Finance (No. 2) Bill (HC Bill 155)

(3) In subsection (2) “relevant percentage” means the percentage specified
in the last row of the third column of the Table in Schedule 1.

(4) For the purposes of this section, a “qualifying payment” is a payment
that meets Condition A, B or C.

(5) 5Condition A is that the payment—

(a) is of a kind specified in Part 1 of Schedule 5A, and

(b) is made to a person, or the personal representatives of a person,
who was—

(i) a victim of National-Socialist persecution, or

(ii) 10the spouse or civil partner of a person within sub-
paragraph (i).

(6) Condition B is that the payment is of a kind listed in Part 2 of Schedule
5A.

(7) Condition C is that the payment—

(a) 15is of a kind specified in regulations made by the Treasury, and

(b) is made to a person, or the personal representatives of a person,
who was—

(i) held as a prisoner of war, or a civilian internee, during
the Second World War, or

(ii) 20the spouse or civil partner of a person within sub-
paragraph (i).

(8) The Treasury may by regulations add a payment of a specified kind to
the list in Part 1 of Schedule 5A.

(9) Regulations under this section are to be made by statutory instrument.

(10) 25A statutory instrument containing regulations under this section is
subject to annulment in pursuance of a resolution of the House of
Commons.”

(2) After Schedule 5 to IHTA 1984 insert—

Section 153ZA

““Schedule 5A Qualifying payments: victims of persecution during Second World War
30era

Part 1 Compensation payments

1 A payment of a fixed amount from the German foundation known as
“Remembrance, Responsibility and Future” (Stiftung EVZ) in respect
35of a person who was a slave or forced labourer.

2 A payment of a fixed amount in accordance with the arrangements
made under the Swiss Bank Settlement (Holocaust Victim Assets
Litigation) in respect of the slave or forced labourers qualifying for
compensation under the Remembrance, Responsibility and Future
40scheme.

3 A payment of a fixed amount from the Hardship Fund established by
the Government of the Federal Republic of Germany.

4 A payment of a fixed amount from the National Fund of the Republic
of Austria for Victims of National-Socialism under the terms of the
5scheme as at June 1995.

5 A payment of a fixed amount in respect of a slave or forced labourer
from the Austrian Reconciliation Fund.

6 A payment of a fixed amount by the Swiss Refugee Programme in
accordance with the arrangements made under the Swiss Bank
10Settlement (Holocaust Victim Assets Litigation) in respect of
refugees.

7 A payment of a fixed amount under the foundation established in the
Netherlands and known as the Dutch Maror Fund (Stichting Maror-
Gelden Overheid).

8 15A one-off payment of a fixed amount from the scheme established by
the Government of the French Republic and known as the French
Orphan Scheme.

9 A payment of a fixed amount from the Child Survivor Fund
established by the Government of the Federal Republic of Germany.

20Part 2 Ex-gratia payments

10 A payment of a fixed amount made from the scheme established by
the United Kingdom Government and known as the Far Eastern
Prisoners of War Ex Gratia Scheme.”

(3) 25The amendments made by this section have effect in relation to deaths
occurring on or after 1 January 2015.

85 Inheritance tax: gifts for national purposes etc

(1) The Schedule 3 IHTA approval function is transferred to the Treasury.

(2) The “Schedule 3 IHTA approval function” is the function of approval conferred
30by Schedule 3 to IHTA 1984 in the entry beginning “Any other similar national
institution” (and which was initially conferred on the Treasury but, along with
other functions, transferred to the Commissioners of Inland Revenue under
section 95 of FA 1985).

(3) Subsection (1) does not affect any approval given under Schedule 3 to IHTA
351984 before this Act is passed.

(4) In Schedule 3 to IHTA 1984 (gifts for national purposes, etc), in the entry
beginning “Any museum”, after “and is” insert “or has been”.

86 Estate duty: objects of national, scientific, historic or artistic interest

(1) Section 40 of FA 1930 and section 2 of the Finance Act (Northern Ireland) 1931
40(exemption from death duties of objects of national etc interest), so far as
continuing to have effect, have effect as if after subsection (2) there were

inserted—

“(2A) In the event of the loss of any objects to which this section applies, estate
duty shall become chargeable on the value of those objects in respect of
the last death on which the objects passed at the rate appropriate to the
5principal value of the estate passing on that death upon which estate
duty is leviable, and with which the objects would have been
aggregated if they had not been objects to which this section applies.

