Finance Bill (HC Bill 1)

(a) in paragraph (b), after “qualifying trade” insert “or qualifying property
rental business”;

(b) in paragraph (d) for “trade” substitute “qualifying trade or qualifying
property rental business”.

(4) 5After subsection (4) insert—

“(5) For the meaning of “qualifying property rental business” see section
133(3).”

(5) The heading of that section becomes “Occupation by employees or partners of
a qualifying trade or property rental business”.

(6) 10In section 146 (meaning of “qualifying employee” and “qualifying partner” in
section 145)—

(a) in subsection (1), after “trade” insert “or property rental business”;

(b) in subsection (2)—

(i) in the words before paragraph (a), after “qualifying trade”
15insert “or qualifying property rental business”, and

(ii) in paragraph (a)(i), after “trade” insert “or (as the case may be)
property rental business”.

(7) After section 147 insert—

“147A Caretaker flat owned by management company

(1) 20A day in a chargeable period is relievable in relation to a single-
dwelling interest if the dwelling in question is a flat in relation to which
the conditions in subsection (2) are met.

(2) The conditions are that on that day—

(a) a company (“the management company”) holds the single-
25dwelling interest for the purpose of making the flat available as
caretaker accommodation,

(b) the flat is contained in premises which also contain two or more
other flats,

(c) the tenants of at least two of the other flats in the premises are
30members of the management company,

(d) the management company owns the freehold of the premises,
and

(e) the management company is not carrying on a trade or property
rental business.

(3) 35For the purposes of subsection (2), the management company makes a
flat available “as caretaker accommodation” if it makes it available to an
individual for use as living accommodation in connection with the
individual’s employment as caretaker of the premises.

(4) In this section “premises” means premises constituting the whole or
40part of a building.”

(8) In section 116 (dwelling in grounds of another dwelling), in the list in
subsection (6)—

(a) in the entry relating to section 145, for “certain employees or partners”
substitute “employees or partners of a qualifying trade or property
45rental business”;

(b) at the appropriate place insert—

• ““section 147A (caretaker flat owned by management
  company);”.

(9) In section 117 (dwellings in the same building), in the list in subsection (5)—

(a) 5in the entry relating to section 145, for “certain employees or partners”
substitute “employees or partners of a qualifying trade or property
rental business”;

(b) at the appropriate place insert—

• ““section 147A (caretaker flat owned by management
  10company);”.

(10) In section 132 (effect of reliefs under sections 133 to 150), in the list in subsection
(3)—

(a) in the entry relating to section 145, for “certain employees or partners”
substitute “employees or partners of a qualifying trade or property
15rental business”;

(b) at the appropriate place insert—

• ““section 147A (caretaker flat owned by management
  company);”.

(11) In section 159A (relief declaration returns), in the table in subsection (9), in the
20entry relating to section 145, for “(dwellings used for trade purposes:
occupation by certain employees or partners)” substitute “or 147A (occupation
by certain employees etc)”.

(12) The amendments made by this section have effect for chargeable periods
beginning on or after 1 April 2016.

125 25ATED: alternative property finance - land in Scotland

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

(2) Section 157 (land sold to financial institution and leased to person) is amended
in accordance with subsections (3) to (6).

(3) In subsection (1)—

(a) 30in paragraph (a), omit “or section 72 of that Act (land in Scotland sold
to financial institution and leased to person)”;

(b) in paragraph (b), after “transaction” insert “is in England, Wales or
Northern Ireland and”.

(4) In subsection (7)—

(a) 35in the definition of “the first transaction” omit “or (as the case requires)
72”;

(b) in the definition of “the second transaction” omit “or (as the case
requires) 72”.

(5) Omit subsection (10).

(6) 40The heading of that section becomes “Land in England, Wales or Northern
Ireland sold to financial institution and leased to person”.

(7) After section 157 insert—

“157A Land in Scotland sold to financial institution and leased to person

(1) This section applies where Conditions A and B are met.

(2) Condition A is that arrangements are entered into between a person
5(“the lessee”) and a financial institution under which the institution—

(a) purchases a major interest in land (“the first transaction”),

(b) grants to the lessee out of that interest a lease (if the interest
acquired is the interest of the owner) or a sub-lease (if the
interest acquired is the tenant’s right over or interest in a
10property subject to a lease) (“the second transaction”), and

(c) enters into an agreement under which the lessee has a right to
require the institution to transfer the major interest purchased
by the institution under the first transaction.

