1004S.I. 2001/1004) (payments under the Armed Forces Early
Departure Payments Scheme Order 2005 (S.I. 2005/437S.I. 2005/437) to be disregarded) also
has effect for the tax years 2005-06 to 2012-13 inclusive.
(1) In Schedule 2 to SSCBA 1992 (levy of Class 4 contributions with income tax)—
(a) 35omit paragraph 3(3), and
(b) omit paragraph 9 (and the heading immediately before it).
(2)
In Schedule 2 to SSCB(NI)A 1992 (levy of Class 4 contributions with income
tax)—
National Insurance Contributions BillPage 12
(a) omit paragraph 3(3), and
(b) omit paragraph 9 (and the heading immediately before it).
(3)
The amendments made by subsections (1)(a) and (2)(a) have effect for the tax
year after the one during which this Act is passed and for subsequent tax years.
(1)
Section 172 of SSCB(NI)A 1992 (Assembly etc control of regulations and
orders) is amended as follows.
(2) In subsection (11), for “(9)” substitute “(10)”.
(3) In subsection (11B)—
(a) 10after “contains” insert “—
(a)”,
(b) after “129” insert “or 142(7)”, and
(c) after “Act” insert “,
(b)
regulations under powers conferred by any provision
15mentioned in that subsection which are to be made for
the purpose of consolidating regulations to be revoked
in the instrument, or
(c)
regulations which, in so far as they are made under
powers conferred by any provision mentioned in that
20subsection, only replace provisions of previous
regulations with new provisions to the same effect.”
(4)
Section 165 of the Social Security Administration (Northern Ireland) Act 1992
(regulations and orders — general) is amended as follows.
(5) In subsection (1), after “to be made by” insert “the Secretary of State,”.
(6) 25In subsection (3), after “the Department” insert “, the Secretary of State”.
(7)
The amendments made by this section come into force at the end of the period
of 2 months beginning with the day on which this Act is passed.
(1)
30In section 165 of the Social Security Administration Act 1992 (adjustments between
the National Insurance Fund and Consolidated Fund), in subsection (5)(a), after
“adoption pay” insert “or the National Insurance Contributions Act 2013”.
(2)
In section 145 of the Social Security Administration (Northern Ireland) Act 1992
(adjustments between the National Insurance Fund and Consolidated Fund), in
35subsection (5)(a), after “adoption pay” insert “or the National Insurance
Contributions Act 2013”.
In this Act—
“SSCBA 1992” means the Social Security Contributions and Benefits Act
401992;
National Insurance Contributions BillPage 13
“SSCB(NI)A 1992” means the Social Security Contributions and Benefits
(Northern Ireland) Act 1992.
(1) This Act may be cited as the National Insurance Contributions Act 2013.
(2)
5Subject to subsection (3), this Act extends to England and Wales, Scotland and
Northern Ireland.
(3)
An amendment or repeal made by this Act has the same extent as the provision
amended or repealed.
National Insurance Contributions BillPage 14
Section 3
1 This Part applies for the purposes of section 3(1).
2 (1) Two companies are “connected” with one another if—
(a) 10one of the two has control of the other, or
(b) both are under the control of the same person or persons.
(2)
In sub-paragraph (1) “control” has the same meaning as in Part 10 of CTA
2010 (see sections 450 and 451 of that Act) (and a limited liability partnership
is to be treated as a company for the purposes of that Part as applied by this
15sub-paragraph).
(3)
For this purpose, where under section 450 of that Act “C” is a limited liability
partnership, subsection (3) of that section has effect as if before paragraph (a)
there were inserted—
“(za)
rights to a share of more than half the assets, or of more than
20half the income, of C,”.
(4) Sub-paragraphs (1) to (3) are subject to paragraphs 3 to 6.
(5) Paragraph 7 provides for further connections.
(6) In this Part “CTA 2010” means the Corporation Tax Act 2010.
3
(1)
25This paragraph applies for the purpose of determining under paragraph 2(1)
if two companies are connected with one another if the relationship between
the companies is not one of substantial commercial interdependence.
(2)
In the application of section 451 of CTA 2010 for the purposes of the
determination, any person to whom rights and duties fall to be attributed
30under subsections (4) and (5) of that section is to be treated, for the purposes
of those subsections, as having no associates.
National Insurance Contributions BillPage 15
(3)
In determining for the purposes of sub-paragraph (1) if two companies have
a relationship of “substantial commercial interdependence”, the following
factors are to be taken into account—
(a)
the degree to which the companies are financially interdependent
5(see sub-paragraph (4)),
(b)
the degree to which the companies are economically interdependent
(see sub-paragraph (5)), and
(c)
the degree to which the companies are organisationally
interdependent (see sub-paragraph (6)).
(4) 10Two companies are “financially interdependent” if (in particular)—
(a) one gives financial support (directly or indirectly) to the other, or
(b)
each has (directly or indirectly) a financial interest in the other’s
activities.
(5) Two companies are “economically interdependent” if (in particular)—
(a) 15they seek to realise the same economic objective,
(b) the activities of one benefit the other, or
(c) their activities involve common customers.