(2B) Where subsection (2A) applies, any owner of the objects—

(a) shall be accountable for the estate duty, and

(b) 10shall deliver an account for the purposes thereof.

(2C) The account under subsection (2B)(b) must be delivered within the
period of one month beginning with—

(a) in the case of a loss occurring before the coming into force of
subsection (2A)—

(i) 15the coming into force of subsection (2A), or

(ii) if later, the date when the owner became aware of the
loss;

(b) in the case of a loss occurring after the coming into force of
subsection (2A)—

(i) 20the date of the loss, or

(ii) if later, the date when the owner became aware of the
loss.

This is subject to subsection (2E).

(2D) Subsection (2E) applies if—

(a) 25no account has been delivered under subsection (2B),

(b) the Commissioners for Her Majesty’s Revenue and Customs
have by notice required an owner of the objects to confirm that
the objects have not been lost,

(c) the owner has not so confirmed by the end of—

(i) 30the period of three months beginning with the day on
which the notice was sent, or

(ii) such longer period as the Commissioners may allow,
and

(d) the Commissioners are satisfied that the objects are lost.

(2E) 35Where this subsection applies—

(a) the objects are to be treated as lost for the purposes of subsection
(2A) on the day on which the Commissioners are satisfied as
specified in subsection (2D)(d), and

(b) the account under subsection (2B)(b) must be delivered within
40the period of one month beginning with that date.

(2F) The reference in subsection (2A) to the value of objects is to their value
at the time they are lost (or treated as lost).

(2G) Subsection (2A) does not apply in relation to a loss notified to the
Commissioners before the coming into force of that subsection.

(2H) 45In this section “owner”, in relation to any objects, means a person who,
if the objects were sold, would be entitled to receive (whether for their

own benefit or not) the proceeds of sale or any income arising
therefrom.

(2I) In this section references to the loss of objects include their theft or
destruction; but do not include a loss which the Commissioners are
5satisfied was outside the owner’s control.”

(2) Section 48 of FA 1950, so far as continuing to have effect, has effect as if after
subsection (4) there were inserted—

“(5) Where any objects are lost (within the meaning of the said section forty)
after becoming chargeable with estate duty under this section in respect
10of any death, the value of those objects shall not be chargeable with
estate duty under subsection (2A) of the said section forty.”

(3) Section 39 of FA 1969, so far as continuing to have effect, has effect as if—

(a) in subsection (1)—

(i) after “subsection (2)” there were inserted “or (2A)”;

(ii) 15after “other disposal” there were inserted “or loss”;

(b) in subsection (2), after “subsection (2)” there were inserted “, (2A)”;

(c) in subsection (3)—

(i) after “subsection (2)” there were inserted “, (2A)”;

(ii) for the words from “the amount” to the end there were
20substituted “the amount in respect of which estate duty is
chargeable under the said subsection”.

(4) Section 6 of the Finance Act (Northern Ireland) 1969, so far as continuing to
have effect as originally enacted, has effect as if—

(a) in subsection (1)—

(i) 25after “subsection (2)” there were inserted “or (2A)”;

(ii) after “sale” there were inserted “or loss”;

(b) in subsection (2)—

(i) for “sale” there were substituted “event”;

(ii) after “subsection (2)” there were inserted “or (2A)”;

(c) 30in subsection (3)—

(i) for “sale” there were substituted “event”;

(ii) after “subsection (2)” there were inserted “or (2A)”;

(iii) for “the amount of the proceeds of sale” there were substituted
“the amount in respect of which estate duty is chargeable under
35the said subsection”.

(5) Section 6 of the Finance Act (Northern Ireland) 1969, so far as continuing to
have effect as amended by Article 7 of the Finance (Northern Ireland) Order
1972 (S.I. 1972/1100 (N.I.11)S.I. 1972/1100 (N.I.11)) (deaths occurring after the making of that Order),
has effect as if—

(a) 40in subsection (1)—

(i) after “subsection (2)” there were inserted “or (2A)”;

(ii) after “sale” there were inserted “or loss”;

(b) in subsection (2), after “subsection (2)” there were inserted “or (2A)”;

(c) in subsection (3)—

(i) 45in the opening words, after “subsection (2)” there were inserted
“or (2A)”;

(ii) in paragraphs (a) and (b), after “otherwise than on sale” there
were inserted “or at the time of the loss”.

