Finance (No. 2) Bill (HC Bill 193)

payable by way of levy) for the table substitute—

(2) 15The amendment made by this section has effect in relation to supplies treated
as taking place on or after 1 April 2016.

63 Combined heat and power stations

(1) Schedule 6 to FA 2000 (climate change levy) is amended as follows.

(2) In paragraph 24B (deemed taxable supply: commodities to be used in
20combined heat and power station)—

(a) in sub-paragraph (2), at the end insert “to which sub-paragraph (2A)
does not apply”,

(b) after that sub-paragraph insert—

“(2A) This sub-paragraph applies to electricity so far as—

(a) 25it is included in the CHP Qualifying Power Output of
the combined heat and power station’s CHPQA
scheme, and

(b) either condition A or B is met.

(2B) Condition A is that the producer of the electricity makes no
30supply of it to another person, but causes it to be consumed
in the United Kingdom.

(2C) Condition B is that the electricity is supplied (within the
meaning of Part 1 of the Electricity Act 1989 (see section 64 of
that Act)) by a person who is an exempt unlicensed electricity
35supplier.”,

(c) in sub-paragraph (3), after “electricity” insert “to which sub-paragraph
(2A) does not apply”, and

(d) for sub-paragraph (7) substitute—

“(7) For the purposes of this paragraph—

Finance (No. 2) BillPage 71

• “CHP Qualifying Power Output” has the meaning given
  by section 4 of the Combined Heat and Power Quality
  Assurance Standard, Issue 5 (November 2013),
  prepared by the Department of Energy and Climate
  5Change or, if that issue of the Standard has been
  replaced by another issue, by the current issue of the
  Standard (taking account, in either case, of any
  amendment which has been made to the issue);

• “CHPQA scheme”, in relation to a combined heat and
  10power station, means the scheme in relation to which
  the station’s CHPQA certificate was issued;

• “CHPQA site”, in relation to a fully exempt combined
  heat and power station or a partly exempt combined
  heat and power station, means the site of the CHPQA
  15scheme.”

(3) In paragraph 24C (initial determination under paragraph 24B(3) superseded
by later determination), in sub-paragraph (1)—

(a) in paragraph (a), at the end insert “to which paragraph 24B(2A) does
not apply”, and

(b) 20in paragraph (c)(i), after “electricity” insert “to which paragraph
24B(2A) does not apply”.

(4) In paragraph 62 (tax credits), in sub-paragraph (1)(bb), after “electricity”, in
both places, insert “to which paragraph 24B(2A) does not apply”.

(5) The amendments made by this section have effect in relation to carbon price
25support rate commodities brought onto, or arriving at, a CHPQA site of a
combined heat and power station in Great Britain on or after 1 April 2015.

Landfill tax

64 Landfill tax: rates from 1 April 2016

(1) Section 42 of FA 1996 (amount of landfill tax) is amended as follows.

(2) 30In subsection (1) (standard rate), for paragraph (a) (but not the “or” following
it) substitute—

“(a) £84.40 for each whole tonne disposed of and a proportionately
reduced sum for any additional part of a tonne,”.

(3) In subsection (2) (reduced rate for certain disposals), for the words from
35“reference” to the end substitute “reference to £84.40 were to £2.65.”

(4) The amendments made by this section have effect in relation to disposals made
(or treated as made) on or after 1 April 2016.

65 Landfill tax: material consisting of fines

Schedule 15 makes provision about the treatment of fines for the purposes of
40landfill tax.

Value added tax

66 VAT: refunds to certain charities

(1) In Part 2 of VATA 1994 (reliefs, exemptions and repayments), after section 33B
insert—

“33C 5Refunds of VAT to charities within section 33D

(1) This section applies to a charity that falls within any of the descriptions
in section 33D.

A charity to which this section applies is referred to in this section as a
“qualifying charity”.

(2) 10This section applies where—

(a) VAT is chargeable on—

(i) the supply of goods or services to a qualifying charity,

(ii) the acquisition of any goods from another member State
by a qualifying charity, or

(iii) 15the importation of any goods from a place outside the
member States by a qualifying charity, and

(b) the supply, acquisition or importation is not for the purpose of
any business carried on by the qualifying charity.

(3) The Commissioners shall, on a claim made by the qualifying charity at
20such time and in such form and manner as the Commissioners may
determine, refund to the qualifying charity the amount of the VAT so
chargeable.

(4) A claim under subsection (3) above in respect of a supply, acquisition
or importation must be made before the end of the period of 4 years
25beginning with the day on which the supply is made or the acquisition
or importation takes place.