(6)
Two companies are “organisationally interdependent” if (in particular) they
have—
(a) 20common management,
(b) common employees,
(c) common premises, or
(d) common equipment.
4
(1)
25In determining for the purposes of paragraph 2(1) if a company is under the
control of another, fixed-rate preference shares held by a company are
ignored if the company holding them—
(a) is not a close company,
(b)
takes no part in the management or conduct of the company which
30issued the shares, or in the management or conduct of its business,
and
(c)
subscribed for the shares in the ordinary course of a business which
includes the provision of finance.
(2) In sub-paragraph (1) “fixed-rate preference shares” means shares which—
(a) 35were issued wholly for new consideration,
(b)
do not carry any right either to conversion into shares or securities of
any other description or to the acquisition of any additional shares or
securities, and
(c) do not carry any right to dividends other than dividends which—
(i)
40are of a fixed amount or at a fixed rate per cent of the nominal
value of the shares, and
(ii)
together with any sum paid on redemption, represent no
more than a reasonable commercial return on the
consideration for which the shares were issued.
(3)
45In sub-paragraph (2)(a) “new consideration” has the meaning given by
section 1115 of CTA 2010.
National Insurance Contributions BillPage 16
(4)
In sub-paragraph (1)(a) “close company” is to be read in accordance with
Chapter 2 of Part 10 of CTA 2010 (see, in particular, section 439 of that Act).
5
(1)
A company (“A”) is not under the control of another company (“B”) for the
5purposes of paragraph 2(1) if—
(a) B is a loan creditor of A,
(b) there is no other connection between A and B, and
(c) either—
(i) B is not a close company, or
(ii)
10B’s relationship to A as a loan creditor arose in the ordinary
course of a business which B carries on.
(2) Sub-paragraph (3) applies if—
(a)
two companies (“A” and “B”) are under the control of the same
person who is a loan creditor of each of them,
(b) 15there is no other connection between A and B, and
(c) either—
(i)
the loan creditor is a company which is not a close company,
or
(ii)
the loan creditor’s relationship to each of A and B as a loan
20creditor arose in the ordinary course of a business which the
loan creditor carries on.
(3)
In determining under paragraph 2(1) if A and B are connected with one
another, rights which the loan creditor has as a loan creditor of A, or as a loan
creditor of B, are ignored.
(4) 25In sub-paragraph (2)(a) “control” has the same meaning as in paragraph 2(1).
(5) In this paragraph—
(a)
“close company” is to be read in accordance with Chapter 2 of Part
10 of CTA 2010 (see, in particular, section 439 of that Act),
(b)
“connection” includes a connection in the past as well as a connection
30in the present and references to a connection between two companies
include any dealings between them, and
(c)
references to a loan creditor of a company are to be read in
accordance with section 453 of CTA 2010.
6 (1) 35Sub-paragraph (2) applies if—
(a)
two companies (“A” and “B”) are under the control of the same
person by virtue of rights or powers (or both) held in trust by that
person, and
(b) there is no other connection between A and B.
(2)
40In determining under paragraph 2(1) if A and B are connected with one
another, the rights and powers mentioned in sub-paragraph (1)(a) are
ignored.
(3) In sub-paragraph (1)—
(a) “control” has the same meaning as in paragraph 2(1), and
National Insurance Contributions BillPage 17
(b)
“connection” includes a connection in the past as well as a connection
in the present and the reference to a connection between A and B
includes any dealings between them.
7 (1) 5This paragraph applies if—
(a) a company (“A”) is connected with another company (“B”), and
(b) B is connected with another company (“C”).
(2)
A and C are also connected with one another (if that would not otherwise be
the case).
(3)
10In sub-paragraph (1)(a) the reference to a company being connected with
another company is to that company being so connected by virtue of
paragraphs 2 to 6 or this paragraph, and in sub-paragraph (1)(b) the
reference to a company being connected with another company is to that
company being so connected by virtue of paragraphs 2 to 6.
8
(1)
Two charities are connected with one another for the purposes of section 3(2)
if—
(a)
they are connected with one another in accordance with section 993
20of the Income Tax Act 2007 (meaning of “connected” persons), and
(b) their purposes and activities are the same or substantially similar.
(2)
In the application of section 993 of the Income Tax Act 2007 for the purposes
of sub-paragraph (1)(a)—
(a)
a charity which is a trust is to be treated as if it were a company (and
25accordingly a person), including in this sub-paragraph;
(b)
a charity which is a trust has “control” of another person if the
trustees (in their capacity as trustees of the charity) have, or any of
them has, control of the person;
(c)
a person (other than a charity regulator) has “control” of a charity
30which is a trust if—
(i)
the person is a trustee of the charity and some or all of the
powers of the trustees of the charity could be exercised by the
person acting alone or by the person acting together with any
other persons who are trustees of the charity and who are
35connected with the person,
(ii)
the person, alone or together with other persons, has power
to appoint or remove a trustee of the charity, or
(iii)
the person, alone or together with other persons, has any
power of approval or direction in relation to the carrying out
40by the trustees of any of their functions.
