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

(10) For the purposes of this section a person is “UK-established” if the
person is established in the United Kingdom within the meaning of
Article 10 of Implementing Regulation (EU) No 282/2011.

(11) The Treasury may by regulations provide that supplies made or goods
5offered for sale in circumstances specified in the regulations are, or are
not, to be treated for the purposes of this section as having been made
or offered through an online marketplace.

(12) The Treasury may by regulations amend this section so as to alter the
meaning of—

• 10“online marketplace”,

• “operator”, and

• “UK-established”.

77C Joint and several liability under section 77B: assessments

(1) The Commissioners may assess the amount of VAT due from the
15operator of an online marketplace by virtue of section 77B to the best of
their judgment and notify it to the operator.

(2) Subject to subsections (3) to (6), an assessment may be made for such
period or periods as the Commissioners consider appropriate.

(3) An assessment for any month may not be made after the end of—

(a) 202 years after the end of that month, or

(b) (if later) one year after evidence of facts, sufficient in the opinion
of the Commissioners to justify the making of an assessment for
that month, comes to their knowledge.

(4) Subsection (5) applies if, after the Commissioners have made an
25assessment for a period, evidence of facts sufficient in the opinion of the
Commissioners to justify the making of a further assessment for that
period comes to their knowledge.

(5) The Commissioners may, no later than one year after that evidence
comes to their knowledge, make a further assessment for that period
30(subject to subsection (6)).

(6) An assessment or further assessment for a month may not be made
more than 4 years after the end of the month.

(7) An amount which has been assessed and notified to a person under this
section is deemed to be an amount of VAT due from the person and
35may be recovered accordingly (unless, or except to the extent that, the
assessment is subsequently withdrawn or reduced).

(8) Subsection (7) is subject to the provisions of this Act as to appeals.

(9) Expressions used in this section and in section 77B have the same
meaning in this section as in section 77B.

77D 40Joint and several liability under section 77B: interest

(1) If an amount assessed under section 77C is not paid before the end of
the period of 30 days beginning with the day on which notice of the
assessment is given, the amount assessed carries interest from the day
on which the notice of assessment is given until payment.

(2) Interest under this section is payable at the rate applicable under
section 197 of the Finance Act 1996.

(3) Where the operator of an online marketplace is liable for interest under
this section the Commissioners may assess the amount due and notify
5it to the operator.

(4) A notice of assessment under this section must specify a date (not later
than the date of the notice) to which the interest is calculated.

(5) A further assessment or assessments may be made under this section in
respect of any interest accrued after that date.

(6) 10An amount of interest assessed and notified to the operator of an online
marketplace under this section is recoverable as if it were VAT due
from the operator (unless, or except to the extent that, the assessment is
withdrawn or reduced).

(7) Interest under this section is to be paid without any deduction of
15income tax.

(8) Expressions used in this section and in section 77B have the same
meaning in this section as in section 77B.”

(3) In section 83(1) (appeals) after paragraph (ra) insert—

“(rb) an assessment under section 77C or the amount of such an
20assessment;”.

(4) In section 84 (further provision relating to appeals)—

(a) in subsection (3) after “(ra)” insert “, (rb)”, and

(b) in subsection (5) after “83(1)(p)” insert “or (rb)”.

114 VAT: Isle of Man charities

25In Schedule 6 to FA 2010 (charities etc), in paragraph 2(2) (jurisdiction
condition: meaning of “a relevant UK court”), after paragraph (c) (and on a new
line) insert “(and, for enactments relating to value added tax, includes the High
Court of the Isle of Man).”

115 VAT: women’s sanitary products

(1) 30VATA 1994 is amended as follows.

(2) In Schedule 7A (reduced rate)—

(a) in Part 1 (index), omit the entry relating to women’s sanitary products;

(b) in Part 2 (the Groups), omit Group 4 (women’s sanitary products).

(3) In Schedule 8 (zero-rating), in Part 1 (index), at the end insert—

(4) In Schedule 8, in Part 2 (the Groups), after Group 18 insert—

““Group 19 - women’s sanitary products

Item No.

The supply of women’s sanitary products.

NOTES

(1) In this Group “women’s sanitary products” means women’s sanitary
products of any of the following descriptions—

(a) 5subject to Note (2), products that are designed, and marketed,
as being solely for use for absorbing, or otherwise collecting,
lochia or menstrual flow;

(b) panty liners, other than panty liners that are designed as
being primarily for use as incontinence products;

(c) 10sanitary belts.

(2) Note (1)(a) does not include protective briefs or any other form of
clothing.”

(5) The amendments made by this section have effect in relation to supplies made,
and acquisitions and importations taking place, on or after such day as the
15Treasury may by regulations made by statutory instrument appoint.