(5) Subsection (6) applies where goods or services supplied to, or acquired
or imported by, a qualifying charity otherwise than for the purpose of
any business carried on by the qualifying charity cannot be
30conveniently distinguished from goods or services supplied to, or
acquired or imported by, the qualifying charity for the purpose of such
a business.

(6) The amount to be refunded under this section is such amount as
remains after deducting from the whole of the VAT chargeable on any
35supply to, or acquisition or importation by, the qualifying charity such
proportion of that VAT as appears to the Commissioners to be
attributable to the carrying on of the business.

(7) References in this section to VAT do not include any VAT which, by
virtue of an order under section 25(7), is excluded from credit under
40section 25.

33D Charities to which section 33C applies

Palliative care charities

(1) “Palliative care charity” means a charity the main purpose of which is
the provision of palliative care at the direction of, or under the

supervision of, a medical professional to persons who are in need of
such care as a result of having a terminal illness.

(2) In subsection (1) “medical professional” means—

(a) a registered medical practitioner, or

(b) 5a registered nurse.

Air ambulance charities

(3) “Air ambulance charity” means a charity the main purpose of which is
to provide an air ambulance service in pursuance of arrangements
made by, or at the request of, a relevant NHS body.

(4) 10In subsection (3) “relevant NHS body” means a body the main purpose
of which is to provide ambulance services and which is—

(a) an NHS foundation trust in England,

(b) an NHS trust in Wales,

(c) a Special Health Board constituted under section 2 of the
15National Health Service (Scotland) Act 1978, or

(d) a Health and Social Care trust established under the Health and
Personal Social Services (Northern Ireland) Order 1991.

Search and rescue charities

(5) “Search and rescue charity” means a charity that meets condition A or
20B.

(6) Condition A is that—

(a) the main purpose of the charity is to carry out search and rescue
activities in the United Kingdom or the UK marine area, and

(b) the search and rescue activities carried out by the charity are co-
25ordinated by a relevant authority.

(7) Condition B is that the main purpose of the charity is to support,
develop and promote the activities of a charity which meets condition
A.

(8) For the purposes of subsection (6)—

• 30“search and rescue activities” means searching for, and rescuing,
  persons who are, or may be, at risk of death or serious injury;

• “relevant authority” means—

  (a)

  the Secretary of State;

  (b)

  a police force;

  (c)

  35the Scottish Fire and Rescue Service;

  (d)

  any other person or body specified for the purposes of
  subsection (6) by an order made by the Treasury;

• “police force” means—

  (a)

  a police force within the meaning of the Police Act 1996;

  (b)

  40the Police Service of Scotland;

  (c)

  the Police Service of Northern Ireland;

  (d)

  the Police Service of Northern Ireland Reserve;

  (e)

  the British Transport Police Force;

  (f)

  the Civil Nuclear Constabulary;

  (g)

  45the Ministry of Defence Police;

Finance (No. 2) BillPage 74

• “UK marine area” has the meaning given by section 42(1) of the
  Marine and Coastal Access Act 2009.

Medical courier charities

(9) “Medical courier charity” means a charity that meets condition A or B.

(10) 5Condition A is that the main purpose of the charity is to provide
services for the transportation of items intended for use for medical
purposes, including in particular—

(a) blood;

(b) medicines and other medical supplies;

(c) 10items relating to people who are undergoing medical treatment.

(11) Condition B is that the main purpose of the charity is to support,
develop and promote the activities of a charity which meets condition
A.

(12) In subsection (10) “item” includes any substance.”

(2) 15In section 79 of VATA 1994 (repayment supplement in respect of certain
delayed payments or refunds)—

(a) in subsection (1), after paragraph (d) insert “or

(e) a charity which is registered is entitled to a refund under
section 33C,”;

(b) 20in subsection (5), after paragraph (d) insert “, and

(e) a supplement paid to a charity under subsection (1)(e)
shall be treated as an amount due to the charity by way
of refund under section 33C.”;

(c) in subsection (6)(b), for “or 33B” substitute “, 33B or 33C”.

(3) 25In section 90 of VATA 1994 (failure of resolution under Provisional Collection
of Taxes Act 1968), in subsection (3), after “33B,” insert “33C,”.

(4) In Schedule 9 to VATA 1994 (exemptions), in Group 14 (supplies of goods
where input tax cannot be recovered), in Note (9), after “33B,” insert “33C,”.

(5) The amendments made by this section have effect in relation to supplies made,
30and acquisitions and importations taking place, on or after 1 April 2015.

(6) Until section 179 of the Health and Social Care Act 2012 (which abolishes NHS
trusts in England) is fully brought into force, references in section 33D of
VATA 1994 to an NHS foundation trust in England include an NHS trust in
England.