(6) In Schedule 6 to IHTA 1984 (transition from estate duty), in paragraph 4
(objects of national etc interest left out of account on death), in sub-paragraph
5(2), for paragraphs (a) and (b) substitute—

“(a) tax shall be chargeable under section 32 or 32A of this Act (as
the case may be), or

(b) estate duty shall be chargeable under those provisions,

as the Board may elect,”.

(7) 10Subsection (6) has effect in relation to a chargeable event where the
conditionally exempt transfer referred to in paragraph 4(2) of Schedule 6 to
IHTA 1984 occurred after 16 March 2016.

Part 6 Apprenticeship levy

15Basic provisions

87 Apprenticeship levy

(1) A tax called apprenticeship levy is to be charged in accordance with this Part.

(2) The Commissioners are responsible for the collection and management of
apprenticeship levy.

88 20Charge to apprenticeship levy

(1) Apprenticeship levy is charged if—

(a) a person has a pay bill for a tax year, and

(b) the relevant percentage of that pay bill exceeds the amount of the
person’s levy allowance (if any) for that tax year.

(2) 25The amount charged for the tax year is equal to—

N is the relevant percentage of the pay bill for the tax year, and

A is the amount of the levy allowance (if any) to which the person is entitled
30for the tax year.

(3) The person mentioned in subsection (1) is liable to pay the amount charged.

(4) Except so far as any of sections 90 to 92 provides otherwise, a person who has
a pay bill for a tax year is entitled to a levy allowance of £15,000 for the tax year.

(5) For the purposes of this section the “relevant percentage” is 0.5%.

89 A person’s pay bill for a tax year

(1) A person has a pay bill for a tax year if, in the tax year—

(a) the person is the secondary contributor in relation to payments of
earnings to, or for the benefit of, one or more employed earners, and

(b) 5in consequence, the person incurs liabilities to pay secondary Class 1
contributions.

(2) The amount of the person’s pay bill for the tax year is equal to the total amount
of the earnings in respect of which the liabilities mentioned in subsection (1)(b)
are incurred.

(3) 10For the purposes of this section a person is treated as incurring, in respect of
any earnings, any liabilities which the person would incur but for the condition
in section 6(1)(b) of the Contributions and Benefits Act.

(4) The Treasury may by regulations provide for persons specified in certificates
in force under section 120(4) of the Social Security Contributions and Benefits
15Act 1992 to be treated for the purposes of this section as the secondary
contributor in relation to payments of earnings to which the certificate relates
and as liable to pay secondary Class 1 contributions to which the certificate
relates.

(5) For the purposes of this section—

(a) 20references to “payments of earnings” are to be interpreted as they
would be interpreted for the purposes of determining liability to pay
secondary Class 1 contributions under the Contributions and Benefits
Act;

(b) the amount of any earnings is to be calculated in the same manner and
25on the same basis as for the purpose of calculating the liabilities
mentioned in subsection (1)(b).

(6) In this section references to liability to pay secondary Class 1 contributions are
to liability to pay secondary Class 1 contributions under Part 1 of the
Contributions and Benefits Act (and are therefore to be interpreted in
30accordance with sections 9A(6) and 9B(3) of that Act).

Connected companies and charities

90 Connected companies

(1) This section applies if—

(a) at the beginning of a tax year two or more companies which are not
35charities are connected with one another, and

(b) apart from this section, two or more of the companies (the “qualified
companies”) would be entitled to a levy allowance for the tax year.

(2) Only one of the qualified companies can be entitled to a levy allowance for the
tax year.

(3) 40It is up to the qualified companies to decide which of them that is to be.

(4) Part 1 of Schedule 1 to the National Insurance Contributions Act 2014 (rules for
determining whether companies are “connected” with one another) applies for
the purposes of subsection (1) as it applies for the purposes of section 3(1) of
that Act.

(5) In this section “company” has the meaning given by section 1121(1) of CTA
2010 and includes a limited liability partnership.