(3) Condition B is that the land in which the institution purchases a major
15interest under the first transaction is in Scotland and consists of or
includes one or more dwellings or parts of a dwelling.

(4) If the lessee is a company, this Part has effect in relation to times when
the arrangements are in operation (see subsection (5)) as if—

(a) the interest held by the financial institution as mentioned in
20subsection (5)(b) were held by the lessee (and not by the
financial institution), and

(b) the lease or sub-lease granted under the second transaction had
not been granted.

(5) The reference in subsection (4) to times when the arrangements are in
25operation is to times when—

(a) the lessee holds the interest granted to it under the second
transaction, and

(b) the interest purchased under the first transaction is held by a
financial institution.

(6) 30A company treated under subsection (4)(a) as holding an interest at a
particular time is treated as holding it as a member of a partnership if
at the time in question the company holds the interest granted to it
under the second transaction as a member of the partnership (and this
Part has effect accordingly in relation to the other members of the
35partnership).

(7) In relation to times when the arrangements operate for the benefit of a
collective investment scheme (see subsection (8)), this Part has effect as
if—

(a) the interest held by the financial institution as mentioned in
40subsection (8)(b) were held by the lessee for the purposes of a
collective investment scheme (and were not held by the
financial institution), and

(b) the lease or sub-lease granted under the second transaction had
not been granted.

(8) 45The reference in subsection (7) to times when the arrangements operate
for the benefit of a collective investment scheme is to times when—

(a) the lessee holds the interest granted to it under the second
transaction for the purposes of a collective investment scheme,
and

(b) the interest purchased under the first transaction is held by a
5financial institution.

(9) In this section “financial institution” has the same meaning as in section
71A of FA 2003 (see section 73BA of that Act).

(10) References in this section to a “major interest” in land are to—

(a) ownership of land, or

(b) 10the tenant’s right over or interest in land subject to a lease.

(11) Where the lessee is an individual, references in subsections (7) and (8)
to the lessee are to be read, in relation to times after the death of the
lessee, as references to the lessee’s personal representatives.”

(8) The amendments made by this section have effect for chargeable periods
15beginning on or after 1 April 2016.

Part 9 Other taxes and duties

Stamp duty and stamp duty reserve tax

126 Stamp duty: transfers to depositaries or providers of clearance services

(1) 20Part 3 of FA 1986 (stamp duty) is amended as follows.

(2) In section 67 (depositary receipts)—

(a) in subsection (2), for the words from “1.5% of” to the end substitute
“1.5% of—

“(a) the amount or value of the consideration for the sale to
25which the instrument gives effect, or

(b) where subsection (2A) applies—

(i) the amount or value of the consideration for the
sale to which the instrument gives effect, or

(ii) if higher, the value of the securities at the date
30the instrument is executed.”,”

(b) after subsection (2) insert—

“(2A) This subsection applies where the instrument transferring the
securities is executed pursuant to—

(a) the exercise of an option to buy or to sell the securities,
35and

(b) either—

(i) a term of the option which provides for the
securities to be transferred to the person falling
within subsection (6), (7) or (8), or

(ii) 40a direction, given by or on behalf of the person
entitled or bound to acquire the securities
pursuant to the exercise of the option, for the
securities to be so transferred.”, and”

(c) in subsection (3), for “In any other case” substitute “If stamp duty is not
chargeable on the instrument under Part 1 of Schedule 13 to the Finance
Act 1999 (transfer on sale)”.

(3) In section 69 (depositary receipts: supplementary), in subsection (4), for
5“section 67(3)” substitute “section 67(2)(b)(ii) and (3)”.

(4) In section 70 (clearance services)—

(a) in subsection (2), for the words from “1.5% of” to the end substitute
“1.5% of—

“(a) the amount or value of the consideration for the sale to
10which the instrument gives effect, or

(b) where subsection (2A) applies—

(i) the amount or value of the consideration for the
sale to which the instrument gives effect, or

(ii) if higher, the value of the securities at the date
15the instrument is executed.”,”

(b) after subsection (2) insert—

“(2A) This subsection applies where the instrument transferring the
securities is executed pursuant to—

(a) the exercise of an option to buy or to sell the securities,
20and

(b) either—

(i) a term of the option which provides for the
securities to be transferred to the person falling
within subsection (6), (7) or (8), or

(ii) 25a direction, given by or on behalf of the person
entitled or bound to acquire the securities
pursuant to the exercise of the option, for the
securities to be so transferred.”, and”

(c) in subsection (3), for “In any other case” substitute “If stamp duty is not
30chargeable on the instrument under Part 1 of Schedule 13 to the Finance
Act 1999 (transfer on sale)”.