67 35VAT: refunds to strategic highways companies

(1) In section 41 of VATA 1994 (application of Act to the Crown), in subsection
(7)—

(a) after “subsection (6)” insert “each of the following is to be regarded as
a body of persons exercising functions on behalf of a Minister of the
40Crown”,

(b) omit the “and” after paragraph (j), and

(c) for the words after paragraph (k) substitute—

“(l) a strategic highways company appointed under section
1 of the Infrastructure Act 2015.”

(2) The amendments made by this section come into force on 1 April 2015.

Stamp duty land tax

68 SDLT: alternative property finance relief

(1) FA 2003 is amended as follows.

(2) 5In section 73BA (meaning of “financial institution”), after subsection (2)
insert—

“(3) In sections 71A, 73AB and 73B, “financial institution” also includes a
person with permission under Part 4A of the Financial Services and
Markets Act 2000 to carry on the regulated activity specified in Article
1063F(1) of the Financial Services and Markets Act (Regulated Activities)
Order 2001 (S.I. 2001/544S.I. 2001/544) (entering into regulated home purchase
plans as home purchase provider).”

(3) In paragraph 9 of Schedule 4A (higher rate for certain SDLT transactions:
interpretation), for the definition of “financial institution” substitute—

• 15““financial institution” is to be read in accordance with subsections (1) and
  (2) of section 73BA and, in paragraphs 6A to 6H, also in accordance
  with subsection (3) of that section;”.

(4) The amendment made by subsection (2) has effect where the effective date of
the first transaction is, or is after, the day on which this Act is passed.

(5) 20In subsection (4) “first transaction” means the first transaction within the
meaning of section 71A(1)(a) of FA 2003.

69 SDLT: multiple dwellings relief

(1) After paragraph 2(6) of Schedule 6B to FA 2003 (stamp duty land tax: superior
interest in dwellings subject to a long lease excluded from multiple dwellings
25relief) insert—

“(7) Sub-paragraph (6) does not apply where—

(a) the vendor is a qualifying body within the meaning of
paragraph 5 of Schedule 9,

(b) the transaction is a sale under a sale and leaseback
30arrangement within the meaning of section 57A(2),

(c) that sale is the grant of a leasehold interest, and

(d) the leaseback element of that arrangement is exempt from
charge under section 57A.”

(2) The amendment made by this section has effect in relation to any land
35transaction of which the effective date is, or is after, the day on which this Act
is passed.

Annual tax on enveloped dwellings

70 ATED: annual chargeable amount

(1) In section 99 of FA 2013 (amount of tax chargeable), in the table in subsection

(4), for the last four entries substitute—

(2) The amendment made by subsection (1) has effect for the chargeable period
10beginning on 1 April 2015 and, subject to section 101 of FA 2013, for subsequent
chargeable periods.

(3) Section 101(1) of FA 2013 does not apply in relation to the chargeable period
beginning on 1 April 2015.

(4) Accordingly, the Treasury is not required to make an order under section
15101(5) of FA 2013 in respect of that period.

71 ATED: taxable value

In section 102 of FA 2013 (annual tax on enveloped dwellings: taxable value),
after subsection (2) insert—

“(2A) But a day that is a valuation date only because of subsection (2)(b) (a “5-
20yearly valuation date”) is to be treated as if it were not a valuation date
for the purpose of determining the taxable value of a single-dwelling
interest on any day in the chargeable period beginning with that 5-
yearly valuation date.”

72 ATED: interests held by connected persons

(1) 25Section 110 of FA 2013 (interests held by connected persons) is amended as
follows.

(2) In subsection (1), after “If on any day” insert “(“the relevant day”)”.

(3) In subsection (2)—

(a) omit “on the day in question”;

(b) 30after “P’s single dwelling interest” insert “on the relevant day”;

(c) for “£500,000” substitute “£250,000”.

(4) After subsection (2) insert—

“(2A) Subsection (2B) applies in any case where—

(a) C would (without subsection (2B)) be treated, as a result of
35subsection (1) (read with section 109), as entitled to a single-
dwelling interest with a taxable value (on the relevant day) of
more than £2 million, but

(b) C would not be so treated if the value specified in subsection (2)
were £500,000 (instead of £250,000).

(2B) Subsection (2) has effect as if the value specified in it were £500,000
(instead of £250,000).”

(5) The amendments made by this section have effect in relation to chargeable
periods beginning on or after 1 April 2015.

73 5ATED: returns

(1) Part 3 of FA 2013 (annual tax on enveloped dwellings) is amended as follows.

(2) In section 159 (annual tax on enveloped dwellings return), after subsection (3)
insert—

“(3A) Where a person—

(a) 10would (apart from this subsection) be required in accordance
with subsection (2) to deliver a return for a chargeable period
(“the later period”) by 30 April in that period, and

(b) is also required in accordance with subsection (3) to deliver a
return for the previous chargeable period by a date (“the later
15date”) which is later than 30 April in the later period,

subsection (2) has effect as if it required the return mentioned in
paragraph (a) to be delivered by the later date.”