(6) See section 91 for the meaning of “charity”.

91 Connected charities

(1) 5This section applies if—

(a) at the beginning of a tax year two or more charities are connected with
one another, and

(b) apart from this section, two or more of the charities (the “qualified
charities”) would be entitled to a levy allowance for the tax year.

(2) 10Only one of the qualified charities can be entitled to a levy allowance for the
tax year.

(3) It is up to the qualified charities to decide which of them that is to be.

(4) In this Part “charity” means—

(a) a charity within the meaning of Part 1 of Schedule 6 to FA 2010;

(b) 15the Trustees of the National Heritage Memorial Fund;

(c) the Historic Buildings and Monuments Commission for England;

(d) a registered club within the meaning of Chapter 9 of Part 13 of CTA
2010 (community amateur sports clubs).

(5) Subsection (4) is subject to section 107(5).

(6) 20See sections 107 and 108 for provision about the meaning of “connected” in
subsection (1).

Anti-avoidance

92 Anti-avoidance

(1) For the purposes of this section “avoidance arrangements” are arrangements
25the main purpose, or one of the main purposes, of which is to secure that a
person—

(a) benefits, or further benefits, from an entitlement to a levy allowance for
a tax year, or

(b) otherwise obtains an advantage in relation to apprenticeship levy.

(2) 30Subsection (3) applies where, in consequence of avoidance arrangements
within subsection (1)(a) or (b), a person incurs a liability to pay secondary Class
1 contributions in a particular tax year (as opposed to another tax year).

(3) If the person would (apart from this subsection) obtain an advantage in
relation to apprenticeship levy as a result of incurring the liability at the time
35mentioned in subsection (2), section 89 has effect as if the liability had been
incurred when it would have been incurred but for the avoidance
arrangements.

(4) Subsection (6) applies where (apart from this section) a person (“P”)—

(a) would be in a position to use or make greater use of a levy allowance
40for a tax year, in consequence of avoidance arrangements within
subsection (1)(a), or

(b) would otherwise obtain an advantage in relation to apprenticeship levy
in consequence of avoidance arrangements within subsection (1)(a).

(5) But subsection (6) only applies so far as the advantage in relation to
apprenticeship levy cannot be counteracted under subsection (3).

(6) 5P is not entitled to an annual allowance for the tax year.

(7) In this section “arrangements” includes any agreement, understanding,
scheme, transaction or series of transactions (whether or not legally
enforceable).

(8) In this section a reference to “an advantage in relation to apprenticeship levy”
10includes a reference to—

(a) repayment or increased repayment of apprenticeship levy,

(b) avoidance or reduction of a charge, or an assessment, to the levy,

(c) avoidance of a possible assessment to the levy,

(d) deferral of a payment of, or advancement of a repayment of, the levy,
15and

(e) avoidance of an obligation to account for the levy.

(9) Sections 90 and 91 are to be ignored for the purpose of determining under
subsection (4) what the position would be apart from this section.

(10) In subsection (2) the reference to “a particular tax year” is to be read as
20including a reference to the period of 12 months beginning with 6 April 2016.

93 Application of other regimes to apprenticeship levy

(1) In section 318(1) of FA 2004 (disclosure of tax avoidance schemes:
interpretation), in the definition of “tax”, after paragraph (d) insert—

“(da) apprenticeship levy,”.

(2) 25In section 206(3) of FA 2013 (taxes to which the general anti-abuse rule applies),
after paragraph (da) insert—

“(db) apprenticeship levy,”.

(3) Part 4 of FA 2014 (follower notices and accelerated payments) is amended in
accordance with subsections (4) and (5).

(4) 30In section 200 (meaning of “relevant tax”), after paragraph (c) insert—

“(ca) apprenticeship levy,”.

(5) In section 203 (meaning of “tax appeal”), after paragraph (e) insert—

“(ea) an appeal under section 103 of FA 2016 (apprenticeship levy:
appeal against an assessment),”.

(6) 35Part 5 of FA 2014 (promoters of tax avoidance schemes) is amended in
accordance with subsections (7) and (8).

(7) In section 253(6) (duty to notify the Commissioners: meaning of “tax return”),
after paragraph (d) insert—

“(da) a return under regulations made under section 94 of FA 2016
40(apprenticeship levy);”.