Part 8 SDLT and ATED

Stamp duty land tax

116 SDLT: calculating tax on non-residential and mixed transactions

(1) 20Section 55 of FA 2003 (general rules on calculating the amount of stamp duty
land tax chargeable) is amended in accordance with subsections (2) to (7).

(2) In subsection (1) for “, (1C) and (2)” substitute “and (1C)”.

(3) In subsection (1B)—

(a) omit the words from “the relevant land” to “and”,

(b) 25in Step 1—

(i) for “Table A” substitute “the appropriate table”,

(ii) for “that Table” substitute “the appropriate table”,

(iii) at the end insert—

“The “appropriate table” is—

• 30Table A, if the relevant land consists entirely of
  residential property, and

• Table B, if the relevant land consists of or includes land
  that is not residential property.”, and

(c) after Table A insert—

35“Table B: Non-residential or mixed

(4) In subsection (1C)—

(a) omit the words from “the relevant land” to “and” (in the first place it
5occurs),

(b) in Step 1—

(i) for “Table A” substitute “the appropriate table”,

(ii) for “that Table” substitute “the appropriate table”,

(iii) at the end insert—

10“The “appropriate table” is—

• Table A, if the relevant land consists entirely of
  residential property, and

• Table B, if the relevant land consists of or includes land
  that is not residential property.”

(5) 15Omit subsection (2).

(6) In subsection (3)—

(a) in the words before paragraph (a), for “subsections (1B) and (2)”
substitute “subsection (1B)”, and

(b) in paragraph (b) omit “, subject as follows”.

(7) 20In subsection (4)—

(a) in the words before paragraph (a), for the words from “subsections
(1C)” to “linked transactions” substitute “subsection (1C)”, and

(b) in paragraph (a) for “those” substitute “the linked”.

(8) Schedule 5 to FA 2003 (rules on calculating the amount of stamp duty land tax
25chargeable in respect of transactions for which the consideration consists of or
includes rent) is amended in accordance with subsections (9) to (11).

(9) In paragraph 2(3) (calculation of tax chargeable in respect of rent) in Table B
(bands and percentages for non-residential or mixed property) for the final
entry substitute—

(10) In paragraph 9 (tax chargeable in respect of consideration other than rent:
general), in sub-paragraph (1), omit “(but see paragraph 9A)”.

(11) Omit paragraph 9A (calculation of tax chargeable in respect of consideration
other than rent: 0% band) and the cross-heading preceding it.

(12) 40The amendments made by this section have effect in relation to any land
transaction of which the effective date is, or is after, 17 March 2016.

(13) But those amendments do not have effect in relation to a transaction if the
purchaser so elects and either—

(a) the transaction is effected in pursuance of a contract entered into and
substantially performed before 17 March 2016, or

(b) 5the transaction is effected in pursuance of a contract entered into before
that date and is not excluded by subsection (15).

(14) An election under subsection (13)—

(a) must be included in the land transaction return made in respect of the
transaction or in an amendment of that return, and

(b) 10must comply with any requirements specified by the Commissioners
for Her Majesty’s Revenue and Customs as to its form or the manner of
its inclusion.

(15) A transaction effected in pursuance of a contract entered into before 17 March
2016 is excluded by this subsection if—

(a) 15there is any variation of the contract, or assignment of rights under the
contract, on or after 17 March 2016,

(b) the transaction is effected in consequence of the exercise on or after that
date of any option, right of pre-emption or similar right, or

(c) on or after that date there is an assignment, subsale or other transaction
20relating to the whole or part of the subject-matter of the contract as a
result of which a person other than the purchaser under the contract
becomes entitled to call for a conveyance.

(16) In this section—

• “land transaction return”, in relation to a transaction, means the return
  25under section 76 of FA 2003 in respect of that transaction;

• “purchaser” has the same meaning as in Part 4 of that Act (see section
  43(4) of that Act);

• “substantially performed”, in relation to a contract, has the same meaning
  as in that Part (see section 44(5) of that Act).

117 30SDLT: higher rates for additional dwellings etc

(1) FA 2003 is amended in accordance with subsections (2) to (4).

(2) In section 55 (amount of tax chargeable: general) after subsection (4) insert—

“(4A) Schedule 4ZA (higher rates for additional dwellings and dwellings
purchased by companies) modifies this section as it applies for the
35purpose of determining the amount of tax chargeable in respect of
certain transactions involving major interests in dwellings.”

(3) After Schedule 4 insert—

““Schedule 4ZA Stamp duty land tax: higher rates for additional dwellings and
dwellings purchased by companies

40Part 1 Higher rates

1 (1) In its application for the purpose of determining the amount of tax

chargeable in respect of a chargeable transaction which is a higher
rates transaction, section 55 (amount of tax chargeable: general) has
effect with the modification in sub-paragraph (2).