(3) After section 159 insert—

“159A Relief declaration returns

(1) 20“Relief declaration return” means an annual tax on enveloped
dwellings return which—

(a) states that it is a relief declaration return,

(b) relates to one (and only one) of the types of relief listed in the
table in subsection (9), and

(c) 25specifies which type of relief it relates to.

(2) A relief declaration return may be made in respect of one or more
single-dwelling interests.

(3) A relief declaration return delivered to an officer of Revenue and
Customs on a particular day (“the day of the claim”) is treated as made
30in respect of any single-dwelling interest in relation to which the
conditions in subsection (4) are met (but need not contain information
which identifies the particular single-dwelling interest or interests
concerned).

(4) The conditions are that—

(a) 35the person making the return is within the charge with respect
to the single-dwelling interest on the day of the claim;

(b) the day of the claim is relievable in relation to the single-
dwelling interest by virtue of a provision which relates to the
type of relief specified in the return (see subsection (9));

(c) 40none of the days in the pre-claim period is a taxable day.

(5) The statement under subsection (1)(a) in a relief declaration return is
treated as a claim for interim relief (see section 100) with respect to the
single-dwelling interest (or interests) in respect of which the return is
made.

(6) Subsection (7) applies where—

(a) a person has delivered to an officer of Revenue and Customs on
any day a relief declaration return for a chargeable period with
respect to one or more single-dwelling interests (“the existing
5return”), and

(b) there is a subsequent day (“day S”) in the same chargeable
period on which the relevant conditions are met in relation to
another single-dwelling interest.

(7) The existing return is treated as also made with respect to that other
10single-dwelling interest.

(8) For the purposes of subsection (6)(b), the “relevant conditions” are the
same as the conditions in subsection (4), except that for this purpose
references in subsection (4) to the day of the claim are to be read as
references to day S.

(9) 15This table sets out the numbered types of relief to which the provisions
specified in the left hand column relate—

(10) 35Where a person—

(a) has failed to make annual tax on enveloped dwellings returns in
respect of two or more single-dwelling interests, and

(b) could have discharged the duties in question by making a single
relief declaration return in respect of all the interests,

40the failure may be taken, for the purposes of Schedule 55 to FA 2009, to
be a failure to make a single annual tax on enveloped dwellings return.

(11) In this section—

Finance (No. 2) BillPage 79

• “pre-claim period” has the same meaning as in section 100;

• “taxable day”, in relation to a person and a single-dwelling
  interest, means a day on which the person is within the charge
  with respect to the interest, other than a day which is relievable
  5in relation to the interest.”

(4) In section 161 (return to include self-assessment), for subsection (2)
substitute—

“(2) In subsection (1) “return” means—

(a) an annual tax on enveloped dwellings return, or

(b) 10a return of the adjusted chargeable amount.

(2A) The reference in subsection (2)(a) to an annual tax on enveloped
dwellings return does not include a relief declaration return.”

(5) In Schedule 33 (annual tax on enveloped dwellings: returns etc)—

(a) in paragraph 2(a), after “159” insert “, 159A”;

(b) 15in paragraph 20(1), for “in question, the self assessment included in that
return” substitute “in question containing a self assessment, that self
assessment.”

(6) The amendments made by subsections (1) to (5) have effect for chargeable
periods beginning on or after 1 April 2015.

(7) 20In a case (not falling within section 109(5) of FA 2014) which falls within
subsection (8), section 159 of FA 2013 (annual tax on enveloped dwellings
return) has effect with the same modifications as are set out in section 109(6) of
FA 2014 (which provides for extended filing periods in certain cases).

(8) The case is where—

(a) 25a person has a duty to deliver to an officer of Revenue and Customs an
annual tax on enveloped dwellings return with respect to a single-
dwelling interest for the chargeable period beginning with 1 April 2015,
and

(b) the circumstances on the first day in that chargeable period on which
30that person is within the charge with respect to that single-dwelling
interest are such that that duty could be discharged by the delivery to
an officer of Revenue and Customs on that day of a relief declaration
return.

Inheritance tax

74 35Inheritance tax: exemption for decorations and other awards

(1) In section 6 of IHTA 1984 (excluded property), for subsection (1B) substitute—

“(1B) A relevant decoration or award is excluded property if it has never
been the subject of a disposition for a consideration in money or
money’s worth.

(1BA) 40In subsection (1B) “relevant decoration or award” means a decoration
or other similar award—

(a) that is designed to be worn to denote membership of—