(8) In section 283(1) (interpretation), in the definition of “tax”, after paragraph (d)

insert—

“(da) apprenticeship levy,”.

Payment, collection and recovery

94 Assessment, payment etc

(1) 5The Commissioners may by regulations make provision about the assessment,
payment, collection and recovery of apprenticeship levy.

(2) Regulations under subsection (1) may include—

(a) provision which applies, with or without modifications, provisions of
PAYE regulations;

(b) 10provision for combining any arrangements under the regulations with
arrangements under PAYE regulations.

(3) Regulations under subsection (1) may—

(a) require payments to be made on account of apprenticeship levy;

(b) determine periods (“tax periods”) by reference to which payments are
15to be made;

(c) make provision about the times at which payments are to be made and
methods of payment;

(d) require the amounts payable by reference to tax periods to be calculated
(and levy allowance to be taken into account) in the manner and on the
20basis determined by or under the regulations;

(e) make provision for dealing with cases where such calculations lead to
overpayment of levy (by repayment or otherwise);

(f) make other provision about the recovery of overpayments of levy.

(4) Regulations under subsection (1) may make provision requiring persons to
25make returns, including provision about—

(a) the periods by reference to which returns are to be made,

(b) the information to be included in returns,

(c) timing, and

(d) the form of, and method of making, returns.

(5) 30Regulations under subsection (1) may—

(a) authorise HMRC to assess to the best of their judgement amounts
payable by a person in respect of apprenticeship levy;

(b) make provision about the treatment of amounts so assessed, including
provision for treating such amounts as apprenticeship levy payable by
35the person;

(c) make provision about the process of assessments.

(6) Regulations under subsection (1) may make, in relation to amounts of
apprenticeship levy which have been repaid to a person and ought not to have
been repaid, any provision which may be made in relation to apprenticeship
40levy payable by a person.

(7) Where—

(a) a repayment of apprenticeship levy has been increased in accordance
with section 102 of FA 2009 (repayment interest), and

(b) the whole or part of the repayment has been paid to any person but
ought not to have been paid to the person,

any amount by which the repayment paid to the person ought not to have been
increased is to be treated for the purposes of regulations made by virtue of
5subsection (6) as if it were an amount of apprenticeship levy repaid to the
person which ought not to have been repaid.

(8) Regulations under subsection (1) may make provision for enabling the
repayment or remission of interest under section 101 of FA 2009.

(9) The provision that may be made under subsection (1) includes—

(a) 10provision for the making of decisions (other than relevant assessments)
by HMRC as to any matter required to be decided for the purposes of
the regulations and for appeals against such decisions;

(b) provision for appeals with respect to matters arising under the
regulations which would otherwise not be the subject of an appeal;

(c) 15provision for the way in which any matters provided for by the
regulations are to be proved.

(10) In subsection (9) “relevant assessment” means an assessment of amounts
payable by a person in respect of apprenticeship levy.

(11) Regulations under this subsection (1) must not affect any right of appeal to the
20tribunal which a person would have apart from the regulations.

(12) In this section (except where the context requires otherwise) references to
payments are to payments of, or on account of, apprenticeship levy.

95 Recovery from third parties

(1) Regulations under section 94(1) may make corresponding provision for the
25recovery of amounts in respect of apprenticeship levy from persons other than
the person liable to pay the amounts by virtue of section 88(3).

(2) In subsection (1) “corresponding provision” means provision which
corresponds to provision made by regulations under the Contributions and
Benefits Act for secondary Class 1 contributions in respect of any earnings to
30be recovered from a person other than the secondary contributor.

96 Real time information

(1) Regulations under section 94(1) may make provision—

(a) for authorising or requiring relevant service providers to supply to
HMRC information about payments of apprenticeship levy with
35respect to which their service is provided, or any information the
Commissioners may request about features of the service provided or
to be provided with respect to particular payments of apprenticeship
levy;

(b) for requiring clients to provide relevant service providers with
40information about payments of apprenticeship levy;

(c) for prohibiting or restricting the disclosure, otherwise than to HMRC,
of information by a person to whom it was supplied pursuant to a
requirement imposed under paragraph (b);