(2) In subsection (1B) of section 55, for Table A substitute—

5“Table A: Residential

Part 2 20Meaning of “higher rates transaction”

Meaning of “higher rates transaction” etc

2 (1) This paragraph explains how to determine whether a chargeable
transaction is a “higher rates transaction” for the purposes of
paragraph 1.

(2) 25In the case of a transaction where there is only one purchaser,
determine whether the transaction falls within any of paragraphs 3
to 7; if it does fall within any of those paragraphs it is a “higher rates
transaction” (otherwise it is not).

(3) In the case of a transaction where there are two or more purchasers—

(a) 30take one of the purchasers and determine, having regard to
that purchaser only, whether the transaction falls within any
of paragraphs 3 to 7, and

(b) do the same with each of the other purchasers.

If the transaction falls within any of those paragraphs when having
35regard to any one of the purchasers it is a “higher rates transaction”
(otherwise it is not).

(4) For the purposes of this Schedule any term of years absolute or
leasehold estate is not a “major interest” if its term does not exceed 7
years on the date of its grant.

Single dwelling transactions

3 (1) A chargeable transaction falls within this paragraph if—

(a) the purchaser is an individual,

(b) the main subject-matter of the transaction consists of a major
5interest in a single dwelling (“the purchased dwelling”), and

(c) Conditions A to D are met.

(2) Condition A is that the chargeable consideration for the transaction
is £40,000 or more.

(3) Condition B is that on the effective date of the transaction the
10purchased dwelling—

(a) is not subject to a lease upon which the main subject-matter
of the transaction is reversionary, or

(b) is subject to such a lease but the lease has an unexpired term
of no more than 21 years.

(4) 15Condition C is that at the end of the day that is the effective date of
the transaction—

(a) the purchaser has a major interest in a dwelling other than the
purchased dwelling,

(b) that interest has a market value of £40,000 or more, and

(c) 20that interest is not reversionary on a lease which has an
unexpired term of more than 21 years.

(5) Condition D is that the purchased dwelling is not a replacement for
the purchaser’s only or main residence.

(6) For the purposes of sub-paragraph (5) the purchased dwelling is a
25replacement for the purchaser’s only or main residence if—

(a) on the effective date of the transaction (“the transaction
concerned”) the purchaser intends the purchased dwelling to
be the purchaser’s only or main residence,

(b) in another land transaction (“the previous transaction”)
30whose effective date was during the period of three years
ending with the effective date of the transaction concerned,
the purchaser or the purchaser’s spouse or civil partner at the
time disposed of a major interest in another dwelling (“the
sold dwelling”),

(c) 35at any time during that period of three years the sold
dwelling was the purchaser’s only or main residence, and

(d) at no time during the period beginning with the effective date
of the previous transaction and ending with the effective date
of the transaction concerned has the purchaser or the
40purchaser’s spouse or civil partner acquired a major interest
in any other dwelling with the intention of it being the
purchaser’s only or main residence.

(7) For the purposes of sub-paragraph (5) the purchased dwelling may
become a replacement for the purchaser’s only or main residence
45if—

(a) on the effective date of the transaction (“the transaction
concerned”) the purchaser intended the purchased dwelling
to be the purchaser’s only or main residence,

(b) in another land transaction whose effective date is during the
period of three years beginning with the day after the
effective date of the transaction concerned, the purchaser or
the purchaser’s spouse or civil partner disposes of a major
5interest in another dwelling (“the sold dwelling”), and

(c) at any time during the period of three years ending with the
effective date of the transaction concerned the sold dwelling
was the purchaser’s only or main residence.

4 A chargeable transaction falls within this paragraph if—

(a) 10the purchaser is not an individual,

(b) the main subject-matter of the transaction consists of a major
interest in a single dwelling, and

(c) Conditions A and B in paragraph 3 are met.

Multiple dwelling transactions

5 (1) 15A chargeable transaction falls within this paragraph if—

(a) the purchaser is an individual,

(b) the main subject-matter of the transaction consists of a major
interest in two or more dwellings (“the purchased
dwellings”), and

(c) 20Conditions A and B are met in respect of at least two of the
purchased dwellings.

(2) Condition A is that the portion of the chargeable consideration for
the transaction which is attributable on a just and reasonable basis to
the purchased dwelling is £40,000 or more.

(3) 25Condition B is that on the effective date of the transaction the
purchased dwelling—

(a) is not subject to a lease upon which the main subject-matter
of the transaction is reversionary, or

(b) is subject to such a lease but the lease has an unexpired term
30of no more than 21 years.