(5) In section 72 (clearance services: supplementary), in subsection (2), for “section
70(3)” substitute “section 70(2)(b)(ii) and (3)”.

(6) The amendments made by this section have effect in relation to an instrument
35which transfers securities pursuant to the exercise of an option where—

(a) the option was granted on or after 25 November 2015, and

(b) the option was exercised on or after 23 March 2016.

127 SDRT: transfers to depositaries or providers of clearance services

(1) Part 4 of FA 1986 (stamp duty reserve tax) is amended as follows.

(2) 40In section 93 (depositary receipts)—

(a) in subsection (4)(b), for the words from “worth,” to the end substitute
“worth—

“(i) the amount or value of the consideration, or

(ii) where subsection (4A) applies, the amount or
45value of the consideration or, if higher, the value
of the securities;”, and”

(b) after subsection (4) insert—

“(4A) This subsection applies where the transfer of the securities is
pursuant to—

(a) the exercise of an option to buy or to sell the securities,
5and

(b) either—

(i) a term of the option which provides for the
securities to be transferred to the person falling
within subsection (2) or (3), or

(ii) 10a direction, given by or on behalf of the person
entitled or bound to acquire the securities
pursuant to the exercise of the option, for the
securities to be so transferred.”

(3) In section 94 (depositary receipts: supplementary), in subsection (4), for
15“section 93(4)(c)” substitute “section 93(4)(b)(ii) and (c)”.

(4) In section 96 (clearance services)—

(a) in subsection (2)(b), for the words from “worth,” to the end substitute
“worth—

“(i) the amount or value of the consideration, or

(ii) 20where subsection (2A) applies, the amount or
value of the consideration or, if higher, the value
of the securities;”,”

(b) after subsection (2) insert—

“(2A) This subsection applies where the transfer of the securities is
25pursuant to—

(a) the exercise of an option to buy or to sell the securities,
and

(b) either—

(i) a term of the option which provides for the
30securities to be transferred to A or (as the case
may be) to the person whose business is or
includes holding chargeable securities as
nominee for A, or

(ii) a direction, given by or on behalf of the person
35entitled or bound to acquire the securities
pursuant to the exercise of the option, for the
securities to be so transferred.”, and”

(c) in subsection (10), for “subsection (2)(c)” substitute “subsection
(2)(b)(ii) and (c)”.

(5) 40The amendments made by this section have effect in relation to a transfer
pursuant to the exercise of an option where—

(a) the option was granted on or after 25 November 2015, and

(b) the option was exercised on or after 23 March 2016.

Petroleum revenue tax

128 Petroleum revenue tax: rate

(1) In section 1(2) of OTA 1975 (rate of petroleum revenue tax) for “35” substitute
“0”.

(2) 5In paragraph 17 of Schedule 2 to that Act (cap on interest on repayments of tax),
in sub-paragraph (5)(b) omit the words from “if that” to the end.

(3) In paragraph 2 of Schedule 19 to FA 1982 (duty to pay instalments based on
amount of tax payable in previous chargeable period), after sub-paragraph (4)
insert—

“(4A) 10In sub-paragraph (1) the reference to any chargeable period for an oil
field ending on or after 30th June 1983 does not include a chargeable
period ending on 31st December 2015.”

(4) The amendment made by subsection (1) has effect with respect to chargeable
periods ending after 31 December 2015.

15Insurance premium tax

129 Insurance premium tax: standard rate

(1) In section 51(2)(b) of FA 1994 (standard rate of insurance premium tax), for “9.5
per cent” substitute “10 per cent”.

(2) The amendment made by subsection (1) has effect in relation to a premium
20falling to be regarded for the purposes of Part 3 of FA 1994 as received under a
taxable insurance contract by an insurer on or after 1 October 2016.

(3) The amendment made by subsection (1) does not have effect in relation to a
premium which—

(a) is in respect of a contract made before 1 October 2016, and

(b) 25falls to be regarded for the purposes of Part 3 of FA 1994 as received
under the contract by the insurer before 1 February 2017 by virtue of
regulations under section 68 of that Act (special accounting schemes).