(3)
A charity which is a trust is also connected with another charity which is a
trust for the purposes of section 3(2) if at least half of the trustees of one of
the charities are—
(a) trustees of the other charity,
National Insurance Contributions BillPage 18
(b)
persons who are connected with persons who are trustees of the
other charity, or
(c) a combination of both,
and the charities’ purposes and activities are the same or substantially
5similar.
(4)
In determining if a person is connected with another person for the purposes
of sub-paragraph (2)(c)(i) or (3)(b), apply section 993 of the Income Tax Act
2007 with the omission of subsection (3) of that section (and without the
modifications in sub-paragraph (2)).
(5)
10If a charity (“A”) controls a company (“B”) which, apart from this sub-
paragraph, would not be a charity—
(a)
B is to be treated as if it were a charity for the purposes of section 3
and this Part (including this sub-paragraph), and
(b)
A and B are connected with one another for the purposes of section
153(2).
(6) In sub-paragraph (5) “control” is to be read in accordance with—
(a) paragraph 2(2) and (3) (but ignoring paragraphs 3 to 6), and
(b) sub-paragraph (2)(b) of this paragraph.
9 (1) This paragraph applies if—
(a)
20a charity (“A”) is connected with another charity (“B”) for the
purposes of section 3(2), and
(b)
B is connected with another charity (“C”) for the purposes of section
3(2).
(2)
A and C are also connected with one another for the purposes of section 3(2)
25(if that would not otherwise be the case).
(3)
In sub-paragraph (1)(a) the reference to a charity being connected with
another charity for the purposes of section 3(2) is to that charity being so
connected by virtue of paragraph 8 or this paragraph, and in sub-paragraph
(1)(b) the reference to a charity being connected with another charity for the
30purposes of section 3(2) is to that charity being so connected by virtue of
paragraph 8.
Section 14
1 SSCBA 1992 is amended as follows.
2
In section 7(1)(b) (definition of “secondary contributor” in relation to office
holders), omit “general” in both places it appears.
3
In section 163(1) (interpretation of Part 11 of that Act: statutory sick pay), in
40paragraph (a) of the definition of “employee”, for “general earnings (as
defined by section 7 of the Income Tax (Earnings and Pensions) Act 2003)”
substitute “earnings (within the meaning of Parts 1 to 5 above)”.
National Insurance Contributions BillPage 19
4
In section 171(1) (interpretation of Part 12 of that Act: statutory maternity
pay), in paragraph (a) of the definition of “employee”, for “general earnings
(as defined by section 7 of the Income Tax (Earnings and Pensions) Act
2003)” substitute “earnings (within the meaning of Parts 1 to 5 above)”.
5
5In section 171ZJ(2)(a) (definition of “employee” for Part 12ZA of that Act:
ordinary and additional statutory paternity pay), for “general earnings (as
defined by section 7 of the Income Tax (Earnings and Pensions) Act 2003)”
substitute “earnings (within the meaning of Parts 1 to 5 above)”.
6
In section 171ZS(2)(a) (definition of “employee” for Part 12ZB of that Act:
10statutory adoption pay), for “general earnings (as defined by section 7 of the
Income Tax (Earnings and Pensions) Act 2003)” substitute “earnings (within
the meaning of Parts 1 to 5 above)”.
7 SSCB(NI)A 1992 is amended as follows.
8
15In section 7(1)(b) (definition of “secondary contributor” in relation to office
holders), omit “general” in both places it appears.
9
In section 159(1) (interpretation of Part 11 of that Act: statutory sick pay), in
paragraph (a) of the definition of “employee”, for “general earnings (as
defined by section 7 of the Income Tax (Earnings and Pensions) Act 2003)”
20substitute “earnings (within the meaning of Parts 1 to 5 above)”.
10
In section 167(1) (interpretation of Part 12 of that Act: statutory maternity
pay), in paragraph (a) of the definition of “employee”, for “general earnings
(as defined by section 7 of the Income Tax (Earnings and Pensions) Act
2003)” substitute “earnings (within the meaning of Parts 1 to 5 above)”.
11
25In section 167ZJ(2)(a) (definition of “employee” for Part 12ZA of that Act:
ordinary and additional statutory paternity pay), for “emoluments
chargeable to income tax under Schedule E” substitute “earnings (within the
meaning of Parts 1 to 5 above)”.
12
In section 167ZS(2)(a) (definition of “employee” for Part 12ZB of that Act:
30statutory adoption pay), for “emoluments chargeable to income tax under
Schedule E” substitute “earnings (within the meaning of Parts 1 to 5 above)”.
13
In section 181(1) of the Pension Schemes Act 1993 (general interpretation), in
the definition of “employee”, for “general earnings (as defined by section 7
35of the Income Tax (Earnings and Pensions) Act 2003)” substitute “earnings”.
14
In section 176(1) of the Pension Schemes (Northern Ireland) Act 1993
(general interpretation), in the definition of “employee”, for “general
earnings (as defined by section 7 of the Income Tax (Earnings and Pensions)
40Act 2003)” substitute “earnings”.