6 (1) A chargeable transaction falls within this paragraph if—

(a) the purchaser is an individual,

(b) the main subject-matter of the transaction consists of a major
interest in two or more dwellings (“the purchased
35dwellings”),

(c) Conditions A and B in paragraph 5 are met in respect of one
of the purchased dwellings,

(d) the purchased dwelling in respect of which those conditions
are met is not a replacement for the purchaser’s only or main
40residence, and

(e) at the end of the day that is the effective date of the
transaction—

(i) the purchaser has a major interest in a dwelling other
than one of the purchased dwellings,

(ii) 45that interest has a market value of £40,000 or more,
and

(iii) that interest is not reversionary on a lease which has
an unexpired term of more than 21 years.

(2) Sub-paragraphs (6) and (7) of paragraph 3 apply for the purposes of
sub-paragraph (1)(d) of this paragraph as they apply for the
purposes of sub-paragraph (5) of that paragraph.

7 A chargeable transaction falls within this paragraph if—

(a) 5the purchaser is not an individual,

(b) the main subject-matter of the transaction consists of a major
interest in two or more dwellings (“the purchased
dwellings”), and

(c) Conditions A and B in paragraph 5 are met in respect of at
10least one of the purchased dwellings.

Part 3 Supplementary provisions

Further provision in connection with paragraph 3(6) and (7)

8 (1) This paragraph applies where by reason of paragraph 3(7) a
15chargeable transaction (“the transaction concerned”) ceases to be a
higher rates transaction for the purposes of paragraph 1.

(2) The land transaction (“the subsequent transaction”) by reference to
which the condition in paragraph 3(7)(b) was met may not be taken
into account for the purposes of paragraph 3(6)(b) in determining
20whether any other chargeable transaction is a higher rates
transaction.

(3) A land transaction return in respect of the transaction concerned may
be amended, to take account of its ceasing to be a higher rates
transaction, at any time within whichever of the following periods
25expires later—

(a) the period of 3 months beginning within the effective date of
the subsequent transaction, and

(b) the period of 12 months beginning with the filing date for the
return.

(4) 30Where a land transaction return in respect of the transaction
concerned is amended to take account of its ceasing to be a higher
rates transaction (and not for any other reason), paragraph 6(2A) of
Schedule 10 (notice of amendment of return to be accompanied by
the contract for the transaction etc) does not apply in relation to the
35amendment.

Spouses and civil partners purchasing alone

9 (1) Sub-paragraph (2) applies in relation to a chargeable transaction if—

(a) the purchaser (or one of them) is married or in a civil
partnership on the effective date,

(b) 40the purchaser and the purchaser’s spouse or civil partner are
living together on that date, and

(c) the purchaser’s spouse or civil partner is not a purchaser in
relation to the transaction.

(2) The transaction is to be treated as being a higher rates transaction for
the purposes of paragraph 1 if it would have been a higher rates
transaction had the purchaser’s spouse or civil partner been a
purchaser.

(3) 5Persons who are married to, or are civil partners of, each other are
treated as living together for the purposes of this paragraph if they
are so treated for the purposes of the Income Tax Acts (see section
1011 of the Income Tax Act 2007).

Settlements and bare trusts

10 (1) 10Sub-paragraph (3) applies in relation to a land transaction if—

(a) the main subject-matter of the transaction consists of a major
interest in one or more dwellings,

(b) the purchaser (or one of them) is acting as trustee of a
settlement, and

(c) 15under the terms of the settlement a beneficiary will be
entitled to—

(i) occupy the dwelling or dwellings for life, or

(ii) income earned in respect of the dwelling or
dwellings.

(2) 20Sub-paragraph (3) also applies in relation to a land transaction if—

(a) the main subject-matter of the transaction consists of a term
of years absolute in a dwelling, and

(b) the purchaser (or one of them) is acting as a trustee of a bare
trust.

(3) 25Where this sub-paragraph applies in relation to a land transaction
the beneficiary of the settlement or bare trust (rather than the trustee)
is to be treated for the purposes of this Schedule as the purchaser (or
as one of them).

(4) Paragraphs 3(3) and 4 of Schedule 16 (trustees to be treated as the
30purchaser) have effect subject to sub-paragraph (3).

11 (1) Sub-paragraph (3) applies where—

(a) a person is a beneficiary under a settlement,

(b) a major interest in a dwelling forms part of the trust property,
and

(c) 35under the terms of the settlement, the beneficiary is entitled
to—

(i) occupy the dwelling for life, or

(ii) income earned in respect of the dwelling.

(2) Sub-paragraph (3) also applies where—

(a) 40a person is a beneficiary under a bare trust, and

(b) a term of years absolute in a dwelling forms part of the trust
property.

(3) Where this sub-paragraph applies—

(a) the beneficiary is to be treated for the purposes of this
45Schedule as holding the interest in the dwelling, and