(4) Subsection (3) does not apply in relation to a premium which—

(a) is an additional premium under a contract,

(b) 30falls to be regarded for the purposes of Part 3 of FA 1994 as received
under the contract by the insurer on or after 1 October 2016 by virtue of
regulations under section 68 of that Act, and

(c) is in respect of a risk which was not covered by the contract before that
date.

(5) 35In the application of sections 67A to 67C of FA 1994 (announced increase in
rate) in relation to the increase made by this section—

(a) the announcement for the purposes of sections 67A(1) and 67B(1) is to
be taken to have been made on 16 March 2016,

(b) the date of the change is 1 October 2016, and

(c) 40the concessionary date is 1 February 2017.

Landfill tax

130 Landfill tax: rates from 1 April 2017

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

(2) In subsection (1)(a) (standard rate), for “£84.40” substitute “£86.10”.

(3) 5In subsection (2) (reduced rate for certain disposals)—

(a) for “£84.40” substitute “£86.10”, and

(b) for “£2.65” substitute “£2.70”.

(4) The amendments made by this section have effect in relation to disposals made
(or treated as made) on or after 1 April 2017.

131 10Landfill tax: rates from 1 April 2018

(1) Section 42 of FA 1996 (amount of landfill tax) (as amended by section 130) is
amended as follows.

(2) In subsection (1)(a) (standard rate), for “£86.10” substitute “£88.95”.

(3) In subsection (2) (reduced rate for certain disposals)—

(a) 15for “£86.10” substitute “£88.95”, and

(b) for “£2.70” substitute “£2.80”.

(4) The amendments made by this section have effect in relation to disposals made
(or treated as made) on or after 1 April 2018.

Climate change levy

132 20CCL: abolition of exemption for electricity from renewable sources

(1) In Schedule 6 to FA 2000 (climate change levy), in paragraph 19(1) (exemption
for electricity from renewable sources)—

(a) in paragraph (c), omit the final “and”;

(b) after paragraph (d) insert “, and

(e) 25the electricity is actually supplied before 1 April
2018.”

(2) In that Schedule omit the following—

(a) in paragraph 5(3), “20(6)(a),”;

(b) paragraphs 19 and 20;

(c) 30paragraph 24(2).

(3) The repeals made by subsection (2) come into force on the day appointed by
the Treasury by regulations made by statutory instrument.

133 CCL: main rates from 1 April 2017

(1) In paragraph 42(1) of Schedule 6 to FA 2000 (climate change levy: amount
35payable by way of levy) for the table substitute—

(2) The amendment made by this section has effect in relation to supplies treated
as taking place on or after 1 April 2017.

134 CCL: main rates from 1 April 2018

(1) 15In paragraph 42(1) of Schedule 6 to FA 2000 (climate change levy: amount
payable by way of levy) for the table substitute—

(2) The amendment made by this section has effect in relation to supplies treated
30as taking place on or after 1 April 2018.

135 CCL: main rates from 1 April 2019

(1) In paragraph 42(1) of Schedule 6 to FA 2000 (climate change levy: amount
payable by way of levy) for the table substitute—

(2) The amendment made by this section has effect in relation to supplies treated
as taking place on or after 1 April 2019.

136 CCL: reduced rates from 1 April 2019

(1) 15In paragraph 42(1) of Schedule 6 to FA 2000 (climate change levy: amount
payable by way of levy)—

(a) in paragraph (ba) (reduced-rate supplies of electricity), for “10”
substitute “7”;

(b) in paragraph (c) (other reduced-rate supplies), for “35” substitute “22”.

(2) 20The amendments made by this section have effect in relation to supplies
treated as taking place on or after 1 April 2019.

Air passenger duty

137 APD: rates from 1 April 2016

(1) In section 30 of FA 1994 (air passenger duty: rates of duty) in subsection (4A)
25(long haul rates of duty)—

(a) in paragraph (a), for “£71” substitute “£73”, and

(b) in paragraph (b), for “£142” substitute “£146”.

(2) The amendments made by this section have effect in relation to the carriage of
passengers beginning on or after 1 April 2016.

30Vehicle excise duty

138 VED: rates for light passenger vehicles, light goods vehicles, motorcycles etc

(1) Schedule 1 to VERA 1994 (annual rates of duty) is amended as follows.

(2) In paragraph 1(2) (vehicle not covered elsewhere in Schedule with engine
cylinder capacity exceeding 1,549cc), for “£230” substitute “£235”.

(3) 35In paragraph 1B (graduated rates of duty for light passenger vehicles)—

(a) for the tables substitute—